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2016 (4) TMI 631 - AT - Income TaxDeemed Transfer u/s 2(47)(v) - LTCG - transfer of property through Joint Development Agreement (JDA) - Held that:- It is clear that 'willingness to perform' for the purposes of Section 53A is something more than a statement of intent; it is the unqualified and unconditional willingness on the part of the vendee to perform its obligations. Unless the party has performed or is willing to perform its obligations under the contract, and in the same sequence in which these are to be performed, it cannot be said that the provisions of Section 53A of the Transfer of Property Act will come into play on the facts of that case. It is only elementary that, unless provisions of Section 53A of the Transfer of Property Act are satisfied on the facts of a case, the transaction in question cannot fall within the scope of deemed transfer under Section 2(47)(v) of the IT Act. The developer had failed to get the approval of the plan or perform its obligations under the JDA. Even otherwise, the assessing authorities has not brought on record the actual position of the project even as on the date of assessment and he has not recorded the findings whether the developer started the construction work at any time during the assessment year 2006-07. The condition laid down under Section 53A of the Transfer of Property Act was not satisfied in the assessment year 2006-07. - . When time is essence of the contract, and the time schedule is not adhered to, it cannot be said that such a contract confers any rights on the vendor/landlord to seek redressal under Section 53A of the Transfer of Property Act. This agreement of JDA cannot, therefore, be said to be in the nature of a contract referred to in Section 53A of the Transfer of Property Act. It cannot, therefore, be said that the provisions of Section 2(47)(v) will apply in the situation before us. - no capital gain arises in the hands of the assessee for the asst. year 2006-07 and the appeal of the assessee for the asst. year is to be allowed. - Decided in favor of assessee. Denial of cost of improvement the assessee has not produced anything to prove the cost of construction. It is the duty of the assessee to produce necessary evidence to show that the assessee actually incurred towards improvement of capital asset. However, the assessee asked one more opportunity to see the document collected by the A.O., which was relied upon by him, at the back of the assessee. In view of this, we remit this issue to the file of the AO for fresh consideration and the assessee is directed to produce necessary evidence in support of the claim of the assessee, as the AO used the report collected from the Commercial Department, Maharashtra viz. MahaVat without providing the same to the assessee. Accordingly, in the asst. Year 2009-10, long term capital gains on the sale of that portion of the land corresponding to the flats allotted to the assessee’s share and sale of flats constructed thereon to be assessed as long term capital gains in sale of land and short term capital gains in sale of flats. Decided partly in favor of assessee.
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