S.

2(29A): Long term capital asset-Capital gain- Period of holding- Letter of allotment- Period
of holding of flat has to be reckoned from date of allotment letter for the purpose of
computing capital gain. [S.45, 54F]
The Tribunal held that the assessee was allotted a flat in a building vide allotment letter
dated 22-01-2005, by which the builders agreed to sell the flat to the assessee. After signing
the said letter of allotment and paying the booking amount, the assessee acquired the right
in the flat. Thus, all the rights in the flat were duly acquired by the assessee on 22-1-2005,
the period of holding is to be computed with respect to the date of allotment that is 22-012005. Thus when the assessee sold the flat on 5-03-2009, the holding period of the right in
flat with the assessee was right in flat with the assesse was more than 36 months, therefore,
the assessee was right in claiming exemption under section 54F of the Act.ITA no
448/Ind/2013 dt.19-12-2013) (AY. 2009-10)
ACIT .v. Sanjay Kumath (2014) The Chambers Journal April P, 81 (Indore)(Trib.)
S.2(42A): Transfer-Letter of allotment-Period of holding-Booking rights-Capital asset of
booking rights accrues to buyer only on signing of agreement and not on dare of allotment
application. [S.2(14), 2(29A), 45]
The court held that for computing the period of holding of capital asset to be counted from
the date of buyers agreement and not from the date of booking or date of allotment
application. On the facts the allotment or confirmation letter states clearly that no right to
provisional or final allotment accrues untill the agreement is signed between the buyer and
the builder. Thus , in such a case capital asset of booking rights accrues to buyer only on
date of signing buyers agreement and not on date of allotment application or confirmation
letter.
Gulshan Malik .v. CIT (2014) 223 Taxman 243 (Delhi)(HC)
observations:- It is worthwhile to note that the Delhi High Court, in the given facts,
recognised the agreement date as the date on which the rights in an immovable property
accrues to the buyer, as against the date of application/confirmation letter. This was
particularly driven by the fact that the application /confirmation letter specifically stated that
no rights would accrue to the allottee until the agreement was signed. The Delhi High Court
observed that the conveyance of a property or the doctrine of part performance are not the
only ways which result in the creation of enforceable rights. In view of Explanation 2 to
section 2(47) of the Act, even the right or an interest in a property could be a transferable
capital assets.