MICHAEL JUDE FERNANDES, MUMBAI V. ASST CIT16(2), MUMBAI

ITA 3557/MUM/2014

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 0215 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2017
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 19-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMAR
• Keywords: Capital asset; Cost of acquisition
• Section: 143(3); 54F; 2(14); 133(6); 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH B, MU MBAI BEFORE SHRI G.S. PANNU, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO.3557/MUM/2014 (ASSESSMENT YEAR- 2010-11) SHRI MICHEAL JUDE FERNANDES 6, 2 ND FLOOR, SATYABHAMA BUILDING, TUKARAM JHAVJI MARG, GRANT ROAD, MUMBAI-400007 PAN: AAAPF7795F VS. ACIT -16(2), ROOM NO. 207, MATRU MANDIR, TARDEO ROAD, MUMBAI-400007 (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI ADITYA AJGAONKAR (AR) REVENUE BY : SHRI SUMAN KUMAR (DR) DATE OF HEARING : 11.08.2017 DATE OF PRONOUNCEMENT : 18.08.2017 ORDER UNDER SECTION 254(1) OF INCOME TAX ACT PER PAWAN SINGH, JUDICIAL MEMBER: 1. THIS APPEAL BY ASSESSEE U/S 253 OF THE INCOME TAX A CT (THE ACT) IS DIRECTED AGAINST THE ORDER OF LD. CIT(A)-27, MUMBAI DATED 28.02.2014 FOR ASSESSMENT YEAR 2010- 11. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS O F APPEAL: 1. ADDITIONS BY TREATING THE LONG TERM CAPITAL GAIN OF RS. 2,34,55,080/-. (A) COMMISSIONER OF INCOME TAX APPEALS ERRED IN CONFI RMING THE ADDITIONS OF RS. 2,34,55,080/- BY TREATING THE LONG TERM CAPITAL GAIN AS SHORT TERM CAPITAL GAIN ON SALE OF RESIDENTIAL PROP ERTY. (B) APPELLANT PRAYS THAT ABOVE ADDITIONS OF RS. 2,34,55 ,080/- BE DELETED. 2. THE APPELLANT CRAVES TO ADD, AMEND OR ALTER ANY OF THE ABOVE GROUND OF APPEAL ON OR BEFORE THE APPEAL HEARING. 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED RETURN OF INCOME FOR RELEVANT ASSESSMENT YEAR ON 28.03.2011 DECLARING TOTAL INCOM E OF RS. 6,06,61,470/-. THE ASSESSMENT WAS COMPLETED U/S 143(3) OF THE ACT ON 1 5.03.2013. IN THE COMPUTATION ITA NO. 3557/M/2014- SHRI MICHEAL JUDE FERNANDES 2 OF INCOME, THE ASSESSEE COMPUTED THE LONG TERM CAPI TAL GAIN (LTCG) ON SALE OF RIGHT IN PROPERTIES. HOWEVER, THE ASSESSING OFFICER (AO) TREATED THE LTCG AS SHORT TERM CAPITAL GAIN (STCG) AND NOT ALLOWED THE DEDUCTION U/S 54EC AND 54F OF THE ACT. ON APPEAL BEFORE THE LD. CIT(A), THE AC TION OF AO WAS CONFIRMED. AGGRIEVED, FURTHER THE ASSESSEE HAS FILED THIS APPE AL BEFORE US. 3. WE HAVE HEARD THE LD. AUTHORIZED