Appeal Details
Counselvise Citation
[2014] 140 COUNSELVISE.COM (IT) 75311 (ITAT-MUMBAI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
6 year(s) 8 month(s) 1 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
24-01-2014
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
F
Next Hearing Date
21-01-2014
Assessment Year
1989-1990
Appeal Filed On
23-05-2007
Judgement Text
- 1 - VK;DJ VIHYH; VF/KDJ.K ,Q U;K;IHB EQACBZ ESAA IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUM BAI JH VKJ JH VKJ JH VKJ JH VKJ- -- - LH LHLH LH- -- - 'KEKZ] YS[KK LNL; ,OA 'KEKZ] YS[KK LNL; ,OA 'KEKZ] YS[KK LNL; ,OA 'KEKZ] YS[KK LNL; ,OA JH VFER 'KQDYK JH VFER 'KQDYK JH VFER 'KQDYK JH VFER 'KQDYK] U;KF;D LNL; DS ] U;KF;D LNL; DS ] U;KF;D LNL; DS ] U;KF;D LNL; DS LE{K LE{K LE{K LE{K BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA, JUDICIAL MEMBER VK;DJ VIHY LA[;K /ITA NO.3992/MUM/2007 FU/KKZJ.K O'KZ @ ASSESSMENT YEAR 1989-90. VIJAY MORESHWAR VAITY MATRU BHAVAN, MALAVNI CHURCH, MARVE ROAD, MALAD (WEST) MUMBAI 400 095. CUKE@ VS. ITO 24(2)(4) MUMBAI ROOM NO. 408, BLDG, NO. C-10, PRATYAKSHA KAR BHAVAN, BANDRA KURLA COMPLEX BANDRA (EAST) MUMBAI 400 051. PAN:- ABUPV6173E VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VIHYKFKHZ DH VKSJ LS @ ASSESSEE BY SHRI VIPUL JOSHI IZR;FKHZ DH VKSJ LS @ REVENUE BY SHRI RAVI PRAKASH VKNS'K@ VKNS'K@ VKNS'K@ VKNS'K@ ORDER PER R.C. SHARMA, AM. THIS IS AN APPEAL, FILED BY THE ASSESSEE AGAINST TH E ORDER OF CIT(A) DATED 15.03.207 FOR A.Y. 1989-90, IN THE MATTER OF ORDER PASSED U/S 143(3) R.W.S 250 OF THE IT ACT. THE ONLY CONTROVERS Y INVOLVED IN THIS APPEAL RELATES TO ADDITION MADE OR RS. 700180 ON AC COUNT OF LONG TERM CAPITAL GAIN FROM TRANSFER OF CAPITAT ASSET OF FIVE PLOTS OF AGRICULTURAL LAND IN THE YEAR 1989-90. LQUOKBZ DH RKJH[K@ DATE OF HEARING 21 - 01 - 2014 ?KKS'K.KK DH RKJH[K@ DATE OF PRONOUNCEMENT 24 - 01 - 2014 - 2 - 2. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE CA REFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOU ND FROM RECORD THAT THE AO HAS BROUGHT TO TAX CAPITAL GAINS IN RESPECT OF AGRICULTURAL LOAN ALLEGED TO BE MORTGAGED BY THE ASSESSEE. AS PER LD. AR THE ASSESSEE HAS TAKEN LOAN FROM M/S SHIV SHAKTI CONSTRUCTION COMPAN Y THROUGH AGREEMENT DATED 9.7.1988. FURTHER CONTENTION OF THE ASSESSEE WAS THAT HE WAS IN NEED OF FUNDS FOR MAKING INVESTMENT IN HI S HOTEL PROJECT, THEREFORE, HE BORROWED RS. 1428055/- FROM M/S SHIV SHAKTI CONSTRUCTION COMPANY AND THE FUND SO TAKEN WAS IN T HE FORM OF LOAN AND NOT A SALE CONSIDERATION. FURTHER THE AGREEMENT DATED 9.7.1988 WAS MADE TO SAFEGUARD INTEREST OF THE LENDER, AS NO SA LE TAKEN PLACE, THREFORE, THERE WAS NO CAPITAL GAIN IN THE ASSESSM ENT YEAR UNDER CONSIDERATION. OUR ATTENTION WAS DRAWN TO THE COPY OF GOVERNMENT LAND RECORD, PLACED AT PAGE 49 TO 54 OF THE PAPER B OOK WHEREIN DATE OF EXECUTION OF SALE DEED OF SAID PLOT OF LAND WAS MEN TIONED AS 9-11-1998 OUR ATTENTION WAS ALSO INVITED TO THE POSSESSION LE TTER EXECUTED ON 9 TH NOVEMBER 1998, ACCORDING TO WHICH POSSESSION WAS HA NDED OVER TO M/S SHIV SHAKTI CONSTRUCTION COMPANY ONLY ON 9 TH NOVEMBER 1998, FALLING IN THE F.Y. 1998-99 CORRESPONDING TO THE A.Y. 1999-200 0. AS PER LD. AR AGREEMENT DATED 9.7.1988 WAS NOT EXECUTED AS THE SA ME WAS CANCELLED, THE TRANSACTION WAS A FINANCIAL TRANSACTION AND NO