TMI Blog2023 (3) TMI 317X X X X Extracts X X X X X X X X Extracts X X X X ..... alekar case on identical facts namely compensation received by the assessee was treated as Long Term Capital Gain. Thus the Ld. A.O. requested the Audit Party to withdraw/drop the Revenue Audit Objection As relying on cases Smt. Abha Bansal [ 2021 (5) TMI 1001 - ITAT DELHI] and Indu Fine Lands (P.) Ltd. [ 2014 (8) TMI 862 - ITAT HYDERABAD] we have no hesitation in holding that the assessment order passed by the Assessing Officer is neither erroneous nor prejudicial to the interest of Revenue. It is been held by the Co-ordinate Benches of the Tribunal that compensation received by the assessee from the proposed building by way of allotment is actually extinguishment of a right in relation to capital asset, in view of the provisions of section 2(47)(vi) of the Act. This clearly falls within the definition of transfer and hence provisions of section 45 is applicable. Therefore the Revision proceedings initiated by the Ld. CIT (IT TP) is liable to be quashed. Thus, the grounds raised by the assessee are hereby allowed. - ITA No. 119/Ahd/2021 - - - Dated:- 24-2-2023 - Shri Waseem Ahmed , Accountant Member And And Shri T. R. Senthil Kumar , Judicial Member For the Assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m Retreat, having plot area of 4250 sq.ft with built up area of 2230 sq.ft. at a total consideration of Rs. 1,38,01,000/- subject to the approval of plans by the concerned authorities As per the arrangement the assessee has remitted Rs. 76,13,444/- comprising as under : A. Aug 02 .2005 INR Rs. 2 ,00 ,000 B . Aug 2 2,2005 $70 ,00 0 Rs.3 0,38 ,084 C . Sep 06 ,2005 $22 ,00 0 Rs. 9 ,59 ,860 D . Nov 09 ,200 5 $75,000 Rs.3 4,15 ,500 The qualification provision of Section 2(14) as capital asset is very much in existence in the current case of purchase of the intended asset. 2.2 The assessee having waited for the delivery and due possession of the said allotted property, by Adarsh Developers, who did not honor their commitment, took to legal redressal for the due possession/compensation of the underlying asset the property the subject matter of the discussion. The Assessee after taking necessary steps with other in similar problem in this scheme took to approaching the legal redressal. All the aggrieved parties approached the National Consumer Disputes Redressal Commission, New Delhi in redressing the Failed Contract by Adarsh Developers. 2.3 National Consumer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsider in this response an application under section 264, to your kind self, that the Assessment in treating as Capital gain be Altered to the Consideration as Compensation in whole and want it to be treated as Capital Receipt not liable to tax and pleads to amend the Assessment by giving this relief, and appropriately, grant him additional refund as there would no tax liability at all, if the all the consideration are considered as Capital receipt , as stated in the pronouncement in above 2.6 and 27. 2.4. The Ld. PCIT held that the income from Capital Gain can only be arisen if there is transfer of capital asset in the case of the assessee, there is neither capital asset in assessee's hand as far as booking of the Villa is concerned nor transferred of the said asset. Therefore the provisions of Section 45 of the Act will not be applicable in assessee's case. The A.O. has allowed benefit of indexation to the assessee without discussion findings in the assessment order as well as without making any verification of the claim by the assessee. The Assessing Officer failed to verify high ratio of refund by TDS u/s. 195. Thus the order passed by the Assessing Officer is an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee a fair, reasonable and adequate opportunity to present its case before Assessing officer. 4. Without prejudice the learned Pr. CIT failed to address the issue raised by the assessee that compensation received was in nature of capital receipt not liable to be taxed. Further, learned Pr. CIT failed to appreciate that where two views are possible revision u/s. 263 of the Act is not justified. 3.1. The Ld. Counsel submitted that during the original assessment proceedings pursuant to 142(1) notice dated 18.04.2017, the assessee filed the details to the Assessing Officer vide letter dated 01.06.2017 namely Return of Income for the Assessment Year 2015-16 assessee's status as Non-Resident as per the Performa along with the copy of the Passport, copies of the NRO Bank and NRE Bank Account with proper explanation and other properties details held by the assessee which are placed in page Nos. 31 to 44 of the Paper Book. After considering the details, the Ld. Assessing officer passed the assessment order accepting the claim of the assessee. Thus the order passed by the Assessing Officer is neither an erroneous order nor prejudicial to the interest of Revenue. The assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bh Residency allotted vide allotment letter dated 20/06/2008 is actually extinguishment of any right in relation to capital asset in view of the provisions of section 47 of the Act and falls in the definition of transfer and hence, result in capital gain chargeable under section 45 of the Act. It is a fact that assessee held this right for more than 3 years for a reason that this flats were subject to allotment vide allotment letter dated 20.06.2008 and assessee received compensation of rightly deleted addition made by the AO in regard to disallowance of the claim of the assessee disallowing deduction of long term capital gain under section 54 of the Act on the premise that the compensation received in income from other sources. We noted that the CIT(A) has rightly allowed the claim of the assessee and we confirm the same. 4.0 Thus in view of the above, the objection of the revenue audit is not acceptable. The reliance is placed on the following: (a) CBDT Circular No. 471 dated 15.10.1986 (b) CIT vs Ram Gopal [2015] 55 taxguru.in 536 (Delhi) 4.1 The revenue audit may thus, please be requested to withdraw the same. 3.2. However overlooking the above reply ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss the decision is held to be erroneous. Cases may be visualised where the Income-tax Officer while making an assessment examines the accounts, makes enquiries, applies his mind to the fact and circumstances of the case and determines the income either by accepting the accounts or by making some estimate himself The Commissioner, on perusal of the records, may be of the opinion that the estimate made by the officer concerned was on the lower side and left to the Commissioner he would have estimated the income at a figure higher than the one determined by the Income-tax Officer. That would not vest the Commissioner with power to re-examine the accounts and determine the income himself at a higher figure. It is because the Income-tax Officer has exercised the quasi-judicial power vested in him in accordance with law and arrived at a conclusion and such a conclusion cannot be termed to be erroneous simply because the Commissioner does not feel satisfied with the conclusion. It may be said in such a case that in the opinion of the Commissioner the order in question is prejudicial to the interests of the Revenue. But that by itself will not be enough to vest the Commissioner with the po ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ows: ...Section 45_. read with sections, 2(47) and 263, of the Income-tax Act, 1961 Capital gains Chargeable as (Revision) - Assessment year 2017-18 Assessee had entered into a Builder-Buyer Agreement (BBA) for allotment of a villa - On builder's failure to give possession of villa to assessee within stipulated time, BBA was cancelled - Assessee received compensation for same and showed it as capital receipt chargeable to tax as capital gain under section 45-Assessing Officer accepted same -Commissioner invoked revisionary powers under section 263 on ground that such compensation received by assessee was revenue in nature and Assessing Officer had passed impugned assessment order without making sufficient enquiry-It was noted that copies of show cause notice, order-sheets, replies submitted by assessee along with documentary evidences during original proceedings showed that Assessing Officer had examined issue in detail after conducting detailed enquiry- Whether since entire material on record clearly showed that Assessing Officer had applied his mind before passing impugned assessment order and accepting claim of assessee, even if details of enquiry were not mentioned in ..... 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