The ITO, Ward-5(4), Surat V. Shri Yasin Moosa Godil, Surat

ITA 2519/AHD/2009

• Counselvise Citation: 251920514 RSA 2009
• Duration Of Justice: 2 year(s) 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-04-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 27-03-2012
• Assessment Year: 2006-2007
• Appeal Filed On: 31-08-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SAMIR TEKRIWAL
• Assessee Lawyers: MANISH J SHAH
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Income from undisclosed sources
• Section: 143(3); 50C

Judgement Text

ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 1 IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD (BEFORE SHRI G.C.GUPTA VICE PRESIDENT & SHRI ANIL C HATURVEDI, A.M.) I.T.A. NO. 2519 /AHD/2009. (ASSESSMENT YEAR: 2006- 07) INCOME TAX OFFICER, WARD 5(4), ROOM NO.316, AAYAKAR BHAVAN, MAJURA GATE, SURAT. (APPELLANT) VS. SHRI YASIN MOOSA GODIL, 4/3198 ZOANB COMPLEX, VANSFODAPULL, SALABATPURA, SURAT. (RESPONDENT) PAN: ABHPG 3746 R APPELLANT BY : SHRI SAMIR TEKRIWAL, SR. D.R. RESPONDENT BY : SHRI MANISH J. SHAH. ( )/ ORDER DATE OF HEARING : 27-3-2012 DATE OF PRONOUNCEMENT : 13/4/2012 PER: SHRI ANIL CHATURVEDI,A.M. THIS APPEAL IS FILED BY THE REVENUE AGAINST THE OR DER OF LD. CIT (A) III, SURAT DATED 30-6-2009 FOR THE ASSESSMENT Y EAR 2006-07. 2. THE ONLY EFFECTIVE GROUND RAISED BY THE REVENUE IS AS UNDER:- ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 2 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (A)-III, SURAT HAS ERRED IN DELETING TH E ADDITION OF RS.41,45,255/- HOLDING THAT THE A.O. HAS NOT MENTIO NED SECTION 50C OF THE I.T. ACT. 3. THE FACTS OF THE CASE ARE THAT THE APPELLANT IS AN INDIVIDUAL. THE APPELLANT FILED HIS RETURN OF INCOME ON 8.1.2007 DE CLARING TOTAL INCOME OF RS 80,050/-. THE CASE WAS SELECTED FOR SCRUTINY AND THE ASSESSMENT WAS COMPLETED U/S 143(3) ON 30.12.2008 BY DETERMINI NG THE TOTAL INCOME AT RS 42,25,305/-. DURING THE COURSE OF ASSE SSMENT PROCEEDINGS THE ASSESSING OFFICER (A.O) NOTICED THA T ON 25-6-2004 I.E. IN THE A.Y. 2005-06, THE APPELLANT HAD BOOKED A FLA T NO.701 WITH M/S. PATEL BROTHERS CONSTRUCTION CORPORATION, PATEL APAR TMENT, BYCULLA MUMBAI, WHICH WAS UNDER-CONSTRUCTION. THE TOTAL AGR EED PURCHASE PRICE WAS RS.15,99,000/- OUT OF WHICH RS.50,000/- W AS PAYABLE AT THE TIME OF BOOKING AND THE BALANCE AMOUNT WAS PAYABLE IN INSTALLMENTS IN SUCH A MANNER THAT THE ENTIRE AMOUNT WAS PAID BE FORE TAKING POSSESSION OF THE FLAT. IN ADDITION TO THE PURCHASE CONSIDERATION, THE APPELLANT HAD TO PAY RS.13,000/- FOR LEGAL