2026 (7) TMI 1587

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....Act, 1961 (hereinafter referred to as 'the Act' in short) for Assessment Year 2014-15. 2. The Revenue has raised following grounds of appeal:- "(1) "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) was justified in deleting addition made by the AO on account of capital gain amounting to Rs. 2,96,29,264/-, without appreciating the facts of the case?" (2) Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) was justified in not appreciating the fact that assignment of development right over the land by the assessee along with the other co-owners to Developer with authority, rights and possession as mentioned in JDA dated 12.06.2013 has given rise to '....

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....t deleted the addition on merits after holding that the ownership of the land continued to remain with the assessee and the developer was merely granted development rights for construction. 5. Aggrieved by the order of the Ld. CIT(A), the Revenue is now in appeal before the Tribunal. 6. Before us, the Ld. DR supported the assessment order and submitted that execution of the Joint Development Agreement, handing over of possession and execution of irrevocable General Power of Attorney clearly constituted transfer under section 2(47)(v) of the Act. It was argued that substantial rights in the property stood transferred in favour of the developer and, therefore, the Assessing Officer rightly brought the capital gains to tax in Assessment ....

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....r the purpose of development and construction. Clause 3.1 specifically provides that the status of the owners shall remain as owners. Clause 3.4 further states that the developer would hold possession only as a representative of the owners. Thus, the possession given to the developer was only for carrying out the development work and not as possession in part performance of a contract of sale. 8.2 The Hon'ble Supreme Court in the case of CIT v. Balbir Singh Maini (398 ITR 531) and Seshasayee Steels (P.) Ltd. v. ACIT (421 ITR 46) has held that where the developer is given possession only for the purpose of development, such possession does not amount to possession under section 53A of the Transfer of Property Act. Consequently, sectio....