TMI Blog2019 (2) TMI 1351X X X X Extracts X X X X X X X X Extracts X X X X ..... : Shri Akhilesh Kumar Shri Vipin Garg, Advocates For the Respondent : Ms. Shaveta Nakra Dutta, Sr. DR ORDER PER BHAVNESH SAINI, J.M. This appeal by Assessee has been directed against the Order of the Ld. CIT(A), Muzaffarnagar, Dated 30.03.2018, for the A.Y. 2010-2011 on the following grounds : 1. Because the Ld CIT(A) has erred on facts and law in confirming the addition of ₹ 2,27,47,792/- as short term capital gain by erroneously holding the Date of Transfer to be 01.06.2009 (A.Y.2010-11) while the Date of Transfer as per law is 30.01.2009 (A.Y.2009-10) on which date i.e. 30.01.2009, the property being agricultural land was not a capital asset u/s 2(14) of the Income Tax Act and thus was out of purview of Sec. 45 of the Income Tax Act. 2. Because the Ld CIT(A) has erred on facts and law in confirming the addition of ₹ 2,27,47,792/- as short term capital gain by committing grave error on facts and law in not allowing the sum of ₹ 1,50,00,000/- being expenditure incurred wholly and exclusively in connection with the impugned transfer u/s 48 of the Income Tax Act 2. Brief facts of the case are that in this case return was fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k Jain. However, the claim of assessee was not accepted and found to be an afterthought, therefore, the amount of ₹ 1.50 crores paid to Shri Ashok Jain and shown as cost of improvement/transfer charges was disallowed. The A.O. computed the short term capital gain by taking the sale consideration of ₹ 3.72 crores and after deducting cost of acquisition of ₹ 1,44,52,208/- computed the short term capital gain of ₹ 2,27,47,792/-. 3. The assessee challenged the addition before the Ld. CIT(A). the Ld. CIT(A) called for the remand report from the A.O. and after examining the issue in detail, confirmed the addition on the same reasoning as given by the A.O. The Ld. CIT(A) accordingly dismissed the appeal of assessee. 4. We have heard the Learned Representatives of both the parties and perused the material available on record. 5. Learned Counsel for the Assessee on Ground No.1 submitted that provisions of Section 2(47)(vi) of the I.T. Act are applicable in this case. The date of transfer of property should be taken as 30.01.2009 when Agreement to Sell was executed between the parties and possession of the property was handed-over to the purchaser, subject to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 2(47) (v) or 2(47)(vi) was well within the domain of the Tribunal while deciding the appeal filed by the department. Thus, the submission of assessee that a new case was made out by the Tribunal cannot be accepted. [Para 26]. In view of the aforesaid, the Tribunal was fully justified in holding that agreement of sale dated 7/9/1991 amounts to transfer of capital assets by virtue of section 2(47)(vi). (ii) Order of ITAT, Chennai A-Bench, Chennai in the case of ITO, Ward-V(1), Chennai vs. Mrs. P.A. Sarala (2015) 154 ITD 168 (Chennai-Trib.), in which it was held as under : Where in terms of development agreement, assessee handed over physical possession of property to builder allowing it to enjoy 60 per cent of land in lieu of 40 per cent of constructed area, it was to be concluded that transfer took place in year in which said agreement was entered into. Where in terms of development agreement, assessee obtained multiple flats in lieu of cost of 60 per cent of land allotted to builder, still her claim for deduction under section 54F was to be allowed. (iii) Order of ITAT, Ahmedabad B-Bench, Ahmedabad in the case of Smt. Sapnaben Dipakbhai P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rights or rights to purchase the apartment or to obtain its letter was also capital asset. [Para 5] In the present case the question is not whether the assessee sold the booking rights and was, therefore, entitled to benefit of capital gains. It is, rather, whether his entering into the transaction and acquiring a property amounted to his acquiring a capital asset. In the light of the definitions of 'capital asset' under section 2 (14) and 'transfer' under section 2(47) as discussed in Gulshan Malik (supra), this Court has no doubt that the assessee's contentions were merited. [Para 6] (v) Judgment of Hon ble Madras High Court in the case of CIT, Salary Circle, Chennai vs., S.R. Jeyashankar (2015) 373 ITR 120 (Madras), in which it was held as under : Where assessee had entered Into an agreement with builder for purchase of undivided share of land and construction, date of allotment of undivided share in land was to be adopted as date of acquisition for computing capital gain instead of date of sale deed. 5.1. Learned Counsel for the Assessee, therefore, submitted that no capital gain could be computed in assessment year under appeal be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a share or shares of a company registered or incorporated outside India;] 7.1. Learned Counsel for the Assessee relied upon sub-clause (vi) to Section 2(47) of the I.T. Act which provides transfer in relation to capital asset in respect of any transaction by way of any agreement or any arrangement or in any other manner whatsoever which has the effect of transfer or enabling the enjoyment of any immovable property. The immovable property has been referred to as per Section 269UA of the I.T. Act which are referred to agreement for transfer would mean an agreement whether registered under the Registration Act or not for the transfer of any immovable property. According to Explanation-2 to Section 2(47) of the I.T. Act, the transfer would include and shall deemed to have always included disposing of or parting with an asset or any interest therein or creating interest in any asset in any manner whatsoever directly or indirectly, absolutely or conditionally, voluntarily or involuntarily by way of an agreement or otherwise. In the present case, the assessee has entered into an Agreement to Sell dated 30.01.2009 (PB-17) with M/s. Archit Steel (P) Ltd., in which it is provided t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er. What is necessary to be considered is the true nature of the transaction and whether in fact it has resulted in profit or loss to the assessee. 7.2. Merely showing the property in question as his assets in the balance sheet as on 31.03.2009 would not disentitle the assessee from relief because the part consideration was received on 30.01.2009 and other legal formalities of execution of sale deed shall have to be done in future and as such under the Civil Law title would remain in the name of assessee unless the sale deed is executed. However, it is not relevant while applying the provisions of Section 2(47)(vi) of the I.T. Act. The part-payment of sale consideration by cheque at the time of entering into an Agreement to Sell would show that Agreement to Sell is not an afterthought. The A.O. did not make any enquiry from the O/o. Stamp Collector to dispute the claim of assessee of purchase of the stamps genuinety. In sale deed Dated 01.06.2009, it is mentioned that possession is handed-over to the purchaser at the time of sale deed which was taken adverse by the authorities below to deny relief to the assessee. However, we may note that such usual writings are made by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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