HIREN P. DESAI, MUMBAI V. ITO 22(1)(2), NAVI MUMBAI

ITA 197/MUM/2014

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1826 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Next Hearing Date: 03-11-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 08-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: N B GAN DHI
• Keywords: Capital asset; Share purchase agreement
• Section: 143(3); 54

Judgement Text

H IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUM BAI BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER ./ I.T.A. NO. 197 /MUM/2014 ( / ASSESSMENT YEAR : 2009-10) HIREN P. DESAI B-403, PRESIDENT TOWER LBS MARG GHATKOPAR (W) MUMBAI 400086 V. ITO 22 (1) 2 VASHI, NAVI MUMBAI PAN/GIR NO. AHYPD6693D ( APPELLANT ) : ( RESPONDENT ) APPELLANT BY : SHRI N.B. GANDHI, AR RESPONDENT BY : SHRI NITIN WAGHMODE, DR DATE OF HEARING : 03.11.2015 DATE OF PRONOUNCEMENT : 16.12.2015 O R D E R PER RAMIT KOCHAR, ACCOUNTANT MEMBER, THIS IS AN APPEAL BY THE ASSESSEE DIRECTED AGAINST THE ORDERS BY THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS)- 33, MUMBAI ( CIT(A) FOR SHORT) DATED 18.11.2013 , THE ASSESSEES APPEAL CONTESTING ITS A SSESSMENT U/S143(3) OF THE INCOME TAX ACT, 1961 (THE ACT HEREINAFTER) FOR THE ASSES SMENT YEAR 2009-10. 2. THE ASSESSEE HAS FILED MODIFIED GROUNDS OF APPEA L AS UNDER: 2 I.T.A. NO.197/MUM/2014 (ASSESSMENT YEAR:2009-10) 1.ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LEARNED AO ERRED IN BRINGING TO TAX RS.13,30,000 AS SHORT TERM CAPITAL GAINS ON THE GROUND THAT TRANSACTION OF THE PURCHASE AND SAL E OF FLAT ARE GOVERNED BY SECTION 53A OF TRANSFER OF PROPERTY ACT, 1882, D ESPITE OF THIS FACT THAT THERE WAS NO TRANSFER OF ANY PROPERTY IN THE PREV IOUS YEAR RELEVANT TO THE ASSESSMENT YEAR IN APPEAL. RELIEF CLAIMED: ADDITION OF RS. 13,30,000/- BEING S HORT TERM CAPITAL GAIN WITHOUT TRANSFER OF ANY CAPITAL ASSET DURING T HE YEAR UNDER APPEAL, MAY PLEASE BE DELETED. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS ENGAGED IN THE BUSINESS OF MANUFACTURE AND TRADING OF PACKAGING MATERIAL IN TH E NAME AND STYLE OF M/S H P INDUSTRIES. DURING THE COURSE OF ASSESSMENT PROCEED INGS U/S 143(3) READ WITH SECTION 143(2) OF THE ACT, THE LEARNED ASSESSING OFFICER ( HEREINAFTER CALLED THE AO) ON THE BASIS OF AIR INFORMATION, OBSERVED THAT THE ASSESSE E HAS UNDERTAKEN TWO PROPERTY TRANSACTIONS FOR CONSIDERATIONS OF RS.35,00,000/- A ND RS.55,80,000/- WHILE IN THE AIR SCHEDULE IN RETURN OF INCOME FILED WITH THE REVENUE , IT WAS FILLED AS NOT APPLICABLE BY THE ASSESSEE . THE AO ASKED THE ASSESSEE TO SUB MIT THE DETAILS OF ABOVE TRANSACTIONS AS THE CAPITAL GAIN WAS NOT SHOWN IN T HE RETURN OF INCOME FILED WITH THE REVENUE. THE ASSESSEE SUBMITTED THAT IT SOLD ONE OL D PROPERTY FOR RS.35,00,000/- AND PURCHASED