REPRESENTATIVE (AR ) OF THE ASSESSEE AND LD. DEPARTMENTAL REPRESENTATIVE (DR) FOR THE REVENUE AN D PERUSED THE MATERIAL AVAILABLE ON RECORD. THE LD. AR OF THE ASSESSEE ARG UED THAT ASSESSEE BOOKED TWO FLATS ON 12.05.2014. THE AGREEMENT TO SALE IN RESPE CT OF FLATS BETWEEN BUILDER AND THE ASSESSEE WAS EXECUTED ON MADE ON 16.11.2006. T HE AGREEMENT TO SALE WAS REGISTERED WITH SUB- REGISTRAR ON 06.10.2007. THE OCCUPANCY CERTIFICATE FROM THE BUILDER WAS RECEIVED ON 22.06.2009. NO OBJECTIO N CERTIFICATE (NOC) FOR TRANSFER OF THE FLAT WAS GIVEN BY THE BUILDER TO TH E ASSESSEE ON 18.10.2009. THE ASSESSEE SOLD THESE FLATS TO MR. & MRS. SONI BY REG ISTERED AGREEMENT TO SALE DATED 18.11.2009. THE AGREEMENT TO SALE WAS REGISTERED ON 19.11.2009. CONSEQUENT UPON THE AGREEMENT TO SALE BY ASSESSEE WITH MR. & MRS. S ONI, THE POSSESSION OF FLATS WERE DIRECTLY HANDED OVER BY BUILDER TO THE PURCHAS ER ON 19.12.2009. THE LD. AR OF THE ASSESSEE FURTHER ARGUED THAT ASSESSEE PAID T HE ADVANCE TO THE BUILDER ON 12.05.2004 I.E. THE DATE OF BOOKING AND THE SAME SH OULD BE CONSIDERED AS DATE OF ACQUISITION OF THE PROPERTIES. THE ASSESSEE OFFERED LTCG OF RS. 96,83,131/- AFTER TAKING BENEFIT OF SECTION 54EC & 54F OF THE ACT. TH E ASSESSEE LATER ON SOUGHT TO REVISE THE CAPITAL GAIN BY INCLUDING THE BENEFIT OF INDEXATION. THUS, THE LTCG WAS REVISED TO RS. 79,41,752/-. HOWEVER, THE AO HOL D THAT THE ASSESSEE PURCHASED ITA NO. 3557/M/2014- SHRI MICHEAL JUDE FERNANDES 3 ONLY RIGHT IN THE SAID PROPERTY AND THE AGREEMENT T O SALE DOES NOT CREATE ANY RIGHT IN FAVOUR OF ASSESSEE, THE ASSESSEE BECAME LEGAL OW NER OF PROPERTY FOR THE FIRST TIME WHEN OCCUPANCY CERTIFICATE WAS ISSUED. ACCORDING TO AO, THE DATE OF ACQUISITION OF THE SAID FLAT WAS TO BE CONSIDERED THE DATE OF O CCUPANCY CERTIFICATE AND ACCORDINGLY THE GAIN ARISING OUT OF SALE OF FLAT WA S TREATED AS STCG INSTEAD OF LTCG, THE LD. CIT(A) CONFIRMED THE ACTION OF AO HOL DING THAT ASSESSEE HIMSELF CLAIMED ON 06.11.2006 AS DATE OF ACQUISITION FROM T HE BUILDER. THE NOC WAS AVAILED ON 18.09.2009. THE LD. CIT(A) ALSO CONCLUDE D THAT ASSESSEE HAS INTENTIONALLY AND DELIBERATELY WAITED FOR MECHANICA L LAPSE OF 36 MONTHS AND DELIBERATELY PUT THE AGREEMENT DATED 16.11.2009 TO AVOID THE PAYMENT OF TAX TO SUBSTANTIATE HIS ARGUMENT, THE LD. AR OF THE ASSESS EE FURTHER RELIED UPON THE SECTION 2(47) OF THE ACT WHICH DEALS WITH THE DEFINITION OF TRANSACTION. 