Registered transfer and possession are essential before immovable property rights can trigger capital gains under section 2(47).

Capital gains under section 2(47) did not arise because the assessee's rights in the immovable property were neither transferred nor extinguished during the relevant year. The court treated the absence of registered sale deeds as fatal to any claim that title had passed, and held that mere agreements to sell and receipt of consideration did not complete a transfer. It also accepted the Tribunal's factual finding that no actual or constructive possession was delivered, so part performance was unavailable. Relinquishment of rights in immovable property likewise required a registered instrument, and no statutory or transactional basis for extinguishment was shown.

---

---

Issues: Whether, on the facts, the assessee's rights in the immovable property stood relinquished or extinguished so as to attract capital gains under section 2(47) of the Income-tax Act, 1961.

Analysis: The agreements to sell were not followed by registered sale deeds. The court treated the absence of registration as fatal to the claim that ownership or title had passed, and held that mere execution of agreements and receipt of consideration did not amount to completed transfer. It also found, on the Tribunal's factual finding, that neither actual nor constructive possession had been delivered to the intended purchasers, so the plea based on part performance did not survive. On the concept of relinquishment, the court held that such relinquishment of rights in immovable property likewise required a registered instrument. As to extinguishment, no statutory or transactional basis was shown for any extinguishment of the assessee's rights during the relevant previous year.

Conclusion: The assessee's rights were not relinquished or extinguished during the relevant year, and no capital gains arose on that basis.

---