2026 (4) TMI 552

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....ot justified in upholding reopening of the assessment of the Appellant under section 147 of the Income Tax Act 1961, on the basis of incomplete information and on the premise that long term capital gain is exigible to tax for the assessment year 2016-2017, in respect of development agreement entered into on 10th July 2015, registered as document No.5930/2015 by four co-owners, wherein the subject land was stock in trade. 3. On the facts and circumstances of the case and in law :- (i) The Ld.CIT(A)/NFAC erred in conforming the long term capital gain at Rs. 12,47,22,564/- on the basis of development agreement, where the land subjected to development agreement was stock in trade and not capital asset. (ii) The Ld.CIT(A) ought to have appreciated that in respect of three co-owners on similar facts, in relation to the said development agreement, where the assessment was reopened and assessments have been completed on "Nil" income, holding that there is no Income accruing to the appellant by way of "Capital Gains", based on the decision of Apex Court in the case of Balbir Singh Maini (251 Taxman 202) (2017) and therefore the assessment of long term capital gain....

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....f income on 29.04.2021 admitting the same total income of Rs. 16,31,790/- as declared in the original return filed under section 139 of the Act. During the course of reassessment proceedings, the Ld. AO observed that the assessee had entered into a JDA dated 10.07.2015 with M/s Jeedimetla Residential Homes Private Limited along with three other land owners. According to the Ld. AO, the assessee was entitled to 20% share in the transaction arising out of the said JDA. The Ld. AO therefore computed an amount of Rs. 12,47,22,564/-as long-term capital gain in the hands of the assessee on account of the said JDA. Accordingly, the Ld. AO completed the assessment under section 147 read with section 144B of the Act on 18.05.2023 determining the total income of the assessee at Rs. 12,63,54,350/-. 4. Aggrieved by the order of Ld. AO, the assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) dismissed the appeal of the assessee and confirmed the addition made by the Ld. AO. 5. Aggrieved by the order of the Ld. CIT(A), the assessee is in appeal before this Tribunal. At the outset, the Learned Authorised Representative ("Ld. AR") submitted that the solitary issue arising out of t....

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....ssions and perused the material available on record including the case laws relied upon. The addition in the present case arises on account of the JDA dated 10.07.2015 entered into by the assessee with M/s Jeedimetla Residential Homes Private Limited. We have gone through page nos. 1 and 2 of the JDA placed in the paper book, which is to the following effect: 8. On perusal of the above, we find that A. Bhaskar Raju, D. Srinivasa Raju and D. Satyanarayana Raju are also land owners and parties to the same JDA along with the present assessee. We have also gone through the assessment orders passed by the Ld. AO in the cases of A. Bhaskar Raju and D. Satyanarayana Raju for Assessment Year 2016-17 placed at page nos. 66 to 73 of the paper book. On perusal of the same, we find that the Ld. AO has accepted that no transfer has taken place on account of the said JDA and accordingly no addition has been made in those cases. We have further gone through the order passed by the Ld. CIT(A) in the case of D. Srinivasa Raju placed at page nos. 74 to 88 of the paper book and on perusal of the same we find that the Ld. CIT(A) has deleted the addition made by the Ld. AO on account of the very sam....

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....see is allowed. Order pronounced in the Open Court on 18th March, 2026. ============= Document 1 Original or Jeedimetla Residential Homes PVE Z 67025 P.300/15 WILLCOUNTY PROPERTIES . TO JUL D2 2015 143295 BACHUPALLY. MIYAPUR, HYDERABAD - 500 090. LICENSE No. 21/2008 15:46 CS5749 Rs0000100 PB6665 9 Authorisedalignaten 5930/2015 NONJUDICIAL ANDHRA PRAB STAMP DUTY DEVELOPMENT AGREEMENT-CUM-IRREVOCABLE GENERAL POWER Of ATTORNEY A Seinives abge This Development Agreement-Cum-Irrevocable General Power of Attorney (hereinafter referred to as the "Agreement") is made and executed on this the lon day of July 2015("Agreement Date") at Telangana by and between: NIC 1. MR. A. SRINIVAS RAJU, S/o Mr. A. BhaskaraRaju, aged about 45 years, presently residing at Plot No. 61, survey number 26 and 27, Satyam Enclave East, Petbashirabad, Secunderabad 5000 55(hereinafter referred to as, "Land Owner 1", which expression shall, wherever the context so requires or admits, mean and include his heirs, successors, executors, administrators and assigns) of the FIRSTC PART; B. Sumisa Pro AND For HILL COUNTY PROPERTIES LIMITED Ao....