A NEW PROPERTY FOR RS.55,80,000/- , CAPIT AL GAIN EARNED THERE-FROM WAS LONG TERM CAPITAL GAIN AND WAS RE-INVESTED IN THE NEW HO USE PROPERTY AND HENCE WAS EXEMPT FROM TAX AND WAS NOT SHOWN IN THE RETURN OF INCOME FILED WITH THE REVENUE DUE TO OVER-SIGHT . THE ASSESSEE FILED CLAIM OF EXE MPTION OF LONG TERM CAPITAL GAINS OF RS.12,78,116/-(50%) THROUGH LETTER DATED 20/12/2011 FILED BEFORE THE AO DURING ASSESSMENT PROCEEDINGS. THE DISPUTE IN THIS APPEAL IS WITH REGARD TO THE DETERMINATION OF THE DATE OF SALE OF PROPERTY A-7,AMRUT NAGAR, G HATKOPAR WEST , MUMBAI , WHICH WAS JOINTLY OWNED BY THE ASSESSEE ALONG WITH HIS WI FE AND WHICH WAS SOLD VIDE 3 I.T.A. NO.197/MUM/2014 (ASSESSMENT YEAR:2009-10) AGREEMENT FOR SALE DATED 31.12.2008 FOR RS.35,00,00 0/- FOR WHICH PAYMENTS WERE RECEIVED FROM 05.12.2008 TO 20.04.2009 AND THE SALE AGREEMENT HAS THE FOLLOWING TERMS AND CONDITIONS:- IN PURSUANCE OF THE SAID AGREEMENT AS HEREINABOVE STATED THE TRANSFEREES SHALL PAY TO THE TRANSFERORS THE TOTAL AMOUNT OF CONSIDERATION AS AGREED UPON RS.35,00,000/- (RUPEES THIRTY FIVE LACS ONLY) AS F OLLOWS: A) RS.7,00,000/-(RUPEES SEVEN LACS ONLY) ALREADY PAID BY THE SAID TRANSFEREES TO THE SAID TRANSFERORS BEING EARNEST MONEY CUM PART PAYMENT OUT OF TOTAL CONSIDERATION AGREED HEREINABOVE AND THE TRANSFERORS DOTH HERBY ACKNOWLEDGE THE RECEIPT OF PAYMENT. B) RS.28,00,000/-(RUPEES TWENTY EIGHT LACS ONLY) SHALL BE PAYABLE BY THE TRANSFEREES TO THE TRANSFERORS ON OR BEFORE 10.02. 2009 BEING THE FULL AND FINAL PAYMENT AS AGREED HEREINABOVE AND THE TRANSFERORS SHALL HAND OVER VACANT AND PEACEFUL POSSESSION OF THE SAID FLAT ALONG WIT H ALL ORIGINAL DOCUMENTS PERTAINING TO THE SAID FLAT. C. IF THE SAID TRANSFEREES FAILS TO PAY THE BALANC E CONSIDERATION WITHIN THE TIME LIMIT AGREED HEREINABOVE IN CLAUSE NO 1(B) TH E TRANSFERORS HAVE THE RIGHT TO CHARGE INTEREST @ 18 % P.A. FOR SUCH DEFAULT PERIOD, HOWEVER IF THE SAID TRANSFEREES FAILED TO PAY THE BALANCE CONSIDERATIO N WITH THE INTEREST HEREBY AGREED ON OR BEFORE 10.03.2009 THE SAID AGREEMENT FOR SALE STAND CANCEL AND THE EARNEST MONEY PAID BY THE SAID TRANSFEREES TO THE SAID TRANSFERORS AS AGREED IN CLAUSE NO 1(A) HEREINABOVE SHALL BE REFU NDED BY THE SAID TRANSFERORS WITHOUT CARRYING ANY INTEREST ON EXECUTION AND REG ISTRATION OF CANCELLATION. 4. THE AO SHOW-CAUSED THE ASSESSEE AS TO WHY DATE O F SALE SHOULD NOT BE TAKEN AS 31.12.2008 AND THE ASSESSEE SUBMITTED THAT THE ASSE SSEE WAS HAVING THE POSSESSION OF THE FLAT TILL THE MARCH 2009 AND THAT IS WHY THE AS SET IS LONG TERM CAPITAL ASSET . THE AO HELD THAT THE PROPERTY WAS PURCHASED ON 03.03.20 06 VIDE AGREEMENT OF PURCHASE PRODUCED BY THE ASSESSEE AND THE PROPERTY WAS SOLD VIDE AGREEMENT OF SALE OF THE PROPERTY DATED 31.12.2008 AND HENCE, THE GAIN ARIS ING