4. ON THE OTHER HAND THE LD DR FOR THE REVENUE SUPPORT ED THE ORDERS OF AUTHORITIES BELOW. IT WAS ARGUED THAT THE ASSESSEE ACQUIRED RIG HT IN THE PROPERTY IS ONLY ON THE DATE OF REGISTRATION OF THE AGREEMENT AND NOT FROM THE DATE OF BOOKING. THE AGREEMENT WAS REGISTERED ON 16 NOVEMBER 2006. IN SU PPORT OF HIS SUBMISSION THE LEARNED DR FOR THE REVENUE RELIED UPON THE DECISION OF HONBLE DELHI HIGH COURT IN GULSHAN MALIK VERSUS CIT ( ITA NO. 55/2014) DATE D 14 MARCH 2014. IN THE REJOINDER ARGUMENTS THE LEARNED AND AR OF THE ASSES SEE SUBMITTED THAT THE DECISION RELIED REVENUE IS MORE FAVORABLE TO ASSESSEE. 5. WE HAVE CONSIDERED THE RIVAL CONTENTION OF THE PART IES AND THE DECISION RELIED BY REVENUE. THE ASSESSING OFFICER WHILE FRAMING ASSESS MENT ORDER ASKED THE ASSESSEE TO SUBMIT THE VARIOUS DETAILS IN RESPECT OF LONG-TE RM CAPITAL GAIN AND THE DEDUCTION ITA NO. 3557/M/2014- SHRI MICHEAL JUDE FERNANDES 4 CLAIMED UNDER SECTION 54 EC AND 54F. THE ASSESSEE F URNISHED THE REQUIRED DETAILS AND CONTENDED THAT THE ASSESSEE ACQUIRED TWO FLATS ON 12 MAY 2005, ON THE DATE THE ASSESSEE PURCHASED FLAT AND CLAIMED THAT THAT BENEF IT OF INDEXATION SHOULD BE GIVEN ON THE BASIS OF DATE OF ACQUISITION OF CAPITAL ASSE TS AND NOT ON THE BASIS OF ACTUAL PAYMENTS. THE ASSESSING OFFICER ISSUED NOTICE TO TH E BUILDER UNDER SECTION 133(6) TO SUBMIT THE COMPLETE DETAILS OF PAYMENT RECEIVED AGA INST THE SALE OF FLATS, COPY OF AGREEMENT, STATUS OF BUILDING AT THE TIME OF SALE A ND THE COMPLETION CERTIFICATE. IN RESPONSE TO THE NOTICE UNDER SECTION 133(6) THE BUI LDER, VIDE ITS REPLY DATED 12.02.2013 SUBMITTED THAT AT THE TIME OF SALE, THE CONSTRUCTION OF SAID BUILDING WAS IN PROGRESS AND APPROXIMATELY COMPLETED TO THE EXTE NT OF 32%. THE BUILDER FURTHER SUBMITTED THAT THE AGREEMENT FOR TWO FLATS WAS EXEC UTED ON 16TH NOVEMBER 2006, WHICH WAS REGISTERED IN THE OFFICE OF SUB- REGISTRA R ON 6 OCTOBER 2007 IN THE NAME OF ASSESSEE AND HIS WIFE. THE BUILDER FURTHER INFOR MED THAT OCCUPATION CERTIFICATE OF BUILDING WAS RECEIVED ON 22 OCTOBER 2009. THE SAID FLATS WERE SOLD BY ASSESSEE AND HIS WIFE TO MRS AND MR SURESH CHANDRA SONI VIDE AGREEMENT TO SALE EXECUTED ON 18 NOVEMBER 2009 AND REGISTERED ON 19 NOVEMBER 2 009. THE BUILDER ALSO SUBMITTED THAT THE NOC WAS GIVEN FOR THE SALE OF TH E FLATS. ON THE BASIS OF INFORMATION SUBMITTED BY ASSESSEE AND THE BUILDER T HE ASSESSING OFFICER CONCLUDED THAT THE ASSESSEE WAS HOLDING ONLY RIGHT IN THE SAI D PROPERTY, THE ASSESSEE SOLD THE SAID