CHARGES, TAXES, ELECTRIC WATER DEPOSIT, FORMATION OF SOCIETY CHARGES ETC. OU T OF THE AGREED AGGREGATE CONSIDERATION OF RS.16,12,000/- THE APPEL LANT HAD PAID AN AMOUNT OF RS.50,000/- AT THE TIME OF BOOKING ON 25- 6-2004 BY CASH AND THE BALANCE AMOUNT WAS PAID BY THE APPELLANT IN VAR IOUS INSTALLMENTS FROM TIME TO TIME. AN AMOUNT OF RS.1,00,000/- WAS KEPT OUTSTANDING BY THE APPELLANT SINCE THE BUILDER I.E. M/S. PATEL CONSTRUCTION CORPORATION HAD FAILED TO GIVE THE POSSESSION OF TH E FLAT IN TIME TO THE ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 3 APPELLANT AND ALSO FAILED TO ALLOT THE PROMISED PAR KING PLACE. AS THE ENTIRE AMOUNT WAS NOT PAID BY THE APPELLANT, THE BU ILDER HAD NEITHER HANDED OVER THE POSSESSION OF THE FLAT TO THE APPEL LANT NOR HAD EXECUTED ANY REGISTERED SALE DEED IN FAVOUR OF THE APPELLANT. IN THE CURRENT YEAR IN THE MONTH OF MAY, 2005 THE APPELLAN T REQUESTED THE BUILDER TO CANCEL THE BOOKING OF THE FLAT AND RETUR N THE BOOKING AMOUNT AS PAID BY HIM TOWARDS THE SAID FLAT. IN RE SPONSE TO THE REQUEST OF THE APPELLANT TO CANCEL THE BOOKING AND RETURN THE BOOKING AMOUNT, THE BUILDER INFORMED THAT THE BOOKING WILL BE CANCELLED AND THE AMOUNT THEREOF WILL BE RETURNED BACK, ONLY AFTE R ANOTHER BUYER IS LOCATED FOR THE SAID FLAT AND PAYMENT IS RECEIVED F OR IT. 4. ON 28-2-2006 I.E. IN THE YEAR UNDER CONSIDERATI ON, THE APPELLANT, THE BUILDER AND THE NEW BUYER, MR. MEERAJ ABDUL AZI Z BHAGAD, ENTERED INTO A TRIPARTY REGISTERED SALE AGREEMENT FOR TRANS FER OF THE SAID FLAT, WHEREIN THE APPELLANT (ADDRESSED AS THE VENDOR IN T HE SALE AGREEMENT) WAS TO TRANSFER ALL HIS RIGHTS, TITLE AN D INTEREST IN THE SAID FLAT TO THE BUYER VIZ. MR. MEERAJ ABDUL AZIZ BHAGAD ; THE BUILDER M/S. PATEL BROTHERS CONSTRUCTION CORPORATION (ADDRESSED AS THE CONFIRMING PARTY IN THE SALE AGREEMENT) WAS TO GIVE THE POSSESSION OF THE SAID FLAT TO THE BUYER AND WAS ALSO TO ALLOT TH E SAID FLAT TO THE BUYER WHICH WAS ORIGINALLY AGREED TO BE ALLOTTED TO THE APPELLANT AND THE NEW BUYER VIZ. MR. MEERAJ ABDUL AZIZ BHAGAD (AD DRESSED AS THE PURCHASER IN THE SALE AGREEMENT) WAS TO ACQUIRE ONL Y THE RIGHTS IN THE SAID FLAT FROM THE APPELLANT AND THE POSSESSION AND THE ALLOTMENT THEREOF FROM THE BUILDER. ACCORDINGLY, DURING THE Y EAR UNDER ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 4 CONSIDERATION, THE APPELLANT RECEIVED BACK THE BOOK ING AMOUNT PAID BY HIM TO THE BUILDER, FROM THE BUYER. 5. