Sec. 47 & 56(2) of Income Tax Act, 1961 – Capital gain - The assessee is an individual and is engaged in the business of trading in stock, under the name and style of M/s. Ravi jalan, sole proprietor concern. He filed his return of income declaring total income of Rs.3,82,060/-. The AO completed assessment u/s 143(3) of the Act and assessed the total income at Rs.1,39,68,151/- interalia, denying the benefit claimed by the assessee u/s 47 (xiv) of the Act, in respect of transfer of assets and liabilities of the proprietary concern M/s. Ravi jalan to a Private Limited Company, M/s. J.S. Tradex Pvt. Ltd. Consequent to the denial of the benefit u/s 47(xiv), the AO alternatively computing the income in question under the head "Income from other sources", by invoking the provisions of Section 56(2)(vii)(c) of the Act. A sum of Rs.1,24,54,080/- was brought to tax. Disallowance was made u/s 14A of the Act r.w.r. 8D and also made an addition on account of notional rent. CIT(A) confirmed the additions made by the AO but granted part relief only on the issue of notional rent. ITAT deleted both the addition made under the head "Capital Gain" as well as under the head "income from other sources" on the issue of transfer and also deleted the disallowance of Rs.1,38,690/-. Accordingly, appeal of the assessee allowed. - RAVI JALAN V/s ITO - [2020] 181 ITD 284 (ITAT-KOLKATA)