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2023 (6) TMI 511 - AT - Income TaxAssessment of capital gain - transfer u/s. 2(47)(vi) r/w s. 2(47)(i) - JV agreement for construction of building/s - effect of part-performance of a contract u/s. 53A of the TP Act - both the GPA and JVA were unregistered documents - assessee’s plea before him that the transaction did not materialise as the Builder-developer could not complete the building even by 2017, was met by him by stating that the project was nearly complete in October, 2018 - HELD THAT:- Non-delivery of consideration cannot be by itself regarded as a project failure, as where the necessary permissions, which are the responsibility of the Developer-Builder, and subject to which only the project could be undertaken, do not materialize, failing the project, as was the case in Balbir Singh Maini [2017 (10) TMI 323 - SUPREME COURT]. In the instant case, the GPA in fact was specifically executed only for the same. Why, even upto December, 2016, i.e., up to completion of assessment, there was admittedly no whisper of the project failing, but only of it being part-performed. And even as without doubt there could be issues leading to the project being delayed. In fact, the ld. CIT(A) clearly states, unrebutted before us, of the project being nearly complete in October, 2018. No material contradicting the same has been brought on record, or otherwise to our notice. We, yet, in the interest of justice, restore the matter back to the file of the first appellate authority for the assessee to exhibit the non-transfer u/s. 2(47)(vi) r/w s. 2(47)(i) in the undisputed facts and circumstances of the case. Reference to s. 2(47)(i) is made so as to highlight that the rights to the buyers of the apartments would stand to arise thereunder, if not u/c.(vi). Further, we say ‘undisputed’ with a view to clarify of no dispute qua facts being either observed or brought to our notice. And, further, to eliminate any scope for the said remittance leading to expanding the scope of controversy, or fresh facts or disputes being raised. No application for admission of additional evidence, it may be noted, stands made either at the first appellate stage, or even before us u/r. 29 of the Income Tax (Appellate Tribunal) Rules, 1963. All the material on record, including before the Tribunal, would though be liable to be considered. Our only purpose is to allow the assessee opportunity to state his case as regards his legal claim as to non-applicability of s. 2(47)(vi); Sh. Veeramani claiming to be not fully prepared. In so deciding, we also take note of the submission by him that the project was finally completed by the co-owners themselves, i.e., by taking-over the project, which may have computational implications. CIT(A) shall cause such verification and adjudication by the assessing authority, by remanding the matter thereto, as it may deem fit and proper in the circumstances, and finally decide the matter/s, issuing definite findings of fact and law, per a speaking order and after hearing both the parties before him. The issue of deduction u/s. 54-F shall also be adjudicated upon in view of the Board Circular 672 dated 16/12/1993, allegedly not considered by him. Both the sides before the ld. CIT(A), as indeed he himself, may rely on case law, observing of course the principles of natural justice.
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