THERE-FROM THE SALE OF PROPERTY IS SHORT TERM CAPITAL GAINS. THE AO ALSO HELD THAT THESE ARE THE DOCUMENTS THROUGH WHICH INTEREST OF THE ASSESSEE IN THE PROPERTY WAS CREATED AS WELL AS TRANSFERRED AND SECTION 53A OF TRANSFER OF PROPERTY ACT,1882 GOVERN ED THE SAME . THE AO TOOK DATE OF PURCHASE OF THE FLAT AS 03-03-2006 AND DATE OF S ALE AS 31-12-2008 , WHEN THE 4 I.T.A. NO.197/MUM/2014 (ASSESSMENT YEAR:2009-10) PROPERTY WAS SOLD ALTHOUGH THE PAYMENTS HAVE BEEN R ECEIVED TILL 20.04.2009 BY THE ASSESSEE. THUS, THE GAINS ARISING FROM SALE OF FLAT WAS CONSIDERED AS SHORT TERM CAPITAL GAIN AND WAS BROUGHT TO TAX ACCORDINGLY BY THE AO V IDE ASSESSMENT ORDERS DATED 23/12/2012 PASSED U/S 143(3) OF THE ACT. 5. AGGRIEVED BY THE ASSESSMENT ORDERS OF THE AO, TH E ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). THE ASSESSEE SUBMITTED BEFORE TH E CIT(A) THAT THE POSSESSION OF THE FLAT WAS HANDED OVER TO BUYER ON 30.04.2009 ON RECEIPT OF ENTIRE CONSIDERATION OF RS.35,00,000/-, THE CAPITAL GAIN AROSE IS LONG TERM CAPITAL GAIN AND IS TAXABLE IN THE ASSESSMENT YEAR 2010-11. THE CIT(A) HELD THAT PROP ERTY WAS SOLD ON 31.12.2008 WHEN THE AGREEMENT OF SALE WAS EXECUTED WHILE PART- CONSIDERATION HAS BEEN RECEIVED TO THE EXTENT OF RS.7,00,000/- ON 05-12-2008 BEING EARNEST MONEY CUM PART PAYMENT AND FURTHER CONSIDERATION OF RS.14,50,000/- WAS REC EIVED BY THE END OF THE FINANCIAL YEAR OUT OF TOTAL CONSIDERATION OF RS.35,00,000/- AND THE BALANCE CONSIDERATION WAS RECEIVED ON 20.04.2009 .THE CIT(A) HELD THAT THE TI TLE TO THE PROPERTY STANDS TRANSFERRED ON 31.12.2008. 5. THE CIT(A) RELIED UPON THE DECISION OF CHATURBHU J DWARAKADAS KAPADIA V. CIT REPORTED IN 260 ITR 491 AND REJECTED THE CONTEN TIONS OF THE ASSESSEE AND HELD THE GAIN ON SALE OF PROPERTY TO BE SHORT TERM CAPITAL G AIN AND HENCE BY TAKING THE DATE OF SALE AS 31.12.2008 , THE GAINS ARISING FROM SALE TH EREOF WAS TREATED AS THE SHORT TERM CAPITAL GAINS AND CLAIM OF EXEMPTION U/S 54 OF THE ACT WAS ALSO DENIED AS THE GAINS ARISING FROM SALE OF THE FLAT WAS TREATED AS SHORT TERM CAPITAL GAINS. 6. AGGRIEVED BY THE ORDERS OF THE CIT(A), THE ASSES SEE HAS FILED SECOND APPEAL BEFORE THE TRIBUNAL . THE LD. COUNSEL OF THE ASSES SEE SUBMITTED THAT THE ASSESSEE HAS PURCHASED THE PROPERTY BEING FLAT NO. A-7,AMRUT NAG AR, GHATKOPAR WEST, MUMBAI- 5 I.T.A. NO.197/MUM/2014 (ASSESSMENT YEAR:2009-10) 400086 ON 03.03.2006 VIDE AGREEMENT FOR SALE DATED 03.03.2006 WHICH IS PLACED IN THE PAPER BOOK PAGE NO. 1 TO 20.THE ASSESSEE SUBMIT TED THAT THE SAME FLAT WAS SOLD VIDE AGREEMENT DATED 31.12.2008 WHICH IS ALSO PLACE D IN PAPER BOOK PAGE NO. 21 TO 50. THE ASSESSEE SHOWED US THE TERMS AND CONDITIONS OF THE AGREEMENT DATED 31.12.2008 AND SUBMITTED THAT THE ASSESSEE ONLY REC EIVED RS.7,00,000/- AS EARNEST MONEY CUM