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2020 (12) TMI 78 - AT - Income TaxAddition of short term capital gain - Non-adjustment of adavance received with the sale consideration of property - lifting of corporate veil - transfer of the appellant's property in terms of the Memorandum of Understanding [MOU] - Whether none of the conditions mentioned u/s. 2[47][v] of the Act were attracted especially since the MOU was an unregistered document and no possession of the said property was delivered by the appellant to M/s. Synergia Consultants Pvt. Ltd., during the year pursuant to the said unregistered MOU ? - HELD THAT:- Assessee has been submitting that there was a loan transaction amounting to ₹ 3,50,00,000/- between assessee and M/s Synergy Consultants Pvt. Ltd. Subsequently, ₹ 3,50,00,000/- was shown as advance towards purchase of land by an agreement dated 15/06/2009 entered into between assessee and M/s Synergy Consultants Pvt. Ltd. Towards proposed sale of 4156 sft. built up area on the 1st floor of No.34, Embassy Diamanate, Vithal Malya Road (hereinafter referred to as said property). Admitedly, asessee, is also the owner of said property and is 50% Director in M/s Synergy Consultants Pvt. Ltd. A transaction of loan or proposed sale does not depend merely on the terms of the document, but has got to be judged from the intention of the parties and all the circumstances of the case. As per the MOU dated 15/06/2009, the sale was to take place by December, 2012, however, admittedly, the same has not materialised till date. During the period ₹ 3,50,00,000/- was received, out of total consideration of ₹ 4,50,00,000/- from M/s Synergy Consultants Pvt. Ltd. It is unbelievable that, the advance received was adjusted towards cost of said property in a proposed sale, which has not been materialised till date. This argument does not hold waters in the eyes of law. In our view, this is an arranged transaction which cannot be ignored. In a matter of such description, the authorities are entitled to pierce the veil of corporate entity and look at the reality of the transaction. We therefore remand this issue to Ld.AO to consider it afresh in accordance with law. - Decided in favour of assessee for statistical purposes.
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