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2021 (5) TMI 663 - AT - Income TaxGain on sale of land - capital gain or business receipts - plot of land purchased followed by the development agreement - transfer of asset u/s 2(47) - HELD THAT:- As Learned counsel first of all stated very fairly that there is no dispute raised at the assessee’s behest regarding correctness of the both the lower authorities’ action treating the impugned development agreement dt.15-08-2004 with M/s.Ashwini Abodes for construction of flats and to receive the developed area to this effect having ratio of 44:56; party-wise; respectively as amounting to transfer u/s.2(47)(v) of the Act. We thus affirm the learner lower authorities’ action to this effect. LTCG or Business income - As assessee’s development agreement that she had herself not undertaken any development activity indicating the adventure component which in fact had been borne by the concerned developer only. We also wish to highlight the fact that the parcel of land has remained the same in AYs.2005-06 to 2008-09 wherein the assessee has herself accepted the learned lower authorities’ action treating the developed area as the capital asset only giving rise to long term capital gains. We rather note that the assessee has claimed Section 54 deduction of ₹ 69,27,420/- AY.2008-09 as well. We thus hold that the assessee’s divergent stand in treating herself as engaged in adventure in real estate development in AY.2005- 06 and capital gains in AY.2008-09 does not deserve to the concurred with. We therefore decline her argument that the plot of land purchased on 15-08-2004 followed by the development agreement within a very short span of time i.e., 19-10-2004 could give rise to huge profits in the nature of business income only. Reopening of assessment - It is an admitted fact that their lordship’s decision herein nowhere dealt with an instance of double addition per se as is the assessee’s case before us.We therefore restore the instant issue back to the Assessing Officer to frame his necessary computation afresh after ensuring that whatever the assessee’s income has been assessed in preceding assessment year(s) would not be treated as her income escaping assessment pertaining to AY.2008-09.
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