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO OBSERVED THAT THE JT. SUB REGISTARS OFFICE MUMBAI, HAD CONS IDERED THE VALUE OF THE SAID FLAT AT RS. 57,57,255/- FOR REGISTRATION O F FLAT AS AGAINST THE TOTAL VALUE OF RS.16,12,000/- . ACCORDINGLY, ON THE BASIS OF INFORMATION RECEIVED FROM OFFICE OF THE JT. REGISTRAR OFFICE, M UMBAI, THE AO TREATED THE DIFFERENCE AMOUNT OF RS.41,45,255 (I.E. RS.57,57,255 RS.16,12,000/-) AS THE UNEXPLAINED INCOME OF THE AP PELLANT AND MADE ADDITION THEREOF TO THE TOTAL INCOME OF THE APPELLA NT. 6. AGGRIEVED BY THE ORDER OF A.O, THE APPELLANT PRE FERRED APPEAL BEFORE CIT (A). BEFORE CIT(A), APPELLANT CONTENDED THAT AS APPELLANT HAD ONLY PAID BOOKING AMOUNT AND HAD NEITHER TAKEN POSSESSION NOR HAD EXECUTED REGISTERED PURCHASE DOCUMENT IN HIS NA ME, THE FLAT, BEING AN IMMOVABLE PROPERTY NEVER STOOD IN HIS NAME AND THEREFORE PROVISIONS OF SECTION 50C WAS NOT APPLICABLE. APPEL LANT HAD ONLY THE BOOKING RIGHTS IN THE SAID FLAT AND HAS RECOVERED BACK THE BOOKING AMOUNT AS PAID BY HIM AND HENCE PROVISION OF SECTIO N 50C ARE NOT APPLICABLE AND THEREFORE THE A.O HAD ERRED IN CONSI DERING RS 41,45,255 AS UNEXPLAINED INCOME OF THE APPELLANT. 7. CIT (A) DELETED THE ADDITIONS MADE BY A.O. BY OB SERVING AS UNDER:- ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 5 I HAVE CONSIDERED THE FACTS OF THE CASE AND T HE RIVAL POSITIONS. I HAVE GONE THROUGH THE TRI PARTY REGIST ERED SALES DEED EXECUTED BETWEEN THE APPELLANT, THE BUILDER AND THE NEW BUYER AND ON GOING THROUGH THE SAME IT IS SEEN THAT NO RE GISTERED DOCUMENT HAD BEEN EXECUTED BETWEEN THE APPELLANT AN D THE BUILDER IN RESPECT OF PURCHASE OF FLAT NO.701 BUT T HE APPELLANT HAD ONLY BOOKED THE SAID FLAT WITH THE BUILDER. FURTHER, PRIOR TO THE EXECUTION OF THE SUBJECT TRI PARTY REGISTERED SALE DEED IN RESPECT OF FLAT NO.701, THE APPELLANT HAD NOT ACQUIRED THE POSSESSION OF THE SAID FLAT FROM T HE BUILDER AND THE FULL CONSIDERATION AS AGREED AT THE TIME OF BOO KING WAS ALSO NOT PAID. THUS IT IS EVIDENT FROM THE REGISTERED SA LE DEED ITSELF THAT THE APPELLANT HAD NEITHER ENTERED INTO ANY LEG AL DOCUMENT IN HIS NAME AS AN OWNER NOR HAD HE ACQUIRED THE POSSES SION OF THE SAID FLAT FROM THE BUILDER AND THEREFORE, THE APPEL LANT WAS NOT THE LEGAL OWNER OF THE SAID FLAT BEING AN IMMOVABLE PRO PERTY AS PER THE PROVISIONS OF SECTION 2(47) OF THE I. T. ACT. THE TRI PARTY REGISTERED SALE DEED FURTHER MENTIONS THAT THE NEW BUYER SHALL ACQUIRE THE POSSESSION OF THE SAID FLAT FROM THE BUILDER AND NOT FROM THE APPELLANT. THE DEED ALSO C LEARLY STATES THAT THE APPELLANT AGREES TO SELL, TRANSFER AND ASS IGN ONLY HIS RIGHTS, TITLE AND INTEREST IN THE SAID FLAT TO THE BUYER AND THE BUILDER IN TURN