Power of attorney does not transfer title, so capital gains cannot be assessed on an attorney holder without ownership transfer.

A registered power of attorney does not by itself transfer title in immovable property, and capital gains cannot be fastened on an attorney holder merely because he executed the sale deed for the principal owners. Where there is no registered conveyance in the assessee's favour and no evidence that possession or ownership was transferred to him, oral statements cannot override the registered power of attorney and supporting documents. On that basis, the attempted assessment of long-term capital gain in the hands of the attorney holder was unsustainable.

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Issues: Whether long-term capital gain arising from the sale of immovable property could be assessed in the hands of the assessee, who acted only as a registered power of attorney holder, and whether the addition based on the assessee being treated as owner was sustainable.

Analysis: The assessee's case was that he executed the sale deed only as an agent under a registered power of attorney for six principal co-owners and that there was no material showing transfer of title or possession to him. The finding turned on the legal character of a power of attorney and the requirements for transfer of immovable property. A power of attorney does not itself transfer title, and immovable property can be transferred only through a legally valid conveyance. In the absence of any registered transfer document in favour of the assessee, and with no evidence of possession being handed over to him, the oral statements relied upon by the revenue could not override the registered power of attorney and the other documentary material. The legal principles recognised in transfer of property law and the income-tax treatment of capital gains therefore did not support fastening ownership or tax liability on the assessee merely because he signed the sale deed as attorney.

Conclusion: The addition of long-term capital gain in the hands of the assessee was not sustainable, and the issue was decided in favour of the assessee.

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