TaxTMI 
TaxTMI 
2025 (12) TMI 911
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....e AO and against the said order, the assessee is in appeal before us. 3. During the course of hearing, the Ld. AR submitted that during the financial year relevant to the impugned assessment year, the assessee has entered into an agreement to sell three properties and the respective agreements were also registered before the Sub- Registrar, Mumbai. It was submitted that as against the agreed sale consideration mentioned in the respective agreements, the assessee has received only partial consideration ranging between 5% to 13% during the financial year relevant to the impugned assessment year and the possession of the property was also not handed over to the respective buyers. In this regard, our reference was drawn to the following chart, disclosing the amount of consideration which has been received upto 31-03-2015 and the remaining consideration which has been received during the FY. 2017-18 relevant to the AY. 2018-19: S. No. Chheda Arcade Unit No. Date of Agreement for sale Agreement Value in Rupees Amount received up to 31.03.2015 Balance Amount received - 01.04.2017 to 31.03.2018 1 305 07.12.2014 55,00,000 5,00,000 50,00,000 2 309....
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....(3) of the agreement provides that after full payment of consideration, the construction shall be undertaken by the developer. Admittedly, on the date of execution of the development agreement, the entire consideration was not received by the respondent-assessee. The physical possession of the property subject matter of development agreement was parted with by the respondent-assessee on 1st March, 2008. It was held that on that day, complete control over the property was passed on to the developer. After having perused the various clauses in the agreement and the aforesaid factual aspects, the Tribunal has taken 1st March, 2008 as the date of transfer. This finding is fully consistent with the law laid down by the Division Bench in the case of Chaturbhuj Dwarkadas Kapadia (supra). Therefore, no fault can be found with the impugned judgment of the Tribunal when it was held that the investment made in the sum of Rs. 50,00,000/- by the respondent-assessee on 22nd August. 2008 was within the period specified under Section 54EC of the said Act." 6. Further reliance was also placed on the decision of the Co-ordinate Bench of the Mumbai Tribunal in the case of Ashok M. Seth vs. DCIT, i....
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....formalities were complete. Further, the obligation about the maintenance of the property was also retained by the assessee till the Flat was transferred by the society in the name of the purchasers. 10. Thus, overall facts of the case indicate that sale could not have been said to be completed in absolute terms in the year 2009. For completion of sale in absolute terms fulfilment of all the three conditions mentioned above are must i.e., execution and registration of conveyance deed, handing over of possession and payment of full consideration. In the case before us, only first condition was completed and the remaining two conditions were still pending to be executed and were not completed in the impugned year. In addition to that, all the legal formalities for effecting the transfer of the property in the name of purchaser were also not complied with and the same were completed only after payment of maintenance charges by the assessee to the said society. The said flat came into full and exclusive control of the new purchasers only after when the possession of the same was handed over to them by the assessee on 26th June, 2011. Thus, the said flat was available for enjoym....
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....on and avoidable hardship to the assessee, Therefore, keeping in view the peculiar facts and circumstances of this case and in the interest of justice and all fairness we direct the AO to delete the addition. As a result, ground 1 is allowed." 7. It was further submitted that in the FY. 2017-18 relevant to AY. 2018-19, the assessee has received the balance sale consideration and possession was also handed over to the buyers. It was submitted that in the return of income filed for the AY. 2018-19, the assessee has duly offered the Long Term Capital Gain on sale of three properties amounting to Rs. 1,06,43,565/-. It was submitted that the said return of income has since been processed and accepted by the Revenue in terms of order passed u/s. 143(1) of the Act, dt. 16-04-2019. It was stated at the Bar that though the figure of long term capital gains of Rs. 1,06,43,565/- has been determined taking into consideration cost of acquisition without indexation (though the assessee is eligible for indexation) and is at a higher figure than the figure of Rs 80,76,511/- determined by the AO for the impugned assessment year 2015-16, the assessee has not and will not challenge the same and ha....
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....ment provides that the vendor shall hand over to the purchaser all the other documents/papers relating to the said office in their possession after the payment of the full consideration. During the financial year relevant to impugned assessment year, admittedly, the assessee has only received part consideration in the range of 5% to 13% of total agreed consideration and thus, the condition so specified has not been fulfilled. A fact which has been confirmed by the respective buyers in their separate communication, wherein they have confirmed that they have not paid full consideration and they have not taken over the possession over the property. In light of the same, we are of the considered view that the transfer of capital asset has not happened in respect of properties under consideration during the financial year relevant to impugned assessment year 2015-16 and chargeability to tax therefore doesn't arise for consideration. 10. We further find merit in the alternate contention of the Ld.AR that where the full sale consideration has been finally received in subsequent financial year 2017-18 and capital gains arising on transfer of the property have been duly offered to ta....