Unregistered power of attorney cannot by itself create a transfer for capital gains under section 2(47)(v).

A transfer under section 2(47)(v) of the Income-tax Act arises only where the arrangement qualifies as part performance under section 53A of the Transfer of Property Act. After the 2001 amendment, that requires a written and registered contract, read with sections 17(1A) and 49 of the Registration Act. An unregistered power of attorney is only an agency document and does not by itself effect a conveyance. On the facts discussed, there was no registered agreement for sale in the relevant year, so possession or construction activity based on unregistered documents did not create a legally effective transfer. Capital gains were therefore not chargeable in assessment year 2012-13.

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Issues: Whether the transaction involving an unregistered power of attorney and a later unregistered sale agreement amounted to a transfer under section 2(47)(v) of the Income-tax Act, 1961 so as to attract capital gains in the assessment year 2012-13.

Analysis: For section 2(47)(v) to operate, the transaction must answer the description of part performance under section 53A of the Transfer of Property Act, 1882. After the 2001 amendment, the contract for transfer must be in writing and registered for section 53A to have legal effect, read with sections 17(1A) and 49 of the Registration Act, 1908. On the facts found, there was no registered agreement for sale during the relevant year, and the power of attorney was only an agency instrument and not a conveyance. The Tribunal therefore held that possession or construction activity based on such documents could not by itself constitute a legally effective transfer for capital gains purposes.

Conclusion: The alleged transfer did not fall within section 2(47)(v), and capital gains were not chargeable in assessment year 2012-13.

Final Conclusion: The assessee succeeded on the core issue, and the addition of capital gains for the relevant year was deleted.

Ratio Decidendi: A transfer under section 2(47)(v) requires a legally enforceable contract capable of attracting section 53A of the Transfer of Property Act, 1882, and an unregistered arrangement or a mere power of attorney cannot by itself constitute such a transfer.

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