AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2020 (9) TMI 961
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....ause the assessment framed is wrong, bad in law and without jurisdiction as the approval/sanction as required u/s 151 of the I.T Act has not been obtained. The approval, if any, is a mechanical approval which is bad in law. On this legal ground also the assessment deserves to be quashed. 4. Because the Ld. CIT(A) has wrongly, illegally and arbitrarily confirmed the addition made by the Assessing Officer under the head Capital Gain -applying the provisions of section 50C of the I.T Act. 5. Because the Ld.CIT(A) while confirming the addition has erred both on facts and in law in rejecting the appellant's specific ground and submission on the issue. Since the appellant executed the sale deed as power of attorney holder which is not in dispute, the capital gain cannot be assessed in the hands of the appellant. 6. Because the Assessing Officer has made the addition under the head capital gain solely relying on the statement of the persons who executed the power of attorney in the favour of the appellant. Ld. CIT(A) while confirming the addition has legally erred ignoring the fact that the statement cannot be relied upon and cannot be made basis of addition until and unless the....
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.... appellant earlier for Rs. 2,50,000/- and they have not received the consideration in respect of the sale made by the appellant. 4. Therefore, the AO held that the appellant had sold the property as an owner and hence, the LTCG was assessable in his hands. On the basis of the available facts, the AO assessed the LTCG of Rs. 65,31,869/-. Thus, the assessment was completed at Rs, 65,31,869/-. 5. The Ld. CIT(A) without appreciating the facts and rejecting the assessee's specific submission confirmed the addition. 6. Feeling aggrieved by the order passed by the lower authorities the assessee is in appeal before us for the grounds stated hereinabove. 7. The ld. AR for the assessee had submitted that the addition made by the assessing officer and confirmed by the Commissioner appeal were provided on the wrong assumption that the assessee is the owner of the property. It was submitted that the assessee was merely the registered Power of Attorney holder, which was very workable and there is no mention of handing over of the possession to the assessee by 6 persons. It was further pointed out that there is no sale document on record which shows that the property was transferred by th....
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...., the Ld. AO recorded the statements on oath of all the six persons who were the original sellers of the land. In relation to it, following undisputed facts are laid herein:- a. The six persons denied the fact that had written any PoA in favor of the assessee. Instead they stated that they had executed sale deed in favor of the assessee for sale consideration of Rs. 2,50,000/-. b. The PoA writers stated that the land was sold to the appellant for Rs. 2,50,000/-. However, on the other hand, they denied that any amount was received to them by the appellant on the sale of land. c. They admitted in their statements that the photos affixed on the PoA and signatures thereon belonged to them but they signed the PoA believing it to be a sale deed. Refer statement of Shri. Shanti Swaroop in reply to question 5 of the AO - Page 44 of Paper book) d. The statement regarding no knowledge of the PoA and that executing the same as a sale deed is more than a lie. e. The persons were literate and educated enough evidenced by: Ø their signatures thereon the PoA (no one has put a thumb print pointing that they knew how to read and write) and thus could understand a document written i....
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....t to the Principal. E. Power of Attorney- Agent has been placed in a position of confidence; Fiduciary in respect of the property- He is a trustee to the Principal- Must prefer Interest of Principal to as own Bound to Account for all profits to the Principal. Sec. 212. Skill and diligence required from agent - An agent is bound to conduct the business of the agency with as much skill as is generally possessed by persons engaged in similar business unless the principal has notice of his want of skill. The agent is always bound to act with reasonable diligence, and to use such skill as he possesses; and to make compensation to his principal in respect of the direction consequences of his own neglect, want of skill, or misconduct. F. The case skill or diligence required is not that such the Agent in Fact Possesses. But such as is reasonabley necessary for performance of his undertaking as reasonably to be expected. - A property of stamp valueof 69 Lakhs is being sold for 10,00,000/- implies a lack of skill and contrary to Principals Interest- Not an Agent. G. A.O. relied on false statement of the original sellers and rejected the Assessee's Statement. In respect of Agency,....
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.... was more than 69 lakhs. Further we may mention that AO can not rely on the oral statement of the alleged seller , which is contrary to the written registered document POA. In our view contrary oral statement of a person can not be accepted contrary to the registered document unless it satisfy the requisite conditions as mentioned under Evidence Act, which in present case are missing. 12. It is a settled position of law and do not require much argument that the tax liability arising out of the long-term capital gain is required to be fastened on the registered owner of the property and not on the assessee who is merely a power-of-attorney order. We may also been to record that, the assessee has set up his case being that of the power Attorney holder, but the Assessing Officer has failed to bring on record the chain of the title document in the form of registered sale deed etc , which can prove that apprent was not real or in other words transfer took place within four corner of law by virtue of POA. In the present case needful has not been done by the assessing officer to bring on record the title of the assessee, by virtue of which the assessee became owner of the property . In t....
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....nsferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then, notwithstanding that where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefor by the law for the time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract: Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof. 11. In order that the provisions of Section 53A of the T.P. Act be attracted, first and foremost, the transferee must, in part performance of the contract, have taken possession of the prope....
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....nd things done by him and subject to the limitations contained in the said deed, the same shall be read as if done by the donor. A power of attorney is, as is well known, a document of convenience. Execution of a power of attorney in terms of the provisions of the Contract Act as also the Powers-of-Attorney Act is valid. A power of attorney, we have noticed hereinbefore, is executed by the donor so as to enable the donee to act on his behalf. Except in cases where power of attorney is coupled with interest, it is revocable. The donee in exercise of his power under such power of attorney only acts in place of the donor subject of course to the powers granted to him by reason thereof. He cannot use the power of attorney for his own benefit. He acts in a fiduciary capacity. Any act of infidelity or breach of trust is a matter between the donor and the donee." An attorney holder may however execute a deed of conveyance in exercise of the power granted under the power of attorney and convey title on behalf of the grantor. 15. Therefore, a SA/GPA/WILL transaction does not convey any title nor create any interest in an immovable property. The observations by the Delhi High Court, in A....