AGREES TO ALLOT THE SAID FLAT TO TH E NEW BUYER AND ALSO PUT THE NEW BUYER IN POSSESSION OF THE SAID FL AT. THUS, IT IS EVIDENT FROM THE REGISTERED SALE DEED T HAT IT IS THE BUILDER WHO IS TRANSFERRING THE CAPITAL ASSET I .E. THE FLAT TO THE NEW BUYER, BY HANDING OVER THE POSSESSION OF THE FL AT AS ALSO THE LEGAL OWNERSHIP THEREOF TO THE NEW BUYER AND TH E APPELLANT ONLY RECEIVES BACK THE BOOKING ADVANCE PAID BY HIM TO THE BUILDER, BY RELINQUISHING HIS BOOKING RIGHT IN THE SAID FLAT. THE APPELLANT HAS BEEN ADDRESSED IN THE REGISTERED SALE AGREEMENT AS A VENDOR ONLY TO SELL, TRANSFER AND AS SIGN HIS RIGHT AS A BOOKING MEMBER IN THE SAID FLAT TO THE NEW BUY ER AS IS CLEARLY MENTIONED IN POINT NO.1 ON PAGE 5 OF THE RE GISTERED SALE DEED AND IT IS CLEARLY PROVIDED IN THE REGISTERED S ALES DEED THAT IT IS ACTUALLY THE BUILDER WHO IS TRANSFERRING THE POS SESSION AND ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 6 ALLOTMENT OF THE SAID FLAT TO THE NEW BUYER AND THU S, THE TRANSFEROR VENDOR OF THE CAPITAL ASSET I.E. THE FLA T IS THE BUILDER. HOWEVER, THE ITO ONLY ON THE BASIS OF INFORMATION R ECEIVED FROM OFFICE OF THE JT. REGISTRAR OFFICE, MUMBAI, HA S TREATED THE AMOUNT OF RS.41,45,255 BEING THE DIFFERENCE BETWEEN THE STAMP DUTY VALUATION AND THE VALUE AS PER THE REGISTERED SALE DEED AS THE UNEXPLAINED INCOME OF THE APPELLANT AND MADE AD DITION THEREOF TO THE TOTAL INCOME OF THE APPELLANT, BY ER RONEOUSLY TREATING THE APPELLANT AS THE VENDOR TRANSFERRING A CAPITAL ASSET BEING LAND OR BUILDING OR BOTH. THE ITO HAS NOT MEN TIONED SECTION 50C OF THE ACT WHILE MAKING THE SAID ADDITI ON HOWEVER, IT IS SEEN THAT THE POWERS OF SUBSTITUTING THE STAMP D UTY VALUE FOR THE ACTUAL SALES CONSIDERATION ARE PROVIDED ONLY IN SECTION 50C OF THE I. T. ACT AND THEREFORE, THE IMPUGNED ADDITI ON HAS BEEN CLEARLY MADE ONLY AS PER THE PROVISIONS OF THE SAID SECTION SINCE, THERE IS NO OTHER EVIDENCE ON RECORD OF ANY UNACCOUNTED INCOME BEING RECEIVED BY THE APPELLANT. IT IS FURTHER SEEN THAT THE PROVISIONS OF SECTION 5 0C OF THE I. T. ACT ARE APPLICABLE IN THE CASE OF AN ASSESSEE WH EN HE TRANSFERS A CAPITAL ASSET BEING LAND OR BUILDING OR BOTH, HOWEVER, IN THE PRESENT CASE FROM THE TRI PARTY REGISTERED S ALE DEED IT IS EXPLICIT THAT THE APPELLANT HAS TRANSFERRED ONLY HI S BOOKING RIGHTS IN THE SAID FLAT TO THE BUYER AND HAS NOT TRANSFERR ED THE FLAT I.E. A CAPITAL ASSET LAND OR BUILDING OR BOTH AND THEREFO RE, THE PROVISIONS OF SECTION 50C ARE NOT APPLICABLE IN THE CASE OF THE APPELLANT. ACCORDINGLY, IN VIEW OF THE FACTS OF THE CASE, I HO