Nitin Prakash vs. DCIT TS-734-ITAT-2022 (Mum.) A.Y.: 2011-12
Date of order: 22nd August, 2022 Section: 48
36. Indexation has to be granted with effect from the previous year in which the allotment was made even though the payment has been made in instalments in later years.
FACTS
The assessee had purchased four residential flats in a building i.e. Ashok Towers, Tower-B, Parel, Mumbai in September, 2004. The assessee paid Rs. 9,58,000 at the time of booking of the flats in June, 2004 and 10 per cent of the total consideration i.e. Rs. 19,17,700 in October, 2004. The balance amount was paid as per the schedule provided by the builder. The registered agreement for sale of flats was executed on 31st December, 2008. During the period relevant to the assessment year under appeal, the assessee vide registered agreement dated 13th August, 2010 sold the flats. For the purpose of computation of ‘long term capital gain’ the assessee claimed indexation on purchase price of Rs. 2,03,36,000 from the F.Y. 2004-05 i.e. the year in which the assessee had booked the flat. The assessee computed indexed cost of acquisition at Rs. 3,01,22,700. The AO rejected the assessee’s computation of indexed cost and applied indexation as and when the installments were paid by the assessee i.e. on the basis of year of payment of installments.
Aggrieved, the assessee preferred an appeal before CIT(A) who confirmed the acti
