Monday, 4 June 2012

S.45 : Capital gains-No cost of acquisition-Ancestor land-Compensation received from

The assessee received Inami land from his ancestors for service of ‘Dargah’. Subsequently the municipal
corporation acquired the said land and paid compensation to assessee. Assessing Officer was of the view
that income arising from aforesaid transaction was liable to tax under section 45. In the present case
since land was acquired by assessee’s ancestors free of cost for maintenance and services of Dargah, any
element of cost in acquisition of aforesaid land was in conceivable. The ITAT therefore held that the
transaction in question was outside the purview of section 45.(A.Y.2005-2006)
ITO v. Pashu Mohammed Zainuddin (2012) 50 SOT 45(URO)(Pune)(Trib.)

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