TMI Blog2017 (5) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... transactions are completed by the builder without any dispute with the assessee. Simply because, the agreement was not transferred, it cannot be said that the transfer has not taken place, unless either of the parties disputed unregistered agreement. If the builder was merely a licence he would not derive any interest in the subject property and would not be referred as vendor in the sale deeds. It is immaterial that Power of Attorney was not executed. Thus, the recitals in the sale deeds, narrating the developer also as, vendor of the property clearly show that the transfer of interest had taken place under the Development Agreement in favour of the developer and such transfer is liable for capital gains in this subject year, being the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had entered into an agreement with M/s. Sai Ganesh Builders vide unregistered document dated 24/08/2005, by which assessee and builder have to share built-up area in 35 : 65 ratio and assessee was entitled to 13 flats (14156 sq.ft. of built-up area) including common area. Thus, the Assessing Officer noted that the assessee had given his site for development, was purchased for a consideration of ₹ 6,60,000/- vide document dated 12/07/2004. The Assessing Officer further observed that site was purchased in July 2004 and was given for development in August 2005, hence, capital gain arising from transfer of site for development was held to be short term capital gain. The Assessing Officer further noted that the site transferred to the buil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be taxed in this subject year and confirmed the order of the Assessing Officer. 4. On being aggrieved, assessee carried the matter in appeal before the Tribunal. 5. Learned counsel for the assessee has submitted that the Assessing Officer has calculated the short term capital gains based on the unregistered document dated 24/08/2005 and actually there was no transfer took place on the basis of such unregistered document and submitted that if at all capital gain has to be taxed for the Assessment Year 2007-08 and not for the Assessment Year 2006-07. 6. On the other hand, the Departmental Representative has strongly supported the orders passed by the authorities below. 7. We have heard both the sides, perused the material availab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by him in 2004. It is not in dispute that the development agreement was unregistered one. The contention of the assessee is that transfer of rights in respect of an immovable property cannot take place under an unregistered document. It was argued that the purported transaction under the unregistered development agreement would not constitute transfer and consequently there would not be any capital gains. I have perused the copy of the development agreement. Para (6) of the terms of the agreement specify that the owner has delivered schedule mentioned property to the 1st party builder for construction of apartment. The developer has to get detailed plan, estimates and designs at his own cost and has to secure approval of building plan f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as argued that there was no 'transfer' under the development agreement and that the requisite of 'transfer for levy of capital gains had taken place only in the year of execution of sale deeds for apartments. It was also argued that no Power of Attorney was executed in favour of builder. I have considered the submissions and also perused the sale deeds. It is noted that the sale deeds to the purchasers of the apartments were executed by the assessee and the builder, in their capacity as vendors. If the builder had not acquired any interest in the subject immovable property, then he would not be referred as vendor in the sale deeds. If the builder was merely a licence he would not derive any interest in the subject property and w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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