POSSESSION OF LAND WAS GIVEN IN THE PREVIOUS YEAR AND THE AGREEMENT WA S NOT A DEVELOPMENT AGREEMENT, HENCE PROVISIONS OF SECTION 2(47)(B) DID NOT APPLY. - 3 - 3. ON THE OTHER HAND LD. DR CONTENDED THAT AGREEMEN T OF SALE WAS EXECUTED ON 9.7.1988 WHEREIN POSSESSION WAS ALSO GI VEN TO M/S SHIV SHAKTI CONSTRUCTION COMPANY, WHO HAD ALSO STARTED C ONSTRUCTION THERE ON AND FOR WHICH THE ASSESSEE HAS ALSO RECEIVED MO ST OF THE PAYMENTS FROM M/S SHIV SHAKTI CONSTRUCTION COMPANY. AS PER L D. DR SINCE POSSESSION WAS GIVEN, THE PROVISIONS OF SECTION 2(4 7)(B) ARE APPLICABLE AND AO WAS CORRECT IN TREATING THE CAPITAL GAIN IN THE RELEVANT ASSESSMENT YEAR UNDER CONSIDERATION. 4. WE HAVE CONSIDERED RIVAL CONTENTION CAREFULLY AN D HAVE GONE THROUGH THE ORDERS OF AUTHORITIES BELOW AND FOUND F ROM RECORD THAT THERE WERE SO MANY TERMS AND CONDITIONS IN THE AGRE EMENT DATED 9.7.1988. AS THE CONDITIONS WERE NOT FULFILLED ANOT HER AGREEMENT WITH CORRECTION DATED 29.12.1988 WAS EXECUTED AND THE AG REEMENT DATED 9.7.1988 WAS CANCELLED. AS PER THE LAND RECORDS PRO DUCED BEFORE US, THE SAID LAND WAS TRANSFERRED THROUGH AGREEMENT EXECUTE D ON 9-11-1998, WHICH FALLS IN THE F.Y. 1998-99 CORRESPONDING TO A. Y. 1999-2000. AS PER OUR CONSIDERED VIEW UNDER THE PROVISIONS OF SECTION 2(47), TRANSFER WILL TAKE PLACE WHEN THE POSSESSION IS GIVEN. AS PER THE POSSESSION LETTER DATED 9.11.1998 PLACED ON RECORD, POSSESSION WAS GI VEN ON 9 TH NOVEMBER 1998 WHICH FALLS IN THE F.Y. 1998-99 RELEV ANT TO THE A.Y. 1999- 2000, THEREFORE, PROFIT FROM SALE OF LAND IS REQUIR ED TO BE TAXED IN THE ASSESSMENT YEAR 1999-2000. THIS POSSESSION LETTER A LSO REFERS TO THE AGREEMENT DATED 9.7.1988. LAND RECORD SO PRODUCED B Y LD. AR FOR THE FIRST TIME BEFORE US CLEARLY INDICATES THAT AGREEME NT WAS EXECUTED BETWEEN ASSESSEE AND M/S SHIV SHAKTI CONTRUCTION C O. ONLY ON 9.11.1998 AFTER THE POSSESSION WAS HANDED OVER TO T HEM. THESE LAND - 4 - RECORDS SHOWS THAT DATE OF EXECUTION OF THE AGREEME NT IS 9.11.1998 AND THE DATE OF REGISTRATION OF THE SAID AGREEMENT WAS DATED 7.12.1998. SINCE THESE LAND RECORDS WERE NOT BEFORE THE LOWER AUTHORITIES, WE IN THE INTEREST OF JUSTICE RESTORE THE MATTER BACK TO THE FILE OF AO TO VERIFY THE LAND RECORDS WHICH GOES TO THE ROOT OF THE ISSU E FOR ASCERTAINING YEAR OF TRANSFER OF LAND BY ASSESSEE STATED TO BE ON 9.1 1.1998. THERE IS NO DISPUTE TO THE WELL SETTLED PROPOSITION OF LAW THAT UNDER PROVISIONS OF SECTION 2(47) R.W.S 53 OF TRANSFER OF PROPER ACT, T RANSFER OF IMMOVABLE PROPERTY IS TAKEN IN THE YEAR THE ASSESSEE HAD GIVE N POSSESSION OF THE LAND. IF THE AO FINDS THAT POSSESSION WAS GIVEN IN THE YEAR 1998, CAPITAL GAIN SHOULD BE BROUGHT TO TAX IN THE FINANCIAL YEAR 1998-99 RELEVANT TO ASSESSMENT YEAR 1999-2000. AO IS TO DECIDE THE MATT ER AFRESH AFTER GIVING DUE OPPORTUNITY OF HEARING TO THE ASSESSEE. WE DIRECT ACCORDINGLY. 5. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPSES. ORDER PRONOUNCED ON 24 /01/2014 SD/- SD/- (AMIT SHUKLA) (R.C. SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI DATED 24 /01/2014 SKS SR. P.S - 5 - COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CONCERNED CIT(A) 4. THE CONCERNED CIT 5. THE DR, F BENCH, ITAT, MUMBAI BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCHES, MUMBAI
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