Capital gains on alleged land transfer remain unresolved where possession, consideration, and ownership facts were inconsistent.

Capital gains could not be safely sustained where the record left unresolved disputes on whether a completed transfer had occurred, including possession, receipt of consideration, ownership entries in the revenue record, and the land's alleged control by CIDCO. The inconsistent factual findings on ownership, possession, and the nature of the land, including its description as Watan land relevant to cost of acquisition, meant the tax consequence had not been properly examined. The matter was therefore remitted for de novo adjudication after considering the assessee's submissions and making necessary inquiries.

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Issues: Whether capital gains could be sustained on the alleged transfer of the land, and whether the assessment and appellate orders were vitiated by unresolved factual errors requiring fresh adjudication.

Analysis: The assessee disputed that there was a completed transfer, pointing to the absence of handed-over possession, disputed receipt of the full consideration, the revenue record showing ownership in the assessee's name on the relevant date, and material suggesting that the land was under CIDCO's control. The record also indicated that the land was described as Watan land, a circumstance relevant to the question of cost of acquisition. The factual findings recorded by the lower authorities were found to be inconsistent on the questions of ownership, possession, and the nature of the land, and these matters had not been properly examined before determining the tax consequence. In these circumstances, the existing findings could not safely support a final adjudication on capital gains.

Conclusion: The issue was not finally decided on merits and the matter was sent back to the Assessing Officer for de novo adjudication after considering the assessee's submissions and conducting necessary inquiries.

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