LD THAT THE PROVISIONS OF SECTION 50C OF THE ACT ARE NOT APPLIC ABLE IN THE CASE OF THE APPELLANT CASE, FIRST OF ALL THE APPELL ANT HAD ONLY GIVEN BOOKING ADVANCE FOR FLAT NO.701 TO THE BUILDE R AND HAD NEITHER ENTERED INTO ANY REGISTERED PURCHASE DEED N OR HAD TAKEN THE POSSESSION OF THE SAID FLAT FROM THE BUILDER AN D THUS WAS NOT THE OWNER OF THE SAID FLAT AND SECONDLY THE APPELLA NT NOT BEING THE OWNER OF THE SAID FLAT CANNOT BE SAID TO HAVE T RANSFERRED THE SAME TO THE NEW BUYER BUT WHAT HAS BEEN TRANSFERRED IS ONLY THE BOOKING RIGHTS AND THEREFORE, I HEREBY DELETE THE A DDITION OF ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 7 RS.41,45,255/- AS MADE BY THE ITO BY ADOPTING THE S TAMP DUTY VALUATION AS PROVIDED IN SECTION 50C OF THE ACT. HO WEVER THE ITO IS DIRECTED TO INFORM THE ASSESSING OFFICER OF THE BUILDER NAMELY PATEL BROS CONSTRUCTION CORPORATION TO EXAMINE THE ISSUE OF ON MONEY RECEIPT IN RESPECT OF THIS SALE. 8. AGGRIEVED BY THE ORDER OF LD. CIT (A), REVENUE N OW IS IN APPEAL BEFORE US. 9. THE LD. D.R. VEHEMENTLY ARGUED AND URGED THAT TH E ORDER OF THE ASSESSING OFFICER NEEDS TO BE UPHELD. ACCORDING TO THE LD. D.R., IN THE BALANCE SHEET FILED BY THE APPELLANT IN EARLIER YEAR, THE APPELLANT HIMSELF HAD SHOWN THE AMOUNT PAID FOR BOOKING THE F LAT AS A FLAT. NOW IN THE YEAR OF SALE, THE APPELLANT HAS CHANGED HIS STAND AND ARGUES THAT WHAT HAS BEEN SOLD IS BOOKING RIGHTS OF THE FLAT AND NOT THE FLAT PER-SE AND THEREFORE, PROVISIONS OF SECT ION 50C ARE NOT APPLICABLE. ACCORDING TO D.R., THE APPELLANT CANNOT CHANGE THE STAND. LD. D.R. POINTED OUT TO THE FACT THAT APPELLANT HAD AGREED TO PURCHASE THE FLAT FOR RS.16 LACS OUT OF WHICH THE APPELLANT HAD ALREADY PAID RS.15 LACS WHICH CONSTITUTE MORE THAN 90% OF THE AG REED CONSIDERATION. IN SUCH A SITUATION IT CAN VERY WELL BE SAID THAT APPELLANT HAD ALREADY PURCHASED FLAT AND THEREFORE, ON ITS TRANSFER IT WAS A CASE OF TRANSFER OF FLAT AND NOT BOOKING RIG HTS AND THEREFORE THE PROVISIONS OF SECTION 50C WOULD BECOME CLEARLY APPLICABLE. HE FURTHER STATED THAT THE WORD TRANSFER AND CAPITA L ASSET HAS NOT BEEN DEFINED IN SECTION 50C AND ACCORDINGLY THE MEA NING OF THESE TERMS SHOULD BE UNDERSTOOD IN THE WAY IN WHICH IT I S DEFINED IN SEC. 2(42) AND SEC.2(47). HE FURTHER STATED THAT SECTION 50C CANNOT BE ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 8 CONSIDERED IN ISOLATION. HE THEREFORE, VEHEMENTLY A RGUED AND CONTENDED THAT THE SALE MADE BY APPELLANT SHOULD BE CONSIDERED AS SALE OF FLAT AND NOT OF BOOKING RIGHT AND ACCORDING LY SEC. 50C WOULD BE