TMI Blog2011 (9) TMI 105X X X X Extracts X X X X X X X X Extracts X X X X ..... year. - Decided against the assessee. - IT APPEAL NO. 6546 (MUM.) OF 2008 - - - Dated:- 9-9-2011 - R.S. SYAL, VIJAY PAL RAO, JJ. Harish Mothiwalla for the Appellant. P.C. Mourya for the Respondent. ORDER R.S. Syal, Accountant Member. This appeal by the assessee is directed against the order passed by the Commissioner of Income-tax (Appeals) on 11.09.2008 in relation to the assessment year 2001-02. 2. The learned Counsel for the assessee filed application for admission of the following additional ground reading as under :- "On the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) XXIV, Mumbai, erred in confirming the order of the Assessing Officer in respect of charging receipt of Rs. 20,00,000 and notional market value of flat amounting to Rs. 19,06,800 to be received from developers under the head "Capital Gains", particularly when, the developer has not fulfilled the conditions stated in Agreement for development dated November 11, 1999 and thus not complied with requirements of Section 53A of Transfer of Property Act and therefore the transaction is not covered by section 2(47)(v) of the Income Tax Act, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 700000 TAXABLE CAPITAL GAIN NIL 6. The assessee was called upon to explain as to why exemption u/s 54F should not be restricted to investment in one residential house as against two claimed by the assessee. The assessee stated that she had not received possession of flat from Karasha Construction Private Limited and Graceland Construction Private Limited. Considering these facts, the Assessing Officer held that the exemption u/s 54F was to be granted only in respect of flat from Prithvi Builders. As against the NIL capital gain declared by the assessee, the A.O. determined long-term capital gain at Rs. 13,09,490. The assessee was not successful before the learned CIT(A) as well. 7. We have heard the rival submissions and perused the relevant material on record. The learned counsel for the assessee vehemently contended that the assessee held 10% share in certain land which was agreed to be transferred to Karasha Construction Private Limited and Graceland Construction Private Limited. It was submitted that the assessee received only a sum of Rs.20 lakh from this builder who had also undertaken to allot one self-contained flat on any floo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owner is a person who is entitled to receive income from the property in his own right and the requirement of registration of sale deed in the context of section 22 is not warranted. Again the Hon'ble Supreme Court in Mysore Minerals Ltd. v. CIT [1999] 239 ITR 775/106 Taxman 166 has held that anyone in possession of property in his own right exercising such dominion over the property as would enable others being excluded therefrom and having the right to use and occupy the property in his own right, would be the owner of the building for the purpose of section 32(1) though a formal deed of title may not have been executed and registered. These two judgments clearly demonstrate that even if legal title has not passed to the transferee, the transaction shall still be regarded as the transfer where the property is handed over in part performance of the agreement. It is the prescription of section 53A of the Transfer of Property Act, which has been included in section 2(47) defining the concept of 'transfer'. 10. Coming to the facts of the instant case it is clear that since the assessee entered into agreement with the developers for transfer of the property, handed over the possessi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecision relied upon by the learned A.R. in the case of General Glass Co. (P.) Ltd. (supra) is clearly distinguishable as in that the case the transferee was not willing to perform his obligations under the contract. On the contrary we are confronted with a situation in which the transferee has taken over the possession, constructed the building and paid a sum of Rs. 20 lakh to the assessee in cash and has also undertaken to allot a flat in the said building. As such this contention raised on behalf of the assessee through the additional ground that the transfer is not covered u/s 2(47)(v) is sans merit and deserves to be rejected. We hold accordingly. 12. There is one more interesting aspect of the case. It has been the consistent stand of the assessee that till date the flat has not been allotted by the builder to the assessee. During the course of arguments it came to light that the assessee received a sum of Rs. 21.00 lac from the builder on 24.12.2003, other than Rs. 20.00 lac as agreed upon as per agreement. On a query it was stated that the said sum of Rs. 21.00 lac did not represent consideration in lieu of flat but was in the nature of interest from the builders for not a ..... 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