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2014 (4) TMI 1100 - AT - Income TaxDeduction u/s 54EC denied - transfer - Held that:- It is also not in dispute that the condition was to pay full and final consideration before carrying out the development activity, and the transferee developer did not pay the complete consideration. In any case, the fact that the possession envisaged in the agreement dated 13.09.2007 was a conditional possession is not disputed. Therefore, in such a situation, it could not be said that the development agreement of such type would be an agreement which is envisaged to trigger the operation of section 53A of the Transfer of Property Act. On this count itself we find that there is no justification for the Revenue to establish the date of transfer on the strength of section 2(47)(v) of the Act. Hence, we are unable to uphold the stand of the Revenue on this count also. On the contrary, since there is no dispute to the assertions of the assessee that actual possession of the property was given in March, 2008 as confirmed by the developer in its co1n4firmation letter dated 19.11.2010, we deem it fit and proper to hold that the date of transfer has to be understood as 01.03.2008 and accordingly, the period available with the assessee to make the investment qualifying for deduction u/s 54EC has to be calculated accordingly. In this view of the matter, the investments in the bonds of REC Ltd. made by the assessee on 22.08.2008 is within the period of six months from the date of transfer as prescribed in section 54EC of the Act and accordingly the assessee is eligible for deduction u/s 54EC of the Act also - Decided in favour of assessee Addition to taxable income - addition on account of the land development agreement entered by the assessee with Rudra Buildcon Pvt. Ltd. apart from the cash consideration, the developer also offered to the assessee a separate tenement which was to be constructed by the developer on its own cost - Held that:- In the present case, assessee was owner of land at 799/A, Bhandarkar Road, Pune and assigned the development rights in such land to a builder M/s Rudra Buildcon Pvt. Ltd. vide agreement dated 13.09.2007. Apart from receiving the consideration price in cash, assessee was also entitled to receive from the developer a tenement constructed over a portion of land and such construction was to be undertaken by the developer at his own cost. While undertaking development and construction the developer was to provide an alternative accommodation to the assessee for his use and the Assessing Officer has pointed out that a sum of ₹ 2,55,000/- was spent by the developer on account of such alternative accommodation. In our considered opinion, the taxability of the aforesaid sum has to be seen as a part and parcel of the transaction resulting in assessee getting possession of the constructed tenement from the developer. Ostensibly, there is no justification for the Revenue to say that it is a revenue receipt because it is nobody’s case that the arrangement with the developer undertaken by the assessee is in the course of any business activity. Therefore,the Assessing Officer shall re-work the total income of the assessee on the impugned aspect in the aforesaid light. - Decided in favour of assessee for statistical purposes. Addition invoking section 14A - Held that:- the proposition advanced by the learned counsel for the assessee cannot be disputed, so however, we do not find that the assessment order in the present case suffers from the vice that is sought to be made out by the assessee. In-fact, the Assessing Officer has noted that assessee has incurred expenses on account of telephone, printing stationery, vehicle running, account writing charges, etc. and he rightly concluded that certain expenses have been incurred for earning of excepted income. Having regard to the facts and circumstances of the present case and the discussion in the order, in our view, the requisite satisfaction mandated in section 14A(2) of the Act stands fulfilled in the present case and the action of the Assessing Officer in invoking section 14A of the Act is hereby affirmed. - Decided against assessee
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