Law:

Section:

Section 80T of the Income-tax Act, 1961 - Deductions - Long-term capital gains - Assessment year 1983-84 - Assessee had become member of a co-operative housing society by acquiring shares therein on 15-11-1979 - Possession of flat was delivered to assessee in October, 1981 which was sold on 4-12-1982 - Whether assessee had held shares and allotment of flat in said society for a period of more than 36 months reckoned from 15-11-1979, and, accordingly, capital gain was rightly held by Tribunal to be a long-term capital gain and assessee was rightly entitled to benefit of section 80T - Held, yes FACTS The assessee had taken possession of the flat in October, 1981 from a co-operative society. It was sold in December, 1982. The assessee had claimed the capital gain as a long-term capital gain and, accordingly, had claimed deduction under section 80T. The assessee contended that she had become a member of co-operative housing society by acquiring shares therein on 15-11-1979; that the total cost of flat after excluding the loan amounting to Rs. 30,000 came to Rs. 67,757 and that the possession of the flat was, however, delivered by the said society to the assessee only in October, 1981 which was sold on 4-12-1982. It was, thus, contended that it was not a case of short-term capital gain, but was that of long-term capital gain. The ITO was of the opinion that since the assessee had taken possession in October, 1981 and the date of possession was material for the purpose of effective ownership, it was a case of short-term capital gain and should be taxed accordingly. On appeal, the AAC, held that the date of acquisition of flat was the date of agreement and not the date of occupation of the flat, and treated capital gain as long-term capital gain. On revenue's appeal, the Tribunal confirmed the view of the AAC. On reference : HELD Clause (iii ) of section 27 makes it clear that the Legislature has not made any reference to handling over possession because the possession is never considered to be a sine qua non of ownership which consists of a bundle of rights. Moreover, the amendment by the Legislature by insertion of clause (iiia) with effect from 1-4-1988 also…

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