RIGHTS BEFORE COMPLETION OF THE BUILDING BY WA Y OF TRIPARTITE AGREEMENT WITH BUILDER AND PURCHASES. THE ASSESSEE COULD CLAIM TH E COST OF ACQUISITION OF THE FLAT TO BE THE DATE OF FIRST AGREEMENT AND WITH THE BUIL DER. THUS, THE ASSESSEE HAS SOLD ONLY RIGHT IN THE PROPERTY IN QUESTION. THE ASSESSE E RECEIVED THE OCCUPATION ITA NO. 3557/M/2014- SHRI MICHEAL JUDE FERNANDES 5 CERTIFICATE ONLY ON 22 ND OF OCTOBER 2009 AND BECAME OWNER ONLY ON RECEIPT O F OCCUPATION CERTIFICATE. THEREFORE, THE DATE OF ACQU ISITION OF FLAT FOR ASSESSEE IS 22 ND OF OCTOBER 2009. THE ASSESSEE EXECUTED AGREEMENT TO SALE IN FAVOUR OF PURCHASE ON 18 TH NOV2009; HOWEVER THE STAMPING ON THE SAID AGREEMEN T IS OF 6 TH NOVEMBER 2009. THE ASSESSING OFFICER CONCLUDED THAT THE TRAN SACTION OF SALE OF SAID FLIGHT WAS FACTUALLY DONE ON 06 NOVEMBER 2009. THE ASSESSE E HAS PURPOSELY PUT THE DATE OF ACQUISITION OF THE SAID AGREEMENT AS 18 TH NOVEMBER 2009, WITH A VIEW TO MAKE THE LONG-TERM CAPITAL GAIN. WITH THESE OBSERVATIONS THE ASSESSING OFFICER TREATED THE CAPITAL GAIN AS SHORT-TERM CAPITAL GAIN AND D ISALLOWED EXEMPTION UNDER SECTION 54EC AND 54F. 6. WE HAVE SEEN THAT THE REVENUE HAS NOT DISPUTED THE DATE OF EXECUTION OF AGREEMENT TO SALE DATED 16.11.2006, EXECUTED BY BUILDER IN FA VOUR OF THE ASSESSEE. THE REVENUE HAS TWO FOLD OBJECTIONS. NUMBER ONE THAT TH E ASSESSEE ACQUIRED THE RIGHT IN THE PROPERTY ONLY ON REGISTRATION OF THE AGREEMENT ON 06.10.2007AND NOT ON 16.11.2006. SECONDLY, WHILE EXECUTING THE AGREEMENT TO SALE IN FAVOUR OF BUYER, THE ASSESSEE HAS INTENTIONALLY WAITED TILL 18.11.20 09, THOUGH THE STAMP DUTY WAS PAID ON 06.11.2009. THE LD. CIT(A) ALSO CONCLUDED T HAT ASSESSEE HAS INTENTIONALLY AND DELIBERATELY WAITED FOR MECHANICAL LAPSE OF 36 MONTHS AND DELIBERATELY PUT THE DATE ON AGREEMENT AS 18.11.2009 TO AVOID THE PAYM ENT OF TAX. THE HONBLE DELHI COURT IN GULSHAN MALIK VS CIT (SUPRA) WHICH IS RELI ED BY LD DR FOR THE REVENUE IS MORE FAVORABLE TO THE ASSESSEE. IN THE SAID CASE TH E HONBLE COURT CONSIDERED THE QUESTION WHETHER THE DATE OF ALLOCATION FOR ALLOT MENT OF THE APARTMENT OR THE DATE OF BUYERS AGREEMENT OUGHT TO BE CONSIDERED THE DAT E OF ACQUISITION OF THE CAPITAL ITA NO. 3557/M/2014- SHRI MICHEAL JUDE FERNANDES 6 ASSET. THE HONBLE HIGH COURT ANSWERED THE SAID QU ESTION WITH THE FOLLOWING OBSERVATION. 