Registered sale deed and transfer of possession can trigger capital gains tax despite later reversal deed.

A registered sale deed reciting delivery of vacant and peaceful possession, receipt of full consideration, and transfer of ownership was treated as a transfer of a capital asset under section 2(47)(i) of the Income-tax Act, 1961. The assessee's claim that possession was not actually handed over, and that the transaction was later reversed by a subsequent registered deed, was not accepted because no fraud, invalidity, or other reliable material displaced the contents of the registered instrument. Oral assertions and a belated purchaser affidavit could not override the legal effect of the original deed. The transaction was therefore regarded as taxable, and the long-term capital gain addition was sustained.

---

---

Issues: Whether the sale of the land constituted a transfer of a capital asset so as to attract capital gains tax, notwithstanding the assessee's plea that possession was not actually handed over and the transaction was later reversed by a subsequent registered deed.

Analysis: The registered sale deed recorded that vacant and peaceful possession had been handed over, the full sale consideration had been received, and the purchaser became the owner. The assessee did not establish fraud, invalidity, or any reliable material to displace the contents of the registered documents. The subsequent registered deed and the belated affidavit of the purchaser did not outweigh the legal effect of the original sale deed. Oral assertions inconsistent with the registered instrument could not discredit its terms in the absence of legally cognizable grounds to do so. On these facts, the transaction satisfied the ingredients of transfer under section 2(47)(i) of the Income-tax Act, 1961.

Conclusion: The transaction amounted to a taxable transfer and the addition towards long-term capital gain was correctly sustained.

---