MADHU KAUL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE appellant challenges correctness of the order dated March 15, 1999 (annexure P -3), passed by the Income -tax Appellate Tribunal Chandigarh Bench, Chandigarh. The substantial questions of law that arise for adjudication are as follows:

(2.) COUNSEL for the assessee submits that the flat was allotted on June 7, 1986, vide letter, conveyed on June 30, 1986. The first installment was paid on July 4, 1986. The flat was sold on July 5, 1989, i.e., after 36 months. The sale, therefore, results in long -term capital gains. It is further contended that right to hold flat came to vest in the assessee upon allotment and at the latest upon payment of Rs. 7,500 on July 4, 1986. The sale of the said flat on July 5, 1989, reveals that the assessee held the capital asset for a period exceeding 36 months. It is further submitted that identification of the flat or physical delivery of possession is irrelevant as right to hold property stands crystallized upon allotment and payment of the first installment. The allotment of a particular flat and delivery of its possession would relate back to the allotment and payment of the first installment. The appellant having held the flat from July 4, 1986, the date of payment of first installment to July 5, 1989, fulfils the parameters of a long -term capital gain, thereby rendering the impugned orders illegal and void. It is further contended that the question of law framed in the present appeal has been answered in favour of the assessee in (Vinod Kumar Jain v. CIT I.T.A. No. 140 of 2000, decided on September 24, 2010 - -since reported in : [2012] 344 ITR 501 (P & H).

(3.) WE have heard counsel for the parties and perused the impugned order.