IN THE INCOME TAX APPELLATE TRIBUNAL 'C' BENCH, CHENNAI

Parties Involved

Facts Summary

The assessee was a shareholder in Carbon Industries Pvt. Ltd., which went into liquidation. The company owned land at Tiruvottiyur, which was transferred to the shareholders during financial year 2012-13. The assessee received this property by way of release deed dated 10.12.2012 and sold it to third parties between 25.04.2013 and 06.08.2013. The assessee claimed this land as a long-term capital asset, but the Assessing Officer treated it as a short-term capital asset. The Commissioner of Income Tax (Appeals) held that the period of computation of holding the asset is to be considered from the date of acquisition of shares of the company. The assessee also received land at Seevaram through a release deed dated 10.05.2013, which was received as an outcome of the liquidation of the assessee's company. The Assessing Officer applied the provisions of section 50C of the Act, but the Commissioner of Income Tax (Appeals) held that the provisions of section 50C are not applicable in the case of the Seevaram land received on the distribution of assets on liquidation of the company.…

Legal Issues

• 1. Whether the sale of land at Tiruvottiyur High Road should be treated as Long Term Capital Gain or Short Term Capital Gain.
• 2. Whether the provisions of Section 50C of the Act apply to the sale of land situated at Seevaram.

Judgment Outcome

Decided in favour of Revenue.

Precedents Relied Upon

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