4 . THE QUESTION THAT ARISES FOR CONSIDERATION IS WHE THER ANY RIGHT ACCRUED TO THE ASSESSEE BY WAY OF THE APPLICATION FOR ALLOTMENT TH AT CAN BE CONSIDERED A CAPITAL ASSET; THIS WOULD DETERMINE WHETHER THE DATE OF APP LICATION FOR ALLOTMENT OF THE APARTMENT OR THE DATE OF THE BUYER'S AGREEMENT OUGH T TO BE CONSIDERED THE DATE OF ACQUISITION OF THE CAPITAL ASSET THAT WAS SOLD ON 2 .11.2007 AS WELL AS WHETHER THE CAPITAL GAIN IS TAXABLE AS LONG-TERM OR SHORT-TERM CAPITAL GAINS. 5. THE APPELLANTS SUBMIT THAT BY WAY OF A PPLICATION DATED 31.7.2004 FOR ALLOTMENT AND PAYMENT OF THE BOOKING AMOUNT, THE APPELLANT HAD AC QUIRED THE'RIGHT TO PURCHASE THE PROPERTY'/BOOKING RIGHTS, WHICH WERE EXTINGUISH ED BY EXECUTION OF THE AGREEMENT TO SELL DATED 2.11.2007 IN FAVOUR OF SMT. SRILEKHA NAYAK, THUS MAKING HIS BOOKING RIGHTS A LONG-TERM CAPITAL ASSET, HELD FOR A PERIOD OF 39 MONTHS AND 2 DAYS. ALTERNATIVELY, THE APPELLANT SUBMITS PLACING RELIAN CE ON COMMISSIONER OF INCOME TAX V. VED PARKASH AND SONS (HUF ), [1994] 207 ITR 148 THAT RIGHTS IN THE APARTMENT WERE ACQUIRED ON THE DATE OF RECEIPT OF A LLOTMENT LETTER I.E. 6.8.2004, BY WHICH THE APARTMENT WAS PROVISIONALLY ALLOTTED TO H IM, WHICH RIGHTS WERE SOLD ON 2.11.2007 THUS MAKING HIS RIGHT IN THE APARTMENT A LONG-TERM CAPITAL ASSET. THE TWO GROUNDS FOR THIS SUBMISSION ARE FIRST, THAT SECTION 2(47) OF THE ACT, WHICH DEFINES 'TRANSFER' IN RELATION TO A CAPITAL ASSET, IS A WID E AND INCLUSIVE DEFINITION THAT ENCOMPASSES EVEN TRANSFER OF A RIGHT IN PROPERTY, T HUS INCLUDING WITHIN ITS AMBIT, TRANSFER OF BOOKING RIGHTS, SECOND, THAT A COMBINED READING OF SECTIONS 2(14) AND 2(47) OF THE ACT SHOW THAT TRANSFER OF A CAPITAL AS SET IS NOT RESTRICTED TO TRANSFER OF OWNERSHIP IN IMMOVABLE PROPERTY ALONE. THE LEARNED COUNSEL FOR THE REVENUE, ON THE OTHER HAND, RELIES ON THE ORDER OF THE LEARNED ITAT MEMBER WHO HELD THAT BOOKING RIGHTS ACCRUED IN THE ASSESSEE ONLY ONCE THE BUYER' S AGREEMENT OF 4.11.2004 WAS SIGNED, THUS MAKING THE PROFITS FROM SALE TAXABLE A S SHORT-TERM CAPITAL GAINS. 6. IT WOULD BE APPROPRIATE TO EXTRACT SECT ION 2(14), 2(42A), 2(47) HERE IN RELEVANT PART. SECTION 2 OF THE ACT READS: ITA NO. 3557/M/2014- SHRI MICHEAL JUDE FERNANDES 7 '2. IN THIS ACT, UNLESS THE CONTEXT OTHERWISE REQUIRES, - (14) 'CAPITAL ASSET' MEANS PROPERTY OF ANY KIND HELD BY AN ASSESSEE, WHETHER O R NOT CONNECTED WITH HIS BUSINESS OR PROFESSION, BUT DOES NOT INCLUDE - XXX (42A) 'SHORT-TERM CAPITAL ASSET' MEANS A CAPITAL ASSET HELD BY AN ASSESSEE FOR NOT MORE THAN THIRTY-SIX MONTHS IMMEDIATELY