TMI Blog2017 (9) TMI 644X X X X Extracts X X X X X X X X Extracts X X X X ..... cer is further directed to allow the deduction/benefit of ₹ 50,00,000/- under Section 54EC and 54F after verification of facts. Thus the grounds of appeal raised by assessee are allowed. - ITA No.3557/Mum/2014 - - - Dated:- 18-8-2017 - SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER For The Assessee : Shri Aditya Ajgaonkar (AR) For The Revenue : Shri Suman Kumar (DR) Order Under Section 254(1) of Income Tax Act PER PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by assessee u/s 253 of the Income Tax Act (the Act) is directed against the order of ld. CIT(A)-27, Mumbai dated 28.02.2014 for Assessment Year 2010- 11. The assessee has raised the following grounds of appeal: 1. Additions by treating the Long Term Capital Gain of ₹ 2,34,55,080/-. ( a) Commissioner of Income Tax Appeals erred in confirming the additions of ₹ 2,34,55,080/- by treating the Long Term Capital Gain as Short Term Capital Gain on sale of residential property. ( b) Appellant prays that above additions of ₹ 2,34,55,080/- be deleted. 2. The appellant craves to add, amend or alter any of the above ground of appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of Occupancy Certificate and accordingly the gain arising out of sale of flat was treated as STCG instead of LTCG, the ld. CIT(A) confirmed the action of AO holding that assessee himself claimed on 06.11.2006 as date of acquisition from the builder. The NOC was availed on 18.09.2009. The ld. CIT(A) also concluded that assessee has intentionally and deliberately waited for mechanical lapse of 36 months and deliberately put the agreement dated 16.11.2009 to avoid the payment of tax to substantiate his argument, the ld. AR of the assessee further relied upon the section 2(47) of the Act which deals with the definition of transaction. 4. On the other hand the ld DR for the revenue supported the orders of authorities below. It was argued that the assessee acquired right in the property is only on the date of registration of the agreement and not from the date of booking. The agreement was registered on 16 November 2006. In support of his submission the learned DR for the revenue relied upon the decision of Hon ble Delhi High Court in Gulshan Malik Versus CIT ( ITA No. 55/2014) dated 14 March 2014. In the rejoinder arguments the learned and AR of the assessee submitted that the dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to sale in favour of purchase on 18th Nov2009; however the stamping on the said agreement is of 6th November 2009. The Assessing officer concluded that the transaction of sale of said flight was factually done on 06 November 2009. The assessee has purposely put the date of acquisition of the said agreement as 18th November 2009, with a view to make the Long-term Capital Gain. With these observations the assessing officer treated the Capital Gain as Short-Term Capital Gain and disallowed exemption under section 54EC and 54F. 6. We have seen that the revenue has not disputed the date of execution of agreement to sale dated 16.11.2006, executed by builder in favour of the assessee. The revenue has two fold objections. Number one that the assessee acquired the right in the property only on registration of the agreement on 06.10.2007and not on 16.11.2006. Secondly, while executing the agreement to sale in favour of buyer, the assessee has intentionally waited till 18.11.2009, though the stamp duty was paid on 06.11.2009. The ld. CIT(A) also concluded that assessee has intentionally and deliberately waited for mechanical lapse of 36 months and deliberately put the date on agreement ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in the assessee only once the buyer's agreement of 4.11.2004 was signed, thus making the profits from sale taxable as short-term capital gains. 6. It would be appropriate to extract Section 2(14), 2(42A), 2(47) here in relevant part. Section 2 of the Act reads: 2. In this Act, unless the context otherwise requires, - (14) capital asset means property of any kind held by an assessee, whether or not connected with his business or profession, but does not include - xxx (42A) short-term capital asset means a capital asset held by an assessee for not more than thirty-six months immediately preceding the date of its transfer: xxx (47) transfer , in relation to a capital asset, includes, - (i) the sale, exchange or relinquishment of the asset ; or (ii) the extinguishment of any rights therein ; or (iii) the compulsory acquisition thereof under any law ; or (iv) in a case where the asset is converted by the owner thereof into, or is treated by him as, stock-in-trade of a business carried on by him, such conversion or treatment ; or (iva) the maturity or redemption of a zero coupon bond ; (v) any transaction involving the allowing of the poss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. However, even while this Court agrees with the submissions of the appellant, it is pertinent to note that this question does not arise in these facts. Neither the CIT-(A) nor the ITAT have held that a capital asset can only be title to/ownership of the apartment. The order of the CIT-A locates the source of the booking rights i.e. date of acquisition of capital asset as the buyer's agreement dated 4.11.2004, which finding is subsequently confirmed by the ITAT by additionally relying on the receipts at the time of confirmation of allotment. Thus, in these facts, the question of whether the booking rights are a transferable capital asset is not contentious. The judgment in Ved Parkash (supra) is also consequently of no assistance in this matter since the reasoning therein turns on whether capital asset refers only to title to property as opposed to other rights/interests in the property. 8. This being the case, the only question that arises for consideration is whether the booking rights to the apartment accrued to the assessee on the date of application for allotment/confirmation of allotment or on the date of execution of the agreement to sell i.e. the buyer& ..... X X X X Extracts X X X X X X X X Extracts X X X X
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