KHIVRAJ MOTORS P LTD Vs. DEPUTY COMMISSIONER OF INCOME TAX
INCOME TAX APPELLATE TRIBUNAL
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S. Kannan, Accountant Member -
(1.) THE assessee is the appellant and the appeals are directed against the orders of the CIT (Appeals) dated 4-10-1991, 21-10-1991 and 6-8-1992. As common issues are involved in all these appeals, they were heard together and disposed of by this common order for the sake of convenience.
(2.) Common issue No. 1 : Valuation of the property situated at No. 35, Mount Road, Nandanam, Madras. The facts of the case are that in May 1974 the assessee purchased a site admeasuring about 41 grounds, together with some structures standing therein, for a stated consideration of Rs. 11,72,097. Initially, it is common ground, the assessee treated the said site as investment. Accordingly it disclosed the said site in its balance-sheet under the head "Investments at cost".
Subsequently, in early 1980, the assessee decided to enter into real estate business for which purpose it made suitable amendments to its Memorandum of Association, which were approved by the Company Law Board, Southern Region, Madras, on 4-7-1980.
(3.) THEREAFTER, it demolished the old structure, parcelled out a piece of land admeasuring about four grounds and constructed a building thereon. The assessee sold this building together with the four ground plot to one M/s. C. Abdul Rehman and Others, Periamet, Madras for a stated consideration of Rs. 22 lakhs.;
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