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2013 (9) TMI 161 - AT - Income TaxTaxability of capital gain - Long Term Capital Gain u/s 45 - transfer u/s 2(47) - vacant land - Possession given by the society to the developer under joint development agreement - taxability in the year in which sales consideration Received or Actual Sales (accrual basis) – Taxability in the hands of individual members or society - Held that:- As per Section 45 of IT Act, income-tax was to be charged under the head "capital gain" on transfer of a capital asset and shall be deemed to be the income of the previous year in which transfer took place - The year of transfer was the crucial year and not the time of the receipt - 'Accrue' means 'to arise or spring as a natural growth or result', to come by way of increase' - 'Arising' means 'coming into existence or notice or presenting itself' – both the words were used in contradistinction to the word 'receive' and indicate a right to receive - They represent a stage anterior to the point of time when the income becomes receivable and connote a character of the income, which was more or less inchoate and which was something less than a receipt - An unenforceable claim to receive an undetermined or undefined sum does not give rise to accrual - it was not only the money which has been received by the assessee which was required to be taxed but the consideration which had accrued to the assessee was also required to be taxed. Receipt of consideration and registration of property relevant or not - Difficulty in availing Exemption u/s 54 or 54EC - Agreement subject to approvals and permissions – Condition for transfer of land – conditions and encumbrances Past consideration recievable towards the proposed transfer - Computation of Capital Gain –Part performance of contract u/s 53A of TPA – registration of the terms of agreement - Held that:- It was not necessary to get the instrument of transfer registered for the purpose of Income-tax Act when a person had got a valid legally conveyed after complying with the requirements of the law - Technically it can be said that the developer had purchased the membership of the Members in the society which would lead to enjoyment of the property and in that technical sense, clause (vi) of Section 2(47) is applicable. Reference has been made only to Section 54 and Section 54EC - Section 54 deals with deduction in case the assessee being an individual or HUF, transfers the residential house - the assessee had transferred the plot – thus it cannot be said that deduction u/s 54F and 54 was same - no ground had been raised for deduction u/s 54F - Following decision of Charanjit Singh Atwal Versus Income-tax Officer, Ward -VI (1), Ludhiana [2013 (8) TMI 364 - ITAT CHANDIGARH], Commissioner of Income-Tax Versus Podar Cement Pvt. Limited And Others [1997 (5) TMI 2 - SUPREME Court] and Mysore Minerals Ltd. v. CIT [1999 (9) TMI 1 - SUPREME Court] - Decided against assessee.
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