PRECEDING THE DA TE OF ITS TRANSFER: XXX (47) 'TRANSFER', IN RELATION TO A CAPITA L ASSET, INCLUDES, - (I) THE SALE, EXCHANGE OR RELINQ UISHMENT OF THE ASSET ; OR (II) THE EXTINGUISHMENT OF ANY RI GHTS THEREIN ; OR (III) THE COMPULSORY ACQUISITION T HEREOF UNDER ANY LAW ; OR (IV) IN A CASE WHERE THE ASSET IS CONVERTED BY THE OWNER THEREOF INTO, OR IS TREAT ED BY HIM AS, STOCK-IN-TRADE OF A BUSINESS CARRIED ON BY HIM, SUCH CONVERSION OR TREATMENT ; OR (IVA) THE MATURITY OR REDEMPTION OF A ZERO COUPON BOND ; (V) ANY TRANSACTION INVOLVING THE ALLOWING OF THE POSSESSION OF ANY IMMOVABLE PROPERTY TO BE TAKEN OR RETAINED IN PART PERFORMANC E OF A CONTRACT OF THE NATURE REFERRED TO IN SECTION 53A OF THE TRANSFER OF PROPERTY ACT, 1882 (4 OF 1882) ; OR (VI) ANY TRANSACTION (WHETHER BY WAY OF BECOMING A MEMBER OF, OR ACQUIRING SHARES IN, A CO-OPERATIVE SOCIETY, COMPANY OR OTHER ASSOCI ATION OF PERSONS OR BY WAY OF ANY AGREEMENT OR ANY ARRANGEMENT OR IN ANY OTHER MA NNER WHATSOEVER) WHICH HAS THE EFFECT OF TRANSFERRING, OR ENABLING THE ENJ OYMENT OF, ANY IMMOVABLE PROPERTY. EXPLANATION 1.-- XXX EXPLANATION 2.--FOR THE REMOVAL OF DOUBTS, IT IS HEREBY CLARIFIED THAT 'TRANSFER' INCLUDES AND SHALL BE DEEMED TO HAVE ALWAYS INCLUDE D DISPOSING OF OR PARTING WITH AN ASSET OR ANY INTEREST THEREIN, OR CREATING ANY INTEREST IN ANY ASSET IN ANY MANNER WHATSOEVER, DIRECTLY OR INDIRECTLY, ABSOLUTE LY OR CONDITIONALLY, VOLUNTARILY OR INVOLUNTARILY, BY WAY OF AN AGREEMEN T (WHETHER ENTERED INTO IN INDIA OR OUTSIDE INDIA) OR OTHERWISE, NOTWITHSTANDI NG THAT SUCH TRANSFER OF RIGHTS HAS BEEN CHARACTERISED AS BEING EFFECTED OR DEPENDE NT UPON OR FLOWING FROM THE TRANSFER OF A SHARE OR SHARES OF A COMPANY REGISTER ED OR INCORPORATED OUTSIDE INDIA....' 7. IT IS CLEAR THAT A 'CAPITAL ASSET' UNDER THE ACT IS PROPERTY OF 'ANY KIND' THAT IS 'HELD' BY THE ASSESSEE. NECESSARILY, A CAPITAL ASSET MUST BE TRANSFERABLE. THUS, TO UNDERSTAND WHAT KIND OF PROPERTY CAN BE CONSIDERED A CAPITAL ASSET, IT WOULD BE APPOSITE TO REFER TO THE DEFINITION OF TRANSFER IN SECTION 2(47) OF THE ACT. SECTION 2(47)(V) AND(VI), AND EXPLANATION 2 MAKE IT ADEQUATELY CLEA R THAT POSSESSION, ENJOYMENT OF IMMOVABLE PROPERTY, AS WELL AS AN INTE REST IN ANY ASSET ARE ALL TRANSFERABLE 'CAPITAL ASSETS'. THE REFERENCE TO ACQ UISITION 'BY WAY OF ANY AGREEMENT OR ANY ARRANGEMENT OR IN ANY OTHER MANNER WHATSOEVE R' ESTABLISHES THAT IT IS NOT CONVEYANCE OF PROPERTY OR THE DOCTRINE