2023 (4) TMI 567

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....acts and circumstances of the case, the Ld. CIT(A) ignored the fact that since the excess money of Rs.6 Crores could not be taxed under the head of Capital Gain as there was no transfer of any asset as contemplated u/s 2(47) of the Income Tax Act, 1961 and hence the same has to be taxed under the head of income from other sources u/s 56(2(ix) r/w section 56(1) as the sale of the property could not materialize. 2) On the facts and circumstances of the case, the Ld. CIT(A) ignored the fact that since assessee had not substantiated the genuineness and creditworthiness of the Buyer i.e. V A Realcom which had credited an sum of Rs.6 Crores in the account of the assessee, making the transaction a colorable device to evade taxes. ....

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.... covered u/s 51 of the Act, nor covered under the head "salary" or "Profit & Gains of Business/Profession" and It cannot even be taxed under the head income from other sources u/s 56(2)(vii) of the Act. Accordingly, the assessed a sum of Rs. 4,91,13,697/- under the head income from other sources and further disallowed depreciation of Rs. 3,60,903/- claimed by the assessee on building. 4. As against the assessment order, the assessee filed an appeal before the Ld.CIT(A). The Ld.CIT(A) relied on the Supreme Court Judgment in the case of Travencore Rubber & Tea Company Ltd. Vs. CIT (2000) 243 ITR 158 (S.C) and deleted the addition made by the A.O. vide order impugned dated 30.11.2017. 5. As against the order of the Ld.CIT(A) the Revenue ....

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....ying with the conditions of the agreement, an amount of Rs. 6 crores paid as advance sale consideration was forfeited by the assessee. As per the opinion of the AO section 51 applies only to the amount received by the assessee towards advance money/ part payment to the extent of cost of acquisition/ WDV of the asset and not the amount over and above thereof. Therefore, only the amount of Rs. 1,08,86,303/- out of amount of Rs. 6 crores was reduced it from cost of acquisition/ WDV of the asset and treated the balance amount as income from other sources u/s 56(2)(vii) of the Act. The ld CIT(A) while deleting the addition relied on the ratio laid down in the case of CIT Vs. Meera Goyal (2014) 360 ITR 346 (Del) thereby deleted the addition made ....

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....hat in the instant case there were negotiation for transfer of the rubber trees in question, which did not fructify in sale. The amount forfeited referred only to the capital asset of the assessee and were directly related to the sale of such capital asset. The Tribunal had correctly held that the advance money for sale of Tubber trees formed part of the capital asset of the assessee and that the sale, if materialized, would have resulted in a gain eligible to capital gain tax, provided there was a gain arising out of the same. 15. Delhi High Court in the case of CIT vs Meera Goyal (2014) 360 ITR 346 (Del) have observed that earnest money of 18 Cr forfeited by the assessee as provided in the agreement to sell dated 28.01.2007 received fr....

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....f 6 Cr by the appellant during the relevant PY from the buyer of its property has not been in doubt. The advance has come through banking channels. Further in view of the buyer's failure to honour the Agreement to Sell, the advance of 6 Cr was forfeited by the appellant." 18. In the absence of any contrary evidence it cannot be said that the transaction i.e. agreement to sell entered into by the assessee and the buyer is not proved and the buyer is genuine. Therefore, in our opinion the order of the ld CIT(A) in deleting the said addition requires no interference. Accordingly the Ground No. 2 of the Revenue is dismissed. 19. Insofar as depreciation of Rs. 3,60,930/- is concerned, it is admitted fact that the assessee has claimed t....