2021 (9) TMI 1244 - AT - Income Tax

Capital gain - year of assessment - CIT-A holding 50% of the sale consideration received in the year under consideration is chargeable to tax - HELD THAT - As the issue raised is similar to the facts therein in the case of Shri Rajendra S. Goel 2017 (1) TMI 1765 - ITAT PUNE and applying the principle laid down by the ITAT Pune Benches deleted the addition made by the AO by holding the capital gain is chargeable to 50% of the consideration which has been received in the year under consideration. CIT(A) discussed the issue in detail and we find no dispute with appellant-Revenue regarding the receipt of 50% of sale consideration by the assessee in the year under consideration. There is no order contrary to the view taken by the ITAT Pune Benches in the case of Shri Rajendra S. Goel brought on record and therefore we find no infirmity in the order of CIT(A) and it is justified. Appeal of Revenue is dismissed.

Summary

Issues:
Challenge to 50% of sale consideration being chargeable to tax.

Analysis:
The appeal was filed by the Revenue against the order of the Commissioner of Income Tax (Appeals)-8, Pune for the assessment year 2009-10. The main issue raised was the Revenue's disagreement with the CIT(A)'s decision to tax 50% of the sale consideration received in the relevant year. The assessee, engaged in real estate business, had sold land to a company for a substantial amount. The AO determined the capital gain in the assessee's hands based on possession handover, stamp duty payment, and registration of the sale agreement. However, the CIT(A) referred to a similar case involving Shri Rajendra S. Goel and held that 50% of the consideration received during the assessment year 2009-10 should be charged under capital gains. The CIT(A) relied on the ITAT Pune Benches' decision in Shri Rajendra S. Goel's case, which supported the treatment of 50% of the sale consideration as taxable. The CIT(A) found no discrepancy in the facts and applied the same principle, ultimately deleting the addition made by the AO. The judgment emphasized the consistency with the ITAT Pune Benches' decision and the absence of conflicting orders on record. Consequently, the appeal of the Revenue was dismissed, upholding the CIT(A)'s order.

This judgment highlights the importance of consistency in tax treatment based on precedents set by higher authorities. It underscores the significance of aligning decisions with established principles to ensure fair and equitable tax assessments. The case serves as a reminder of the legal principles governing tax liabilities and the relevance of past judgments in shaping current tax interpretations.