PART PAYMENT AT THE TIME OF SIGNING OF TH E AGREEMENT AND THE BALANCE PAYMENTS WERE RECEIVED IN INSTALLMENTS AND THE PAYM ENT OF RS.12 LACS WAS RECEIVED IN APRIL 2009 WITH THE LAST INSTALLMENT OF PAYMENT BEI NG RECEIVED ON 20 TH APRIL 2009. THE RELEVANT EXTRACT OF THE AGREEMENT OF SALE DATED 31 ST DECEMBER 2008 SHOWN BY THE ASSESSEE TO US ARE AS UNDER: 1. IN PURSUANCE OF THE SAID AGREEMENT AS HEREIN T RANSFEREES SHALL PAY TO THE TRANSFERORS THE TOTAL AMOUNT OF CONSIDERATION AS AGREED UPON RS.35,00,000/- ( RUPEES THIRTY FIVE LACS ONLY) AS FOLLOWS: A. RS7,00,000/- (RUPEES SEVEN LACS ONLY) ALREADY P AID BY THE SAID TRANSFEREES TO THE SAID TRANSFERORS BEING EARNEST MONEY CUM PA RT PAYMENT OUT OF TOTAL CONSIDERATION AGREED HEREINABOVE AND THE TRANSFERO RS DOTH HEREBY ACKNOWLEDGE THE RECEIPT OF PAYMENT. B. RS.28,00,000/- (RUPEES TWENTY EIGHT LACS ONLY) SHALL BE PAYABLE BY THE TRANSFEREES TO THE TRANSFERORS ON OR BEFORE 10.02. 2009 BEING THE FULL AND FINAL PAYMENT AS AGREED HEREINABOVE AND THE TRANSFERORS SHALL HAND OVER VACANT AND PEACEFUL POSSESSION OF THE SAID FLAT ALONG WIT H ALL ORIGINAL DOCUMENTS PERTAINING TO THE SAID FLAT. C. IF THE SAID TRANSFEREES FAIL TO PAY THE BALANCE CONSIDERATION WITHIN THE TIME LIMIT AGREED HEREINABOVE IN CLAUSE NO.1 (B) THE T RANSFERORS HAVE RIGHT TO CHARGE INTEREST 18% P.A. FOR SUCH DEFAULT PERIOD, HOWEVER IF THE SAID TRANSFEREES FAILED TO PAY THE BALANCE CONSIDERATIO N WITH THE INTEREST HEREBY AGREED ON OR BEFORE 10.03.2009 THE SAID AGREEMENT FOR SALE STAND CANCEL AND THE EARNEST MONEY PAID BY THE SAID TRANSFEREE TO T HE SAID TRANSFEROR AS AGREED IN CLAUSE NO. 1(A) HEREINABOVE SHALL BE REFUNDED B Y THE TRANSFERORS WITHOUT CARRYING ANY INTEREST ON EXECUTION AND REGISTRATIO N OF CANCELLATION OF DEED. 6 I.T.A. NO.197/MUM/2014 (ASSESSMENT YEAR:2009-10) 2. ON RECEIVING FULL AND FINAL PAYMENT BY THE SAI D TRANSFEREES TO THE TRANSFERORS AS AGREED IN CLAUSE 1 OF THIS AGREEMEN T THE TRANSFERORS SHALL ; (I) EXECUTE ALL THE TRANSFER FORMS WHICH ARE REQUIR ED AS PER THE BYE-LAWS OF THE SAID SOCIETY AND ANY OTHER DEEDS AND DOCUMENTS WHI CH ARE REQUIRED FOR TRANSFER OF THE RIGHTS, TITLE INTEREST AND CLAIMS OF THE SAID TRANSFERORS SAID FLAT NO. A-7 AND THE SAID FIVE SHARES OF THE SAID SOCIE TY. (II) DELIVER ALL THE ORIGINAL DOCUMENTS PERTAINING TO THE SAID FLAT ALONG WITH THE ORIGINAL SHARE CERTIFICATE NO.46 TO THE SAID T RANSFEREES. 3. ON RECEIVING THE FULL AND FINAL CONSIDERATION A S AGREED HEREINABOVE THE TRANSFERORS SHALL REQUEST THE SAID SOCIETY TO TRAN SFER TO THE TRANSFEREES THE SAID FLAT AND THE SHARE CERTIFICATE ALONG WITH THE DEPO SIT OF SINKING FUND, WATER CHARGES, ELECTRICITY, THE SHARE MONEY AND ANY OTHE R DEPOSIT STANDING TO THE CREDIT OF THE TRANSFERORS IN THE BOOKS OF THE SAID SOCIETY. 