TaxTMI 
TaxTMI 
2020 (5) TMI 52
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....uted. 2.1. The Ld. CIT(A) erred in considering the sale agreement dated 21- 03-2005 as the document on the basis of which the transfer took place when in fact para no.2 of the sale agreement clearly states that the amount of Rs. 6 crores paid by the purchaser was only an advance and hence it is not the final consideration. Further, para no.6 of the sale agreement provides that the seller was required to register the sale of the property with the Registrar within twelve months, but he has failed to do so. Accordingly, this sale agreement cannot be considered as the document for deciding whether or not any transfer of the capital asset took place. 2.2. The Ld. CIT(A) erred in ignoring the fact that survey nos. 203/3B (13.5 cents), 203/8 (5 cents) and 233/2 (34 cents) which were sold by the assessee as per the sale deed dated 09-12-2010 were not included in the sale agreement dated 21-03-2005. Accordingly, the transfer of the capital asset took place as per the sale deed dated 09-12-2010 and hence the resulting Long Term Capital Gain was correctly taxed in AY 2011-12 by the Assessing Officer. 2.3. The Ld. CIT(A) erred in holding that the impugned immovable property was not a cap....
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....the same tantamounts to part performance of the contract and transfer within the meaning of Section 2(47)(v) of the Act read with section 53A of Transfer of Property Act, 1882. Accordingly, the assessee pleaded that there was no capital gains that would arise in respect of the subject mentioned lands during the year under consideration. The assessee submitted that power of attorney holder had executed registration of sale deed in favour of M/s.Ragas Educational Society during the Financial Year 2010-11 with Sub- Registrar, Neelangarai. The assessee categorically stated that there was neither any sale of immovable property during this year by him, or his family members, nor receipt of any consideration during the year. The assessee also submitted that the assessee, being a minor during the relevant assessment year 2005-06 i.e. the year in which the agreement of sale was entered into, and accordingly, the agreement was entered into by assessee's father R.Gunaseelan on his own behalf and on behalf of two minor sons. The assessee also furnished the copy of scrutiny assessment order of R.Gunaseelan (assessee's father) framed under Section.143(3) of the Act on 30.11.2017 for the assessm....
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.... with M/s Ragas Educational Society. As stipulated under Clause-3 of the sale agreement, the possession was handed over and the entire sale consideration of Rs. 6 Crores was received. Since the appellant was then a minor, the relevant portion of the appellant's sale consideration was clubbed and declared as per Section 64, in..tjie hands of the appellant's father, Dr.R.Gunaseelan in AY 2005-06. The appellant's father, Dr.R.Gunaseelan filed his Income Tax Return with a mention of the said transaction in his capital account. Dr.R.Gunaseelan's return was selected for scrutiny and the assessment was completed by accepting the returned income in the scrutiny assessment order dated 30-11-2007 for the AY 2005-06. 4.3.2. The observations related to the AO's addition of LTCG of Rs. 2.49 Crores are summarized hereunder: Since the buyer of the aforesaid two land properties registered the sale deed on 9-12-2010? the transfer should be assessed in AY 2011- 12. From the sale deed registered, it is inferred that the ownership vested with the appellant till then. Perusal of the website of Tamilnadu Registration Department - TNReginet, shows that the land sold was classified as 'residential' ....
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.... has contended that the transfer of land was concluded in AY 2005-06 and the sale consideration was declared in the hands of the appellant's father, as the appellant was then a minor. The same was also accepted in the scrutiny assessment in the hands of the appellant's father. Therefore, the AO's addition of Long Term Capital Gain on the ground that transfer took place in AY 201 1-12 based on registration of sale by the buyer, is not legally tenable, the AR has argued. 4.3.4. In support of his contention, the AR has furnished the following particulars: ' (a) Copy of sale agreement dated 2 1-3-2005. (b) Copy of bank statement evidencing the receipt of sale consideration of Rs. 6 Crores in FY 2004-05. (C) Copy of written submission made by Dr. R. Gunaseelan dated 12- 11-2007 and 23-11-2007 before the AO during the scrutiny assessment proceedings in his hands in AY 2005-06. (d) Memo of computation of financials of Dr.R.Gunaseelan including the sale consideration of agricultural land. (e) Balance sheet of M/s Ragas Educational Society declaring purchase of the property in AY 2005-06, (f) Copy of confirmation letter from M/s Ragas Educational Society. (g) Copy of VAO Cer....
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....to the Registration Department's website is not acceptable as classification of land, six years later is not under the control of the appellant who handed overthe property in AY 2005-06. It is pertinent to note that the AO accepted the declaration of sale consideration of Dr.R.Gunaseelan, the appellant's father including the share of the appellant, in the scrutiny assessment for AY 2005-06. The balance sheet of the buyer, M/s Ragas Educational Society in AY 2005-06 clearly shows that even the buyer has declared the purchase of property which conclusively proves that the transfer was concluded in AY 2005-06. The appellant has also executed Power of Attorney on 17-10-2007 in favour of the buyer on his attaining majority which again proves that the transfer was already concluded in AY 2005-06. From the discussion in the foregoing paras, I have come to the following conclusion: (a) 'Transfer' of land was concluded in AY 2005-06 as per Section 2(24) r.w. Section 53A of Transfer of Property Act. (b) The appellant's father, Dr.R.Gunaseelan had declared the sale consideration of land in AY 2005-06 which has been accepted by the AO in his assessment order which proves that the relevan....
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....r framed in the hands of assessee's father for assessment year 2005-06 in support of his claim. 8. Ld. A.R. also placed on record the copy of assessment order framed in the hands of father R.Gunaseelan for the assessment year 2011-12 under Section.143(3) of the Act dated 31.03.2016 wherein during the course of assessment proceedings of father, a specific query was raised with regard to details of sale of agricultural land at Uthandi village during the assessment year 2011-12. The assessee thereon i.e. Shri R.Gunaseelan (assessee's father) had duly responded to the said query, vide letter dated 12.11.2007 filed before ACIT,Circle- 1,Chennai stating that the subject mentioned lands were only part of transfer in assessment year 2005-06 and also subject mentioned lands were only agricultural lands and hence out of the purview of definition of capital assets under Section.2(14) of the Act. The Ld. A.O.of assessee's father i.e. ACIT, Circle-1,Chennai was duly convinced by a certificate issued by Village Administrative Officer , who had certified that the subject mentioned lands are agricultural lands and accordingly did not proceed to make any addition in the hands of assessee's father ....