In a recent decision, the Bombay High Court observed that Section 52C of the Income Tax Act is not applicable in case of Capital Gains arising out of the transfer of leasehold property under the relevant provisions of the Income Tax Act.
In the instant case, the revenue challenged the order of the Income Tax Appellate Tribunal who has deleted the addition of Long Term Capital Gain of Rs.80,58,000/on the ground that provisions of section 50C of the Income Tax Act, 1961 were not applicable to transfer of land and building, being a leasehold property.
While dismissing the appeal the division bench comprising of Justice M.S Sanklecha and Justice S.C Gupte observed that “Our Court in DIT vs. Credit Agricole Indosuez 377 ITR 102 (dealing with Tribunal order) and the Apex Court in UOI vs. Satish P. Shah 249 ITR 221 (dealing with High Court order) has laid down the salutary principle that where the Revenue has accepted the decision of the Court/Tribunal on an issue of law and not challenged it in appeal, then a subsequent decision following the earlier decision cannot be challenged. Further, it is not the Revenue’s case before us that there are any distinguishing features either in facts or in law in the present appeal from that arising in the case of Atul Puranik(supra).”
Read the full text of the Judgment below.
