TMI Blog2014 (1) TMI 1186X X X X Extracts X X X X X X X X Extracts X X X X ..... the absence of any material produced by the assessee to show that when the possession is delivered, which shows foundation had been laid for all the even phases and constructions were almost complete in 4 phases, and it had to be finished. Coupled with the fact that in 1996, Power of Attorney was executed to sell the flats, an obvious inference that can be drawn from the material on record is that possession has been delivered under the agreement; payment of Rs.10 lakhs was paid, that is the reason why roughly about Rs.35 lakhs has been paid between 30.6.1994 and 31.5.1996 - It is a joint development agreement - Without possession of the property, no construction can be taken - the finding recorded by the authorities that possession was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... akhs and 8% of the built area. Rs.10 lakhs was paid as advance. On 27.2.1996, a modified agreement came to be executed retaining the very same terms except the expenditure of enhancing the consideration from Rs.30 lakhs to Rs.40 lakhs and share in built up area was also increased from 8% to 8.5%. On the date of said agreement, a sum of Rs.10 lakhs was paid. Subsequently, on 30.4.1996, a sum of Rs.7,50,000/- was paid and on 31.5.1996, yet another sum of Rs.7,50,000/- was paid. Thus, the assessee received Rs.35 lakhs out of Rs.40 lakhs payable. The assessee also executed a Power of Attorney on 18.12.1996 in favour of the representative of the builder agreeing to authorize him to execute the sale of the built area and delivery of possession to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luding the aforesaid property. The assessee in the return of income for assessment year 2003-04, has taken the stand that the said land was transferred in the financial year 2002-03, when she entered into an agreement with M/s.Shanti Nikethan Housing Foundation on 8.1.2003. However, the said agreement clearly discloses the following: WHEREAS, the Consenting party failed to meet its commitments made in the MOU date 1st Nov.01 to the First Party regarding delivery of built space in twelve months, having delivered only one apartment of 1720 sft. And neither did it obtain release of the title deeds from M/s. SBI Home Finance Ltd. WHEREAS, THE First Party to protect its interest, decided to revoke the Power of Attorney executed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ur blocks. Because of the cancellation of the earlier agreement by mutual consent, the said project was handed over to the new builder. It is in these circumstances, the three authorities on careful examination of the entire material produced before them have concurrently held that the possession of the property was delivered by the assessee on execution of the agreement dated 30.6.1994 and therefore, in terms of the definition of the word transfer in Section 2(47) of the Income Tax Act, 1961, the transfer had taken place. Consequently, the assessee was liable to pay capital gain tax on such transfer. 4. Challenging the aforesaid finding, the learned Counsel for the assessee contended that, neither the agreement dated 30.6.1994 nor 27.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment does not specify the delivery of possession and in the absence of any material produced by the assessee to show that when the possession is delivered, in the facts of this case, having regard to the admitted facts and the recitals in the agreement dated 8.1.2003, which shows foundation had been laid for all the seven phases and constructions were almost complete in 4 phases, and it had to be finished. Coupled with the fact that in 1996, Power of Attorney was executed to sell the flats, an irresistible inference that can be drawn from the material on record is that possession has been delivered under the agreement; payment of Rs.10 lakhs was paid, that is the reason why roughly about Rs.35 lakhs has been paid between 30.6.1994 and 31.5. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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