Unregistered agreement to sell cannot trigger deemed transfer under section 2(47)(vi) without section 53A protection.

After the 2001 amendment, an unregistered agreement to sell could not be relied on to invoke section 53A of the Transfer of Property Act, so no deemed transfer arose under section 2(47)(vi) of the Income-tax Act on that basis. Because actual possession had not been handed over under the agreement, the sale deed date was treated as the relevant transfer event for capital gains purposes. The matter was remitted for fresh consideration in light of the Supreme Court ruling on registration, so no final substantive determination on the capital gains issue was affirmed in this order.

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Issues: Whether the assessee's unregistered agreement to sell, coupled with the surrounding facts, constituted a transfer under section 2(47)(vi) of the Income-tax Act, 1961 read with section 53A of the Transfer of Property Act, 1882 so as to tax the capital gains in assessment year 2010-11.

Analysis: The property was under a long lease and actual possession had not been handed over under the agreement to sell. The agreement was not registered, and after the 2001 amendment to section 53A of the Transfer of Property Act, 1882, and the corresponding registration requirement under section 17(1A) of the Registration Act, 1908, an unregistered contract could not be relied upon for part-performance protection. In these circumstances, the sale deed executed on 27.04.2009 became the relevant transfer event. The matter was, however, required to be reconsidered by the first appellate authority in the light of the Supreme Court ruling on the registration requirement.

Conclusion: The transfer was not established on the basis of the unregistered agreement to sell, and the capital gain was referable to the sale deed date. The issue was remitted for fresh adjudication, with the Revenue obtaining only a partial success.

Final Conclusion: The appeal succeeded only to the extent that the matter was sent back for reconsideration, and no final substantive relief on the capital gains issue was affirmed in this order.

Ratio Decidendi: After the 2001 amendment, an unregistered agreement cannot be used to invoke section 53A of the Transfer of Property Act, 1882 for a deemed transfer under section 2(47)(vi) of the Income-tax Act, 1961.

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