7. THUS THE ASSESSEE CONTENDED THAT THE EARNEST MON EY CUM PART CONSIDERATION OF ONLY RS.7,00,000/- WAS RECEIVED AT THE TIME OF SIGN ING OF THE AGREEMENT OF SALE WHILE AS PER THE SALE AGREEMENT DATED 31.12.2008 , THE T RANSFER OF PROPERTY SHALL TAKE PLACE ONLY WHEN THE BUYER HAS MADE FULL PAYMENT OF RS.35, 00,000/- , WHICH WAS COMPLETED ONLY ON 20.04.2009 VIDE RECEIPT DATED 20.04.2009 WH ICH IS PLACED AT PAGE NO. 49 OF THE PAPER BOOK AND THE ASSESSEE SUBMITTED THAT TRAN SFER OF POSSESSION OF THE FLAT TOOK PLACE ONLY ON 30.04.2009 VIDE LETTER DATED 18.04.20 09 WHICH IS PLACED AT PAGE NO. 51 OF THE PAPER BOOK. THE ASSESSSEE SUBMITTED THAT THE BUYER MADE THE PAYMENTS IN INSTALLMENTS AND RS.12 LACS WAS RECEIVED IN APRIL 2 009 WITH THE LAST PAYMENT BEEN RECEIVED ON 20-04-2009. THE ASSESSEE SUBMITTED THAT THE ASSESSEE HAS NEVER GIVEN THE POSSESSION OF THE PROPERTY BEFORE THE ENTIRE PAYMEN T OF RS.35,00,000/- WAS RECEIVED AND THE POSSESSION WAS HANDED OVER ONLY ON 30.4.200 9 VIDE LETTER DATED 18.4.2009 WHICH IS ALSO PLACED IN PAPER BOOK AT PAGE 51 . THE ASSESSEE ALSO SUBMITTED THAT THE PROPERTY WAS TRANSFERRED TO THE BUYER ONLY AFTER TH E FULL PAYMENT WAS RECEIVED. THE ASSESSEE ALSO SUBMITTED THAT AS PER THE AGREEMENT F OR SALE DATED 31.12.2008, THE BUYER 7 I.T.A. NO.197/MUM/2014 (ASSESSMENT YEAR:2009-10) HAS TO MAKE FULL PAYMENT BEFORE ANY TITLE IN THE PR OPERTY CAN BE TRANSFERRED TO THE BUYER AND AS PER AGREEMENT OF SALE DATED 31.12.2008 , IN CASE OF FAILURE OF THE BUYER TO PAY THE ENTIRE CONSIDERATION BY 10.03.2009 , THE AG REEMENT FOR SALE WILL STAND CANCELLED AND EARNEST MONEY PAID BY THE BUYER SHALL BE REFUNDED WITHOUT ANY INTEREST BY THE ASSESSEE AS PER CLAUSE 1 AND 2 OF THE AGREEM ENT DATED 31.12.2008 , PLACED AT PAGE 27 AND 28 OF PAPER BOOK AND THE RELEVANT EXTR ACT IS AT THE PRECEDING PARA ALSO. THUS THE ASSESSEE SUBMITTED THAT THE TRANSFER OF PR OPERTY WAS COMPLETED ONLY IN APRIL 2009 WHEN ALL THE INGREDIENTS OF SALE WERE COMPLETE D AND HENCE THE GAIN ARISING FROM SALE OF THE PROPERTY IS LONG TERM CAPITAL GAIN AS T HE PROPERTY WAS ACQUIRED ON 03-03- 2006. 8. THE LD. DR ON THE OTHER HAND RELIED UPON THE ORD ERS OF THE AUTHORITIES BELOW AND SUBMITTED THAT AGREEMENT FOR SALE WAS EXECUTED ON 3 1.12.2008 AND PART CONSIDERATION WAS ALSO RECEIVED AT THE TIME OF SIGNING OF THE AGR EEMENT FOR SALE AND SECTION 53A OF THE TRANSFER OF PROPERTY ACT,1882 IS APPLICABLE TO THIS CASE AS THE SALE WAS COMPLETED IN DECEMBER 2008 WHEREBY TRANSFER OF PROPERTY TOOK PLACE VIDE AGREEMENT FOR SALE DATED 31.12.2008 WHEREBY IN PART PERFORMANCE , THE ASSESSEE ALSO RECEIVED RS. 7 LACS AS PART CONSIDERATION. . 