TaxTMI 
TaxTMI 
2026 (7) TMI 871
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..... 2. Natural justice violated On the facts and circumstances of the case and in law, the NFAC failed to grant sufficient opportunity to present the case and thus principles of natural justice are grossly violated. 3. Long term capital gain of Rs. 47,67,310/- a) The NFAC erred in confirming the addition of Rs. 47,67,310/- as long term capital gain arising out of the sale of immovable property situated at Bhiwandi, without appreciating the facts and circumstances of the case. b) The NFAC failed to appreciate the fact that the gains arising out of said transfer of immovable property situated at Bhiwandi, was forming part of slump sale and already offered to tax in AY 2013-14. c) Without prejudice to above, the NFAC should have considered the stamp duty value as applicable in AY 2013-14 instead of the valuation as on the date of registration. 4. Interest u/s. 234A, 234B and 234C On merits, the Appellant denies its liability for the levy of interest u/s. 234A, 234B and 234C, hence the interest levied may be directed to be deleted. 5. Additional ground - Reopening is bad in law a) The NFAC failed to....
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....ee had not offered the capital gain tax in impugned assessment year. But the Ld. AO rejected the assessee's plea and calculated long term capital gain amount to Rs. 58,20,500/- which was added back with the total income of the assessee. The aggrieved assessee filed an appeal before the Ld. CIT(A). The Ld. CIT(A) uphold the impugned assessment order but the direction was made for allowing the benefit of cost of acquisition during computing of the capital gain tax. The aggrieved assessee filed an appeal before us. 4. The Ld. AR argued and filed a paper book comprising pages 1 to 366 which has been placed on record. The Ld. AR contended that the assessee had sold the non-agricultural land at Bhiwandi to the New Crescent as a going concern by way of slump sale. On the year A.Y. 2013-14 the assessee offered the tax as long term capital gain and filed the return accordingly. The copy of the computation is annexed in APB page 44 to 45. In support of the argument the Ld. AR filed a written note which is reproduced as below: "B. Brief Facts: 3. The Appellant i.e. M/s. Crescent Steel (Old) bearing PAN No. AAAFC2964P having five partners namely; a. PravinBhavanji....
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....ived pg. 43 c. Computation of total income for AY 2013-14 pg. 44-45 d. Income tax return for AY 2013-14 pg. 46-71 e. Audited P & L account and balance sheet for AY 2013-14 pg. 72-73. 6. The New partnership firm i.e. M/s. Crescent Steel (New) bearing PAN No. AAHFC9988J had reflected the asset at the revalued number in its balance sheet also. Kindly refer Factual Paper book a. Income tax return for AY 2013-14 of NEW Crescent Steels pg. 157-182 b. Audited P & L account and balance sheet for AY 2013-14 of New Crescent Steels pg. 183-219 7. Since there was no business left in the Appellant i.e. old firm Crescent Steels, the bank accounts were also closed. Kindly refer Factual Paper book a. DCB bank account-closure of account pg. 116-125 b. Union Bank of India - closure of account pg. 126 c. HDFC bank-closure of account pg. 127-140 8. The Appellant had transferred its business undertaking by way of slump sale as a going concern on 14 July 2012 i.e. during the Assessment year 2013-14. Due to no mandatory requirements of registration of slump sale agreement, the said agreement of slump sale including LAN....
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....g, your Honours had sought certain details which are attached with additional compilation in continuation of the paper book. Kindly refer Factual Paper book a. Form 3CB for AY 2013-14 for Crescent Steels (OLD) pg. 367 b. Form 3CD for AY 2013-14 for Crescent Steels (OLD) pg. 368-373 c. Intimation u/s. 143(1)(a) for AY 2013-14 for Crescent Steels (OLD) pg. 374-382 C. Propositions: Ground No. 3-CIT(A) erred in confirming Long term capital gain of Rs. 47,67,310/-in AY 2016- 2017 arising out of sale of immovable property situated at Bhiwandi Proposition 1: The transfer of the impugned asset was completed in FY 2012-13 and cannot be taxed again in AY 2016-17 16. It is clearly borne out from record, that the Appellant transferred its business undertaking as a going concern on 14 July 2012 for a consideration of Rs. 4,15,00,000/, which included the impugned land at Bhiwandi. Possession of the said land was also handed over on the same date. The subsequent registered document dated 20 October 2015 was executed only to complete procedural requirements due to non-registration of the earlier agreement. 17. It can be seen from the b....
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....erred in its favour. In support of this contention, the Ld. DR respectfully relied upon the judgment of the Hon'ble Supreme Court in the case of Ramesh Chand (D) through LRs v. Suresh Chand & Another, decided on 01.09.2025. The relevant observations of the Hon'ble Supreme Court contained in paragraph 14 of the judgment are reproduced below: "14. Perusal of above said provisions lays down a specific mode of execution of sale deed with respect to immovable property for concluding the sale of a property. In sale for an immovable property the value of which exceeds Rs. 100/-, the three requirements of law are that the transfer of property of sale must take place through a validly executed sale deed, i.e., it must be in writing, properly attested and registered. Unless the sale deed is in writing, attested and registered, the transaction cannot be construed as sale, or in other words, the property will not be transferred." 7. The Ld. DR argued that in impugned assessment year the assessee is liable to pay capital gain tax as the deed of sales is executed in this year. He stands in favor of the orders of revenue authorities. The Ld. DR invited our attention in impugned appell....
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....each having a separate. PAN. The Gujarat High Court in CIT v. Shree Nirmal Commercial Ltd. (1992) 193 ITR 694 has held that assets purchased in partners' names cannot automatically be treated as assets of the firm unless duly transferred. In the instant case, there is no contemporaneous evidence that the impugned land was accounted for in the books of the "New" firm in 2012-13, nor that the partners acted only as nominees. The rectification deed of 2024, being a self-serving document executed after the assessment proceedings had commenced. cannot retrospectively change the character of the 2015 registered deed. 5.1.3. Section 2(47) includes in "transfer" any transaction allowing possession to be taken in part-performance of a contract of the nature referred to in section 53A of the Transfer of Property Act. However, after the Registration and Other Related Laws (Amendment) Act, 2001, an agreement not registered cannot constitute part-performance under section 53A. This was reiterated in Balbir Singh Maini (supra). Therefore, the appellant's reliance on mere possession in 2012 cannot override the registered deed of 2015. In contrast, the AO's action of taxing th....
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....t", a partnership firm consisting of three partners, who were also partners in the assessee firm. The assessee duly executed a slump sale agreement dated 14.07.2012. On perusal of the said agreement, we find that the land situated at Bhiwandi was specifically included in the list of assets annexed thereto, as evidenced from APB Page No. 21. Due to certain technical reasons, the assessee could not execute and register the conveyance deed in A.Y. 2013-14. However, the assessee disclosed the slump sale transaction in its return of income for A.Y. 2013-14, computed the resultant long-term capital gain, and duly paid the taxes thereon. Subsequently, the property was transferred through a registered conveyance deed on 20.10.2015, falling in the impugned assessment year. The stamp duty valuation of the property at Rs. 58,20,500/-, whereas the value assigned to the said land in the slump sale agreement was only Rs. 12,26,050/-. The Ld. AO computed the long-term capital gain by adopting the entire sale consideration as stamp duty value of Rs. 58,20,500/- and confirmed the addition without allowing any deduction towards the cost of acquisition. The Ld. DR contended that a transfer of immovab....