OF PART PERF ORMANCE (ENACTED ITA NO. 3557/M/2014- SHRI MICHEAL JUDE FERNANDES 8 THROUGH SECTION 53A OF THE TRANSFER OF PROPERTY ACT) WHICH RESULT IN E NFORCEABLE RIGHTS, FOR THE PURPOSES OF THE INCOME TAX. THE SCH EME OF THE ACT PUTS IT BEYOND DOUBT THAT EVEN RIGHTS OR INTERESTS IN A PROPERTY A RE KINDS OF PROPERTY THAT ARE TRANSFERABLE CAPITAL ASSETS. THUS, THERE IS NO DOUB T THAT BOOKING RIGHTS OR RIGHTS TO PURCHASE THE APARTMENT OR RIGHTS TO OBTAIN TITLE TO THE APARTMENT ARE ALSO CAPITAL ASSETS THAT CAN BE TRANSFERABLE. HOWEVER, EVEN WHIL E THIS COURT AGREES WITH THE SUBMISSIONS OF THE APPELLANT, IT IS PERTINENT TO NO TE THAT THIS QUESTION DOES NOT ARISE IN THESE FACTS. NEITHER THE CIT-(A) NOR THE ITAT HA VE HELD THAT A CAPITAL ASSET CAN ONLY BE TITLE TO/OWNERSHIP OF THE APARTMENT. THE OR DER OF THE CIT-A LOCATES THE SOURCE OF THE BOOKING RIGHTS I.E. DATE OF ACQUISITI ON OF CAPITAL ASSET AS THE BUYER'S AGREEMENT DATED 4.11.2004, WHICH FINDING IS SUBSEQU ENTLY CONFIRMED BY THE ITAT BY ADDITIONALLY RELYING ON THE RECEIPTS AT THE TIME OF CONFIRMATION OF ALLOTMENT. THUS, IN THESE FACTS, THE QUESTION OF WHETHER THE BOOKING RI GHTS ARE A TRANSFERABLE CAPITAL ASSET IS NOT CONTENTIOUS. THE JUDGMENT IN VED PARKA SH (SUPRA) IS ALSO CONSEQUENTLY OF NO ASSISTANCE IN THIS MATTER SINCE THE REASONING THEREIN TURNS ON WHETHER 'CAPITAL ASSET' REFERS ONLY TO TITLE TO PROPERTY AS OPPOSED TO OTHER RIGHTS/INTERESTS IN THE PROPERTY. 8. THIS BEING THE CASE, THE ONLY QUESTION THAT ARISES FOR CONSIDERATION IS WHETHER THE BOOKING RIGHTS TO THE APARTMENT ACCRUED TO THE ASSE SSEE ON THE DATE OF APPLICATION FOR ALLOTMENT/CONFIRMATION OF ALLOTMENT OR ON THE D ATE OF EXECUTION OF THE AGREEMENT TO SELL I.E. THE BUYER'S AGREEMENT. THIS COURT IS O F THE OPINION THAT A RIGHT OR INTEREST IN AN IMMOVABLE PROPERTY CAN ACCRUE ONLY BY WAY OF AN AGREEMENT EMBODYING CONSENSUS AD IDEM. THE NATURE OF THE RIGHT SOUGHT T O BE TRANSFERRED HERE IS THE RIGHT TO PURCHASE THE APARTMENT AND OBTAIN TITLE, TERMED 'BOOKING RIGHTS'. ONLY THAT AGREEMENT WHICH INTENDS TO CONVEY THESE RIGHTS ACCO RDING TO BOTH PARTIES CAN BE CONSIDERED AS THE SOURCE OF ACCRUAL OF RIGHTS TO TH E ASSESSEE. THE CONFIRMATION LETTER DATED 6.8.2004 (ANNEXURE 3) SPECIFICALLY STATES FIR ST, THAT NO RIGHT TO PROVISIONAL/FINAL ALLOTMENT ACCRUES UNTIL THE BUYER'S AGREEMENT IS SI GNED AND RETURNED TO THE BUILDERS AND SECOND, THAT NO RIGHT TO CLAIM TITLE/OWNERSHIP RESULTS FROM THE