9.WE HAVE CONSIDERED THE RIVAL CONTENTION AND PERUS ED THE MATERIAL ON RECORD. WE HAVE OBSERVED THAT THE ASSESSEE HAS ENTERED INTO AN THE AGREEMENT FOR SALE DATED 31.12.2008 WHEREBY ONLY EARNEST MONEY WHICH IS A PA RT CONSIDERATION ALSO , AMOUNTING TO RS.7,00,000/- WAS RECEIVED BY THE ASS ESSEE FROM THE BUYER AS AGAINST THE TOTAL CONSIDERATION OF RS.35,00,000/- FOR THE S ALE OF THE FLAT AND THE ASSESSEE WAS TO TRANSFER THE FLAT AND TO HANDOVER THE POSSESSION AFTER THE ENTIRE CONSIDERATION OF RS.35,00,000/- IS PAID ON OR BEFORE 10-03-2009 WITH INTEREST BY THE BUYER AS PER CLAUSE 1(B) AND(C) OF THE AGREEMENT , THE ASSESSEE HAS RECEIVED THE ENTIRE PAYMENT OF 8 I.T.A. NO.197/MUM/2014 (ASSESSMENT YEAR:2009-10) RS.35,00,000/- IN INSTALLMENTS AND THE PAYMENT OF R S.12 LACS WAS RECEIVED IN THE MONTH OF APRIL 2009 WITH THE LAST PAYMENT BEING RE CEIVED ON 20.04.2009 AND THE POSSESSION OF THE SAID FLAT WAS HANDED OVER BY THE ASSESSEE TO THE BUYER ON 30.04.2009. THUS, KEEPING IN VIEW THE PECULIAR FACT S AND CIRCUMSTANCES OF THE INSTANT CASE , IT COULD NOT BE SAID THAT THE SALES TRANSAC TIONS WAS COMPLETED ON 31.12.2008 ITSELF WHEN THE AGREEMENT FOR SALE WAS ENTERED INTO AND MORE-SO IT ALSO CONTAINED A CLAUSE THAT IF THE BALANCE PAYMENT OF RS.28,00,000/ - IS NOT MADE BY THE BUYER BY 10- 03-2009 WITH INTEREST @18% P.A. FOR DEFAULT AFTER 1 0-02-2009 AS PER CLAUSE 1(B) AND(C) , THE AGREEMENT STAND CANCELLED AND EARNEST MONEY PAID BY THE BUYER SHALL BE REFUNDED BY THE ASSESSEE TO THE BUYER WITHOUT ANY I NTEREST. IN VIEW OF THE ABOVE PECULIAR FACTS AND CIRCUMSTANCES OF THE CASE, WE A RE OF THE CONSIDERED OPINION THAT THE SALE OF THE PROPERTY WAS COMPLETED ONLY ON COMPLETI ON OF THE SALE IN APRIL 2009 WHEN THE SUBSTANTIAL COMPLIANCE OF THE AGREEMENT HAS TAK EN PLACE BY PAYMENT OF THE SUBSTANTIAL BALANCE CONSIDERATION OF RS.12 LACS IN THE MONTH OF APRIL 2009 FOLLOWED BY HANDING OVER OF POSSESSION OF THE FLAT TO THE BU YER ON 30-04-2009. THE ASSESSEE HAS ACQUIRED THE SAID FLAT VIDE AGREEMENT DATED 03.03.2 006 WHICH IS NOT IN DISPUTE IN THIS APPEAL AND HENCE, SINCE THE PROPERTY WAS HELD BY THE ASSESSEE FOR MORE THAN THREE YEARS, THE SAID PROPERTY IS LONG TERM CAPITAL ASSE T AS DEFINED U/S 2(29A) OF THE ACT AND THE GAINS ARISING FROM THE SALE OF THE PROPERTY SHALL BE CHARGEABLE TO TAX AS LONG TERM CAPITAL GAINS. WE , THEREFORE, HOLD THAT THE G AIN ARISING FROM THE SALE OF THE AFORESAID PROPERTY IS CHARGEABLE TO TAX AS LONG T ERM CAPITAL GAINS TO BE COMPUTED IN ACCORDANCE WITH THE PROVISIONS OF THE ACT.WE ORDER ACCORDINGLY. IN THE RESULT, THE ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON DECEMBER 16 TH , 2015 SD/- SD/- (AMIT SHUKLA) (RAMIT KOCHAR) JUDICIAL MEMBER ACCOUNTANT MEMBER 9 I.T.A. NO.197/MUM/2014 (ASSESSMENT YEAR:2009-10) MUMBAI; DATED : 16.11.2015 PS:- POOJA K. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT - CONCERNED 5. DR, ITAT, MUMBAI 6. GUARD FILE BY ORDER, (DY./ASSTT. REGISTRAR) ITAT, MUMBAI