APPLICABLE AND THEREFORE THE ORDER OF A.O. SHOUL D BE UPHELD. IN SUPPORT APART FROM VARIOUS CASES, HE RELIED ON THE FOLLOWING DECISIONS:- (1) CIT V. NARANG DAIRY PRODUCTS (1996) 219 ITR 478 (SC) (2) CIT V. MORMASJI MANCHARJI VAID (2001) 250 ITR 5 42 (GUJ) (FB) (4) J.K. KASHYAP V. ACIT (2008) 302 ITR 255 (DEL.) (5) SANJAYBHAI Z PATEL VS ACIT (2011) 48 SOT 231 (A HD) (6) FERDOON IRANI VS ITO (1986) 15 ITD (BOM) 627 10. LD. D.R. THUS VEHEMENTLY ARGUED AND URGED THAT THE ORDER OF CIT (A) SHOULD BE SET ASIDE AND THAT OF A.O. BE UPHELD. 11. LD. A.R. ON THE OTHER HAND URGED THAT SECTION 5 0C IS A DEEMING PROVISION BY VIRTUE OF WHICH A LEGAL FICTION HAS BE EN CREATED. IT IS A SETTLED LAW THAT LEGAL FICTION CANNOT BE EXTENDED B EYOND THE PURPOSE FOR WHICH IT IS ENACTED. LEGAL FICTION IS ONLY FOR A DEFINITE PURPOSE AND THEY ARE LIMITED TO THE PURPOSE FOR WHICH THEY ARE CREATED AND SHOULD NOT BE EXTENDED BEYOND THE LEGITIMATE FIELD. 12. THE LD. A.R. FURTHER STATED THAT WHAT HAS BEEN SOLD BY THE APPELLANT WAS BOOKING RIGHTS AND NOT THE FLAT. HE STATED THAT APPELLANT CANNOT SELL THE FLAT BECAUSE HE NEVER GOT THE POSSESSION OF THE FLAT, HE POINTED TO THE AGREEMENT FOR SALE DATE D 28-2-2006 THAT WAS ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 9 ENTERED INTO BETWEEN APPELLANT, THE PURCHASER AND T HE BUILDER. HE POINTED OUT THE RECITAL CLAUSE OF AGREEMENT WHEREIN IT HAS BEEN STATED THAT APPELLANT OWING TO CERTAIN UNAVOIDABLE CIRCUMS TANCES, COULD NOT MAKE PAYMENT OF BALANCE AMOUNT TO THE BUILDER AND A S SUCH COULD NOT AVAIL THE POSSESSION OF THE FLAT . HE FURTHER STATED THAT PROVISIONS OF SECTION 50C ARE APPLICABLE IN THE CASE OF AN APP ELLANT WHEN HE TRANSFERS A CAPITAL ASSET BEING LAND OR BUILDING OR BOTH. IN THE CASE OF APPELLANT THE TRI-PARTY REGISTERED AGREEMENT IT IS EXPLICIT THAT THE APPELLANT HAS TRANSFERRED ONLY HIS BOOKING RIGHTS IN THE FLAT TO THE BUYER AND HAS NOT TRANSFERRED THE FLAT I.E. A CAPIT AL ASSET BEING LAND OR BUILDING OR BOTH AND THEREFORE, THE PROVISIONS OF S EC.50C ARE NOT APPLICABLE IN THE CASE OF APPELLANT. HE ALSO DREW O UR ATTENTION TO THE FINDING OF CIT (A) WHICH HAS BEEN REPRODUCED HEREIN ABOVE AT PARA 7 TO SUPPORT HIS CLAIM. THE LD. A. R. RELIED ON THE FOLL OWING DECISIONS:- (A) ATUL PURANIK VS ITO (2011) 132 ITD 499.(MUM) (B) DCIT VS TEJINDER SINGH (ITA NO.1459/KOL/2011) O RDER DATED 29.2.2012 (C ) SMT KISHORE SHARAD GAITONDE VS ITO (ITA 1561/M /09) ORDER DATED 27.11.2009 . 