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TMI Blog2024 (11) TMI 1297X X X X Extracts X X X X X X X X Extracts X X X X ..... engal Promoters Ltd., being developers. It is recorded that this agreement was in respect of a piece of land owned by the company in Anandapur, Kolkata. This agreement was registered with concerned authorities on 30.07.2013 where the market value of the said property was assessed by the Stamp Valuation Authority at Rs. 11,42,09,678/-. The revenue sharing agreed between the appellant and the developer was in the ratio of 50:50. On the basis of the value arrived at by the Stamp Valuation Authority, the Assessing Officer (hereinafter referred to as ld. 'AO') recorded in the reasons to believe that income to the tune of Rs. 5,71,04,839/- (being 50% of share) had escaped assessment. In light of this, a notice u/s 148 of the Income Tax Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re the ld. CIT(A) that the AO failed to consider that revenue sharing can happen only when a building was constructed, completion certificate was obtained and possession of flats were given to the buyers. Therefore, it was again emphasized that there can be no accrual of revenue until and unless the JDA could be fulfilled in letter. e) The appellant relied on the case of Pr. CIT vs. Infinity Infotech Parks Ltd. reported in [2018] 407 ITR 137 (Calcutta) and Pr. CIT vs. Shelter Project Ltd. reported in [2022] 445 ITR 291 (Calcutta). Through these case laws it was argued that no transfer within the meaning of Section 2(47)(v) of the Act would take place until the builder constructed the property and handed over a portion of the same to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rence to the original JDA and the fate of the same in the intervening period. 4. That the department craves leave to add, alter and amend, delete, substitute any of the grounds and / or take additional grounds before or at any time of hearing of this appeal." 2.1. It is noteworthy that the main grievance of the Department revolves around the ld. CIT(A) taking cognizance of the cancellation of JDA dated 08.07.2023, without going through the procedure enshrined in Rule 46A of the Income Tax Rules, 1962. As had been mentioned earlier, this agreement would not possibly have been before the ld. AO since it is at a later date than the date of passing of the assessment order. 2.2. The ld. D/R pointed out that the ld. CIT(A) has mentioned thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mments of ld. AO could have made any difference. 3.1. In this case, it would be worthwhile to recall that Rule 46A of the Income Tax Rules, 1962 is a mechanism to allow an appellant to place documents or facts before the ld. CIT(A), which could not be placed before the ld. AO for certain specified reasons. In case, such facts or documents are proposed to be placed before the ld. CIT(A) then the ld. CIT(A) is supposed to record reasons for accepting the same and also afford an opportunity for comments/rebuttal to the ld. AO. Admittedly, in this case the document under consideration was certainly not before the ld. AO and was placed before the ld. CIT(A), who has mentioned it in several places in the impugned order, without confronting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t would stand determined and cancelled and the developer shall cease to have any right, title, interest under the Joint Development Agreement and the developer shall be entitled to complete the construction of the incomplete portion of the housing complex provided however the assessee shall refund the entire outstanding amount of interest-free security deposit and the cost of construction of the said housing complex and the value of the construction shall be certified by the structural engineer and architects. Thereafter the Tribunal took note of the decision of the Supreme Court in the case of CIT v. Balbir Singh Maini [2017] 86 taxmann.com 94/251 Taxman 202/398 ITR 531. The said decision is more or less identical to the facts of the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of Balbir Singh Maini (supra). Regarding the issue discussed in 'b' (supra), also has to be answered in the negative considering that the profit from sale in stock-in-trade will arise in the year of actual sale to the prospective buyer only. In fact, this was also one of the facts in the case of Emporis Properties (P.) Ltd. (supra). Regarding issue discussed in 'c', it deserves to be mentioned that the document indicating cancellation of JDA has been used to demonstrate that while the JDA was not implemented even in the AY 2014-15, it was eventually cancelled due to legal and operational difficulties. Thus, even if we are to confine ourselves to the facts available for the AY 2014-15, it is clear that in that year the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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