TaxTMI 
TaxTMI 
2016 (4) TMI 339
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....assessee is a partner in M/s. Sree Projects and Director in M/s. Swadesh Villas Pvt. Ltd. Assessee has 5% share in M/s. Sree Projects and 9% shareholding in the company. Consequent to settlement between the parties by an agreement dt. 11-02-2008, there was settlement among the directors by which there was an understanding to pay certain amounts of cash and also allot 10,400 Sq. Yds., of land for surrendering the interest in the company. Assessing Officer (AO) brought to tax the entire amount of Rs. 2,25,53,054/- as per his valuation of consideration received/receivable by assessee. It was contended before the Ld. CIT(A) that entire amount is not taxable and even if it is taxable, it is taxable in AY. 2008-09 as the agreement was dt. 11-02-2....
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....d sold was 8894 sq.yds, balance land remaining is 1506 sq.yards. the appellant states that this land is still in the name of M/s.Swadesh Villas Pvt. Ltd. He also submitted a copy of letter dated 16.10.2014 issued by Sri R. Srinivasulu, Managing Director of Swadesh Villas Pvt. Ltd. which read that the land of 1506 square yards is still in the name of the company and plots will be registered in favour of Mr.W.Ramana Rao on request. 4.2 It was submitted by the appellant that they have entered the business during real estate boom and carried out real estate ventures in and around Shadnagar. It was further submitted that after purchasing the land at Gudur Village, Kottur Mandai, Mahaboobnagar district, and after developing layout, they have r....
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....fered for A.Y.2008-09 and rest of the amounts would be offered on receipt basis. Despite of the categorical statement by the assessee the Assessing Officer made the addition of Rs. 2,25,55,305/- (Rs. 2,35,00,000 - Rs. 9,46,946) on the ground that the assessee failed to prove that he did not receive money". 4. Ld. CIT(A) after considering the submissions of assessee decided the issue as under: "5. 1 have carefully considered the factual position of the case. The issues for consideration are : (i) Whether there is any transfer of shares by the appellant to M/s. Swadesh Villas Pvt. Ltd. (ii) If there is a transfer of shares, what is the sale consideration to be adopted for computing the capital gains. 5.1 The provisi....
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....n any asset in any manner whatsoever, directly or indirectly, absolutely or conditionally, voluntarily or involuntarily, by way of an agreement (whether entered into in India or outside India) or otherwise, notwithstanding that such transfer of rights has been characterised as being effected or dependent upon or flowing from the transfer of a share or shares of a company registered or incorporated outside India;)" From the preliminary reading of the term 'transfer' as defined in the Act, the appellant is hit by the provisions of section 2(47) (i), (vi) and Explanation 2. Therefore, he received cash and land in lieu of the transfer of shares / for surrendering his interest in the company. Vide the agreement dated 11.02.2008 there ....
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....ax for the AY. 2008-09 instead of AY. 2009-10. 3. The learned CIT(A) ought not have reduced the consideration received while settlement deed clearly specified the amount for which the rights were given up by the assessee. 4. The learned CIT(A) ought not have directed the AO to adopt the SRO value as the entire consideration is required to be considered for taxation". 6. After considering the rival contentions and perusing the evidence on record, we do not see any reason to interfere with the order of the Ld. CIT(A). There is no merit in Revenue's grounds as the said settlement was entered on 11-02-2008 which falls in AY. 2008-09 and not in 2009-10. Just because a survey was conducted and statement was recorded, the amount cannot be....