Registered sale deed completes transfer for capital gains; later payment disputes do not postpone taxability, subject to double-tax relief.

Registered sale deeds transferring immovable property completed the transfer for capital gains purposes under section 45 read with section 2(47), so taxability arose in A.Y. 2014-15 on execution and registration of the conveyance. Alleged non-receipt of full consideration, dishonour of cheques, delayed payment, or continued possession did not defer tax incidence where the registered deeds were neither cancelled nor annulled. However, if the same capital gain had already been offered and assessed in A.Y. 2016-17, the Assessing Officer was required to verify that treatment and grant consequential relief to prevent double taxation.

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Issues: (i) Whether capital gains arising from transfer of immovable property were taxable in A.Y. 2014-15 on execution and registration of the sale deed, despite alleged non-receipt of full consideration and retention of possession; (ii) whether, if the same capital gain had already been offered to tax in A.Y. 2016-17, consequential relief was required to prevent double taxation.

Issue (i): Whether capital gains arising from transfer of immovable property were taxable in A.Y. 2014-15 on execution and registration of the sale deed, despite alleged non-receipt of full consideration and retention of possession.

Analysis: The registered sale deeds executed on 12.04.2013 transferred ownership rights in favour of the purchasers. For the purposes of section 45 read with section 2(47) of the Income-tax Act, 1961, transfer stood completed on registration of the sale deed. Non-realisation of part of the consideration, dishonour of cheques, delayed payment, or subsequent disputes did not defer the incidence of capital gains taxation, and the registered conveyances were neither cancelled nor annulled.

Conclusion: The capital gain was rightly held taxable in A.Y. 2014-15, and the challenge on this ground failed.

Issue (ii): Whether, if the same capital gain had already been offered to tax in A.Y. 2016-17, consequential relief was required to prevent double taxation.

Analysis: The Revenue cannot tax the same income twice. If the impugned capital gain was already offered and assessed in A.Y. 2016-17, the assessment for A.Y. 2014-15 required suitable adjustment after verification of the earlier year's tax treatment.

Conclusion: The Assessing Officer was directed to verify the assessment in A.Y. 2016-17 and grant appropriate consequential relief, if warranted, to avoid double taxation.

Final Conclusion: The addition was sustained on the issue of the year of taxability, but limited relief was granted to ensure that the same capital gain is not taxed twice, resulting in a partly successful appeal for statistical purposes.

Ratio Decidendi: For capital gains purposes, a valid registered sale deed effecting transfer of ownership completes the transfer under section 2(47), and later disputes over consideration or possession do not postpone taxability unless the conveyance is cancelled or legally rescinded.

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