13. WE HAVE HEARD THE RIVAL CONTENTIONS PERUSED THE MATERIAL PLACED ON RECORD. IT IS UNDISPUTED FACT THAT TRIPARTITE AG REEMENT FOR SALE HAS BEEN ENTERED ON 28-2-2006 BETWEEN THE APPELLANT, TH E BUILDER AND THE PURCHASER IN RESPECT OF FLAT NO.701. IT IS ALSO AN UNDISPUTED FACT THAT PRIOR TO THE EXECUTION OF THE TRIPARTITE AGREEMENT THE APPELLANT HAD NEITHER PAID FULL CONSIDERATION OF THE FLAT NOR THE APPELLANT HAD ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 10 ACQUIRED THE POSSESSION OF THE FLAT FROM BUILDER. F ROM THE AGREEMENT IT IS EVIDENT THAT IT IS THE BUILDER WHO IS TRANSFE RRING THE CAPITAL ASSET I.E. THE FLAT TO THE NEW BUYER, BY HANDING OVER THE POSSESSION OF THE FLAT AS ALSO THE LEGAL OWNERSHIP THEREOF TO THE NEW BUYER AND THE APPELLANT ONLY RECEIVED BACK THE BOOKING ADVANCE PA ID BY HIM TO THE BUILDER, BY RELINQUISHING HIS BOOKING RIGHT ON THE SAID FLAT. 14. SEC.50C READS AS UNDER:- 50C. SPECIAL PROVISION FOR FULL VALUE OF CONSIDERA TION IN CERTAIN CASES. (1) WHERE THE CONSIDERATION RECEIVED OR ACC RUING AS A RESULT OF THE TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET, BEING LAND OR BUILDING OR BOTH, IS LESS THAN THE VALUE ADOPTED OR ASSESSED BY ANY AUTHORITY OF A STATE GOVERNMENT (HEREINAFTER IN THI S SECTION REFERRED TO AS THE STAMP VALUATION AUTHORITY) FOR THE PURPOSE OF PAYMENT OF STAMP DUTY IN RESPECT OF SUCH TRANSFER, THE VALUE S O ADOPTED OR ASSESSED SHALL, FOR THE PURPOSES OF SECTION 48, BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUIN G AS A RESULT OF SUCH TRANSFER. 15. IN THE CASE OF DCIT VS TEJINDER SINGH (SUPRA) I T HAS BEEN HELD AS UNDER: 8. REVENUES CONTENTION THAT THE PROVISIONS OF SE CTION 50C ALSO APPLY TO THE TRANSFER OF LEASEHOLD RIGHTS IS D EVOID OF LEGALLY SUSTAINABLE MERITS AND IS NOT SUPPORTED BY THE PLAI N WORDS OF THE STATUTE. SECTION 50C CAN COME INTO PLAY ONLY IN A SITUATION WHERE THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF THE ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 11 TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET, BEING L AND OR BUILDING OR BOTH IS LESS THAN THE VALUE ADOPTED OR ASSESSED OR ASSESSABLE BY ANY AUTHORITY OF A STATE GOVERNMENT . FOR THE PURPOSE OF PAYMENT OF STAMP DUTY IN RESPECT OF SUCH TRANSFER. CLEARLY, THEREFORE, IT IS SINE QUA NON FOR APPLICAT ION OF SECTION 50C THAT THE TRANSFER MUST BE OF A CAPITAL SEET, B EING LAND OR BUILDING OR BOTH, BUT THEN LEASEHOLD RIGHT IN SUCH A CAPITAL ASSET CANNOT BE EQUATED WITH THE CAPITAL ASSET PER SE. WE ARE THEREFORE UNABLE TO SEE ANY MERITS IN REVENUES CON TENTION THAT EVEN WHEN A LEASEHOLD RIGHT IN LAND OR BUILDING OR BOTH IS TRANSFERRED, THE PROVISIONS OF SECTION 50C CAN BE I NVOKED. 