2025 (12) TMI 622

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....The order of the Ld. CIT(A) in upholding the order of the Ld. AO u/s 153A is erroneous in law as well as in facts of the case. 2. The Ld. CIT(A) ought to have observed that there is no scope for invoking the provisions of section 45(1) of the IT Act and there should not have been any addition of Rs. 3,65,904/- towards capital gains. 3. The Ld. CIT(A) ought to have observed that it is a settled law that mere entering into development agreement cannot construe transfer of capital asset. 4. The Ld. CIT(A) has confirmed the addition without understanding the facts and circumstances, as well as settled law and various judicial precedents. 5. The Ld. CIT(A) ought to have considered the submissions of the Appell....

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....h the developer. As per the terms of the JDA, in lieu of land measuring 676 sq. yards, the landowners were entitled to receive 1853 sq. ft. of built-up area. The Ld. AO held that the execution of JDA on 19.01.2016 constituted a "transfer" within the meaning of section 2(47) of the Act and that capital gains under section 45(1) of the Act arose in the year of execution of JDA itself. The Ld. AO computed long-term capital gain of Rs. 3,65,904/- and added the same to the returned income of the assessee. Accordingly, the assessment under section 153A of the Act was completed on 26.04.2021 determining the total income of the assessee at Rs. 9,64,764/-. 4. Aggrieved with the order of the Ld. AO, the assessee preferred appeal before the Ld. CIT....

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....n is handed over only for limited purposes of development, no capital gains can be said to be accrued in the year of execution of JDA. Accordingly, the Ld. AR submitted that the addition made by the Ld. AO is liable to be deleted. 6. Per contra, the Learned Departmental Representative ("Ld. DR") relied upon the orders of the Ld. AO and the Ld. CIT(A) and supported the view that the signing of JDA itself constitutes transfer as per section 2(47)(v) of the Act. Accordingly, there is no infirmity in the order of the lower authorities. 7. We have considered the rival submission and perused the material available on record. The Ld. AR has contended that the assessee had not received any consideration whatsoever during the year of JDA and t....

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....er Section 2(47) of the Act. 18. Insofar as reliance placed by the learned Senior Standing Counsel for the Revenue in Potla Nageswara Rao (supra) is concerned, the same is an authority for the proposition that element of factual possession and agreement are contemplated as transfer within the meaning of Section 2(47) of the Act. It has further been held that when the transfer is complete, the consideration mentioned in the agreement for sale has to be taken into consideration for the purpose of assessment of income. In the instant case, under the development agreement there is no transfer and the consideration has also not been paid. Therefore, the aforesaid decision of the Division Bench has no application to the fact situation of....