TaxTMI 
TaxTMI 
2014 (11) TMI 88
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....ion 50C of the Act to A.Y. 2004-2005 and thereby confirming the addition of Rs. 22,22,000/-. 2. Facts in brief as emerged from the corresponding assessment order passed u/s.144 r.w.s.147 of the IT Act dated 28.12.2007 were that the assessee in individual capacity has furnished the return declaring income from selling property. It was noted that one of the taxpayer, namely M/s.Siddhi Corporation had purchased a land from the assessee. That information was received by the AO. From the information received, it was noted that the date of transfer-deed was 30/07/2003. From the office record, the AO has further noted that the assessee had not filed the return for A.Y.2004-05. In consequence thereof, a notice u/s.148 was issued and the reasons for reopening were stated to be as follows:- "Smt. Sandhyaben Amrishbhai Purohit, is my assessee and has filed here return of income for A.Y. 2003-04 vide acknowledgement No.0721012513 dated 30/10/2003. Thereafter, the assessee has not filed return of income. The undersigned has got information that M/s.Sidhhi Corporation has purchased one immovable property from Smt.Sandhyaben A.Purohit as per sale deed dated 30/07/2003 for Rs. 12,00,000/- bu....
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....e of registration. In this connection, case law cited is Arundhati Balkrishna & Anr. Vs. CIT 138 ITR 245(Guj.) for the legal proposition that transfer is effective from the date of execution of document and not from the date of registration. Further, case laws cited are CIT vs. Vishnu Trading & Investment Co. 259 ITR 724 (Raj.) and CIT vs. Rajasthan Mirror Mfg. Co. 260 ITR 503 (Raj.). He has concluded that the capital gain was wrongly taxed in A.Y. 20045-05. 5. From the side of the Revenue, ld.Sr.DR Mr.D.K.Singh has placed on record a copy of the impugned document registered with the Sub- Registrar in support of the contention that the transfer of an immovable property is enforceable only from the date of Registration of the document. For this legal proposition, ld.DR has placed on record a decision of Hon'ble Supreme Court pronounced in the case of Suraj Lamp & Industries 14 Taxman.com 103(SC). 6. We have also been addressed by both the sides in respect of the possibility of making the assessment for A.Y. 2002-03. In this connection, a decision of Hon'ble Gujarat High Court in the case of Kalyan Ala Barot vs. M.H. Rathod (328 ITR 521)[Guj.] has been cited. The contention of ....
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....een informed that on the said date, i.e. on 21.5.2001, adhesive stamps of Rs. 1,24,800/- have also been purchased and duly affixed on the said deed. However, that deed could not be presented before the Sub-Registrar and later on the said deed was registered on 30/07/2003. On this issue, we have examined the provisions of section 2(47)(v) of IT Act which says that "transfer" in relation to a capital asset includes any transaction involving the allowing of the possession and establishment of any rights therein. In this regard, a well-known decision of Hon'ble Bombay High Court pronounced in the case of Chaturbhuj Dwarkadas Kapadia vs. CIT (2003) 260 ITR 491 (Bom) is worth mentioning. In the said decision, it was explicitly held that in a situation where consideration has been paid and the possession has been handed over, then in view of the provisions of section 2(47)(v) transfer took place and that date of transfer is thus required to be taken for the purpose of computation of capital gain. We therefore hold that the capital gain was required to be assessed in A.Y. 2002-03 and not in assessment year 2004-05. Although, from the side of the Revenue the decision of Suraj Lamp & Industr....
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....mmissioner (Appeals) in appeal for assessment year 1984- 85, the Assessing Officer had issued notice under section 148 for assessing the income which was excluded from the total income of the petitioner by the assessment year 1984-85, to assess such income for the assessment year 1983-84. Thus, the case fell within the ambit of the provisions of section 150 as well as section 153(3)(ii) read with Explanation 2 to section 153 of the Act and as such there was no infirmity in the action of the Assessing Officer in initiating reassessment proceedings, the same being in consonance with the provisions of law and within the prescribed time limit." 10. Respectfully following the view taken by the Hon'ble Jurisdictional High Court, we hereby direct the AO to compute the capital gain in A.Y. 2002-03 as per law after issuing a notice of hearing prescribed under the provisions of the Act. In support this direction, it is worth to reproduce the relevant section 150 hereinbelow :- SECTION 150 Provision for cases where assessment is in pursuance of an order on appeal, etc. (1) Notwithstanding anything contained in section 149, the notice under section 148 may be issued at any time for....