TaxTMI 
TaxTMI 
1986 (11) TMI 104
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....cheme and was in absolute possession thereof by virtue of DDA's letter No. F. 14(139)/69. HB dt.19th Aug., 1969on hire purchase basis. (ii) The lease for the land under the appurtenant to the flat commenced w.e.f.19th Aug., 1969. (iii) The intending vendor (the assessee) had paid all the monthly instalments in entirety towards the cost of the aforesaid and the land underneath to the DDA. (iv) The DDA under the terms of hire purchase agreement entered into with the intending vendor was bound to execute a conveyance deed in respect of the said property in his favour after receiving the entire sale consideration stipulated by the DDA, in its letter dt.19th Aug., 1969. (v) The assessee has already applied to the DDA for such a conveyance deed. (vi) That the assessee agreed to convey to the intending vendor (Usha Manuja) by way of conveyance of all his rights, title and interest of Usha Manuja in the aforesaid property under the following terms: (a) The assessee to convey and transfer by way of a conveyance all his rights, title and interest in the said property for a consideration of Rs. 40,000 to Usha Manuja. (b) The assessee declared the property to be free of de....
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....ng the relevant previous year he had not disclosed any income from this property. He claimed that under the agreement for sale dt.13th April, 1978, he had delivered the possession of the flat to Usha Manuja and hence no income was assessable, in his hands for this year. The ITO, however, brought such income to assessment in the assessee's hands on the ground that no sale deed having been executed the ownership of the flat still remained with the assessee. The assessee appealed against this contending that he was never the legal owner of the property as the DDA itself had not executed a conveyance deed in his favour. The matter went upto the Tribunal. The Tribunal restored the matter for fresh consideration to the authorities below. 4. Following the directions of the Tribunal, the ITO considered the assessee's claim that pending execution of a conveyance deed by the DDA, the assessee had never been the legal owner and hence was not liable at all for assessment under the head "Income from House Property" as regards the flat in question. Relying on the decision in R.B. Jodhamal Kuthiala vs. CIT (1971) 12 ITR 570 (SC) and Addl. CIT vs.U.P.StateAgro Indus. Corpn. Ltd. (1981) 20 CTR (....
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....cancellation by satisfaction or otherwise, of all or any of the bundle of rights-qualitative or quantitative-which the assessee has in a capital asset, whether such asset is corporeal or incorporeal. However, according to the Court in order to subject any profit or gain respectively or accruing to the assessee to capital against tax, the necessary condition was that the receipt or accrual must have originated in a transfer within the meaning of s. 45 r/w s. 2(47) i.e. There must be a casual nexus between the transfer (the extinguishment of any rights in capital asset) and the profit or gain accruing to or received by the assessee. The AAC, in the light of this exposition, held tha the assessee transferred his right, title and interest in the property to Usha Manuja by the agreement for sale on13th April, 1978, a vacant physical possession was handed over to Usha Manuja. The AAC was also of the view that the decision in Hansraj Gupta (1982) 28 CTR (Del) 92 : (1982) 137 ITR 195 (Del) would not apply to the facts of the instant case, because in that case the property deed was registered in the name of the assessee seller and only a resolution was passed by the vendee company for the p....
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....gainst would have to be assessed twice on the transfer of the same property-once on the transfer during the relevant previous year and the other in the year which the assessee is able to execute a deed of sale in favour of Usha Manuja and have it registered. This, according to Shri Agnihotri, shows the inherent weakness in the approach of the authorities below. He submits that there was no question of taking the capital gains this year. 7. Shri D.K. Sharma, departmental representative on the other hand, supported the reasoning of the authorities below. He emphasised specially that many of the decisions relied upon for the assessee had been given under the Act of 1922 which did not carry such a comprehensive definition of the word "transfer" as found in s. 2(47). He referred in particular, to the decision in CIT vs. Tata Services Ltd. (1980) 13 CTR (Bom) 227 : (1980) 122 ITR 594 (Bom). The Court explained there that under s. 2(14) of Act, a capital asset means property of any kind held by the assessee being a word of the widest amplitude. Any right which can be called property will be included in the definition of "Capital asset" e.g. a contract for sale of land is capable of spe....