TaxTMI 
TaxTMI 
2015 (6) TMI 920
X X X X Extracts X X X X
X X X X Extracts X X X X
....1 and 2003-04 at Medchal for an aggregate consideration of Rs. 2,35,36,015. It was seen that the assessee along with three other land owners promoted a venture by the name of 'Fabel County' with an intention to develop the land into plots and towards this end they made suitable applications before the concerned Urban Development Authority. Land use conversion fee as well as layout fee, for conversion of the land from agricultural to residential use and also for getting the layout plan approved, was paid. Out of the total land holding of ac.85.28 guntas the total land developed was ac.63.10 guntas and 112. Sq. yards equivalent to 306242 sq. yds. As per the HUDA approved plan, the net plot area was 167802 sq. yds and the same was sold....
X X X X Extracts X X X X
X X X X Extracts X X X X
....: "5. I have perused the detailed submission made by the assessee as well all documents on record. I am convinced that the land which was purchased between years 2000-01 to 2003-04 was a capital asset with an intention to hold on to the same. Mere application for change of land use shall not change the nature of the asset in the absence of any work carried out by the assessee to improve the land or to make such changes as would indicate that the assessee is now in the business of real estate. Hence, the assessment order u/s 143(3) r.w.s.147 dt.19.11.201O is found to be in order as far as the sale of 67563 sq. yds to Mr. V. Brahmananda Reddy and others for a consideration of Rs. 5,35,00,000 is concerned. However, as mentioned earlier, there....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... land. However, the assessee as stated earlier, has on the date of agreement decided the consideration to be received which is Rs. 1800 per sq. yd end hence the assessee has transferred his capital asset being his share in 60742 sq. yds of [end to VAPL. The assessee and his group has however offered surplus from sale of only 19574 sq. yds of land instead of the entire sales consideration for 60742 sq. yds of lend, The' Assessing Officer has accepted this computation of capital gains and hence his order is held to be erroneous in as much as it is prejudicial to the interests. of revenue. The assessment order dt.29.11.201O is hence set-aside with a direction to the Assessing Officer to compute the capital gains arising from sale of 60743 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ringing to tax the entire gain on agreement with VAPL, we are of the opinion that the stand of CIT cannot be supported. First of all, the agreement with VAPL is a GPA agreement without handing over possession. This stand gets support by the stamp duty paid and accepted by Registration authority. The agreement was registered as GPA agreement and not as a sale agreement. Thus on facts the agreement cannot be considered as sale agreement so as to bring entire capital gain tax in the impugned year. Moreover, there was a statement from Manager of VAPL recorded by A.O. during survey which indicate that there were lot of unsold plots and detailed statement was recorded about sale of various plots and how the monies are accounted. This indicates th....