16. FROM THE READING OF SEC. 50C,IT IS EVIDENT THAT SEC. 50C IS A DEEMING PROVISION AND IT EXTENDS TO ONLY TO LAND OR BUILDING OR BOTH. SECTION 50C CAN COME INTO PLAY ONLY IN A SITUATION WHERE THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF T HE TRANSFER BY AN APPELLANT OF A CAPITAL ASSET, BEING LAND OR BUILDIN G OR BOTH IS LESS THAN THE VALUE ADOPTED OR ASSESSED OR ASSESSABLE BY ANY AUTHORITY OF STATE GOVERNMENT THEREFORE FOR THE PURPOSE OF PAYMENT OF STAMP DUTY IN RESPECT OF SUCH TRANSFER. IT IS SETTLED LEGAL PROPO SITION THAT DEEMING PROVISION CAN BE APPLIED ONLY IN RESPECT OF THE SIT UATION SPECIFICALLY GIVEN AND HENCE CANNOT GO BEYOND THE EXPLICIT MANDA TE OF THE SECTION. CLEARLY THEREFORE, IT IS ESSENTIAL THAT FO R APPLICATION OF SEC.50C THAT THE TRANSFER MUST BE OF A CAPITAL ASSE T, BEING LAND OR BUILDING OR BOTH. IF THE CAPITAL ASSET UNDER TRANSF ER CANNOT BE DESCRIBED AS LAND OR BUILDING OR BOTH THEN SECTIO N 50C WILL CEASE TO ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 12 APPLY. FROM THE FACTS OF THE CASE NARRATED ABOVE, I T IS SEEN THAT THE ASSESSEE HAS TRANSFERRED BOOKING RIGHTS AND RECEIVE D BACK THE BOOKING ADVANCE. BOOKING ADVANCE CANNOT BE EQUATED WITH THE CAPITAL ASSET AND THEREFORE SECTION 50C CANNOT BE I NVOKED. 17. WE HAVE PERUSED THE CASE LAWS RELIED BY LD. DR. ALL THOSE CASE LAWS ARE DISTINGUISHABLE ON FACTS. AS THE FACTS OF THE PRESENT CASE ARE DIFFERENT, THE RATIO OF THE JUDGMENTS RELIED UPON B Y THE LD. D.R. CANNOT BE APPLIED TO THE PRESENT CASE. 18. IN VIEW OF THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE, WE THEREFORE, ARE IN AGREEMENT WITH THE CONCLUSION ARR IVED AT BY CIT (A) ON THIS ASPECT AND THEREFORE RELIEF GRANTED BY CIT( A) DESERVES TO BE UPHELD. 19. IN THE RESULT THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN OPEN COURT ON 13-4 - 2012. SD/- SD/- (G.C.GUPTA) (ANIL CHATURVEDI VICE PRESIDENT ACCOUNTANT MEMBER AHMEDABAD. S.A.PATKI. ITA NO.2 519/AHD/2009 ASSESSME NT YEAR 2006- 07 . 13 COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) III, SURAT. 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHMEDABAD. 1.DATE OF DICTATION 15 - 3 -2012 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING 21 / 3 / 2012 MEMBER.OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S 9 - 4 -2012. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 13 - 4 -2012 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 13 - 4 -2012 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 1 3 - 4 -2012. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..