CONFIRMATION LETTER ITSELF. THUS, IT IS CLEAR THAT THE BUILDERS DO NOT INTEND TO CONVEY ANY RIGHT OF PROVISIONAL/FINAL ALLOTMENT OR ANY RIGHT TO CLAIM T ITLE/OWNERSHIP UNDER THE CONFIRMATION LETTER. THERE BEING NO INTENTION TO CO NVEY RIGHTS IN THIS DOCUMENT, IT WOULD BE IMPERMISSIBLE FOR THIS COURT TO FIND THAT THE RIGHT TO OBTAIN TITLE/'BOOKING RIGHTS' EMANATED FROM THE CONFIRMATION LETTER. THES E RIGHTS MAY ONLY BE LOCATED IN THE BUYER'S AGREEMENT, AND THUS, THE DATE OF ACQUIS ITION OF THE CAPITAL ASSET MUST BE CONSIDERED THE DATE OF SIGNING OF SAID AGREEMENT I. E. 4.11.2004. 7. IN VIEW OF THE ABOVE FACTUAL DISCUSSION AND THE DEC ISION OF HONBLE DELHI COURT THE DATE OF EXECUTION OF AGREEMENT TO SALE OF FLAT (16. 11.2006) SHOULD BE TREATED AS DATE OF ACQUISITION OF CAPITAL ASSET. THE ASSESSEE SOLD THE CAPITAL ASSET BY AGREEMENT DATED ITA NO. 3557/M/2014- SHRI MICHEAL JUDE FERNANDES 9 18.11.2009, TO MR & MRS SONI, AGAIN IN THE DECISION OF HONBLE DELHI COURT CAME IN RESCUE TO THE ASSESSEE AS THE OR INTEREST IN IMM OVEABLE PROPERTY CAN ACCRUE BY WAY OF AGREEMENT EMBODYING CONSENSUS AD IDEM . THE OBJECTION OF THE REVENUE THAT THE ASSESSEE INTENTIONALLY WAITED FOR MECHANICAL LA PSE OF 36 MONTHS AND DELIBERATELY PUT THE DATE ON AGREEMENT AS 18.11.2009 TO AVOID TH E PAYMENT OF TAX IS NOT TENABLE. EVERY INDIVIDUAL HAS A RIGHT TO DEAL HIS ASSET AS P ER HIS OWN CHOICE AND CONVENIENCE AND THE REVENUE CANNOT DICTATE ANY PARTICULAR WAY U NLESS OTHERWISE THE TRANSACTION IS PROHIBITED BY LAW. THUS, IN OUR CONSIDERED VIEW THE ASSESSEE ACQUIRED THE CAPITAL ASSET ON 16.11.2006 AND TRANSFERRED IT ON 18.11.200 9. HENCE, QUALIFIED FOR LONG- TERM CAPITAL GAIN (LTCG). WE MAY MAKE IT CLEAR THAT THE ASSESSEE WOULD BE ENTITLED FOR THE BENEFIT OF INDEXATION FROM 16.11.2 006 ONLY FOR THE PURPOSE OF CALCULATION THE LTCG. THE ASSESSING OFFICER IS FURT HER DIRECTED TO ALLOW THE DEDUCTION/BENEFIT OF RS.50,00,000/- UNDER SECTION 5 4EC AND 54F AFTER VERIFICATION OF FACTS. THUS THE GROUNDS OF APPEAL RAISED BY ASS ESSEE ARE ALLOWED. 8. IN THE RESULT APPEAL FILED BY ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH DAY OF AUGUST 2017. SD/- SD/- (G.S. PANNU) (PAWAN SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED 18/08/2017 S.K.PS COPY OF THE ORDER FORWARDED TO : BY ORDER, (ASSTT.REGISTRAR) ITAT, MUMBAI 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A), MUMBAI. 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. //TY/