Prasang Steels Ltd., Delhi V. ITO, New Delhi

ITA 4258/DEL/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 58528 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 4 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-01-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 19-01-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 16-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROHIT GARGDR
• Assessee Lawyers: VIRENDRA KUMARAR
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Valuation report
• Section: 50C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI F BENC H BEFORE SHRI U.B.S. BEDI, JM & SHRI A.N. PAHUJA, AM ITA NO.4258/DEL/2010 ASSESSMENT YEAR:2007-08 M/S PRASANG STEELS LTD., 14, GIAN PARK, DELHI-110051 V/S. INCOME TAX OFFICER, WARD- 14(3),ROOM NO. 218,CR BUILDING, NEW DELHI-110001 [PAN: AAACP 4514 H] (APPELLANT) (RESPONDENT) ASSESSEE BY SHRI VIRENDRA KUMAR,AR REVENUE BY SHRI ROHIT GARG,DR DATE OF HEARING 19-01-2012 DATE OF PRONOUNCEMENT 25-01-2012 O R D E R A.N.PAHUJA:- THIS APPEAL FILED ON 16.09.2010 BY THE ASSESSEE AGA INST AN ORDER DATED 30.07.2010 OF THE LEARNED CIT(A)-XVII, NEW DE LHI, RAISES THE FOLLOWING GROUNDS:- 1. THAT THE HONBLE CIT(A)-XVII HAS NOT DISPOSED GRO UND NO.1 OF GROUNDS OF APPEAL PLACED BEFORE HIM, THAT ON THE BASIS OF FACTS AND CIRCUMSTANCES IT CANNOT BE CONCL UDED THAT THE APPELLANT COULD HAVE SOLD THE FACTORY LAND AT A PRICE DETERMINED BY THE ASSESSING OFFICER AND HENCE ENHAN CEMENT IN THE VALUE OF CONSIDERATION FOR CALCULATION OF LO NG TERM CAPITAL GAIN RESULTING FROM CAPITAL ASSETS IS WRONG AND BAD IN LAW. 2. THAT THE HONBLE CIT(A)-XVII HAS NOT DISPOSED GROU ND NO.3 OF GROUNDS OF APPEAL PLACED BEFORE HIM THAT THE FINDINGS OF THE ASSESSING OFFICER FOR THE VALUATION ARE ARBITRARY WHEREAS THE MATERIAL AVAILABLE ON RECORD HAS BEEN I GNORED HENCE CONSEQUENTIAL ADDITIONS DESERVES TO BE DELETE D. 3. THAT THE HONBLE CIT(A)-XVII HAS NOT DISPOSED GROU ND NO.4 OF GROUNDS OF APPEAL PLACED BEFORE HIM THAT ON THE BASIS OF FACTS AND CIRCUMSTANCES OF THE CASE THE AD DITION OF ITA N O.4258 /DEL./2010 2 LONG TERM CAPITAL GAIN INTO THE INCOME OF THE ASSES SEE IS INCORRECT AND WRONG AND NOT PERMISSIBLE UNDER THE L AW. 4. THAT THE COMMISSIONER APPEALS HAS ERRED HOLDING THAT THE PROVISIONS OF SECTION 50C(2) ARE APPLICABLE TO THE APPELLANT COMPANY. 5. YOUR APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR WITHDRAW ANY OF THE GROUNDS OF APPEAL AT THE TIME O F HEARING. 2. FACTS, IN BRIEF, AS PER RELEVANT ORDERS ARE THA T RETURN DECLARING INCOME OF ` `1,51,012/- FILED ON 08.10.2007 BY THE ASSESSEE, TR ADING IN DEPB LICENSES, WAS SELECTED FOR SCRUTINY WITH THE SERVIC E OF A NOTICE U/S 143(2) OF THE INCOME-TAX ACT, 1961 (HEREAFTER REFERRED TO AS THE ACT). DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER (A.O. IN SHORT) NOTICED THAT THE ASSESSEE SOLD IMMOVABLE PROPERTY I.E. A FACTORY SHE D FOR A CONSIDERATION OF ` `25 LACS WHILE STAMP DUTY WAS PAID ON AN AMOUNT OF ` `46,72,000/- IN TERMS OF SALE DEED EXECUTED ON 14 TH AUGUST, 2007 IN PURSUANCE TO AN AGREEMENT TO SELL DATED 8 TH JANUARY, 2007. THE AO NOTICED THAT THE ASSESSEE R ECEIVED AN AMOUNT OF ` `4 LACS DURING THE YEAR UNDER CONSIDERATION WHILE THE REMAINING AMOUNT WAS RECEIVED ON EXECUTION OF SALE DEED ON 14 TH AUGUST, 2007. SINCE THE STAMP DUTY WAS PAID ON SALE CONSIDERATION DETERMINED AT ` ` 46,72,000/- IN TERMS OF THE AFORESAID SALE DEED DATED 14 TH AUGUST, 2007, THE AO ADDED AN AMOUNT OF ` ` 10,99,885/- (`46,72,000 - `35,72,115) AS LONG TERM GAIN INSTEAD OF LOSS OF ` ` 10,72,115/- RETURNED BY THE ASSESSEE. 3. ON APPEAL, THE LEARNED CIT(A) UPHELD THE FINDIN GS OF THE AO IN THE FOLLOWING TERMS:- 3. I HAVE CAREFULLY CONSIDERED THE SUBMISSION MADE BY THE APPELLANT AND PERUSED THE ASSESSMENT ORDER PASSED B Y THE AO. IT IS SEEN THAT THE APPELLANT ENTERED INTO AGREEMENT T O SALE ON 8.1.2007.IT HAS BEEN SUBMITTED BY THE LD. AR THAT T HE APPELLANT HANDED OVER THE POSSESSION TO THE BUYER ON THE DATE OF AGREEMENT ITSELF. THUS, ADMITTEDLY THE POSSESSION WAS HANDED OVER ON 8.1.2007 ITSELF DURING THE ASSESSMENT YEAR UNDER CO NSIDERATION. ITA N O.4258 /DEL./2010 3 THE SALE CONSIDERATION AS PER THIS AGREEMENT WAS RS .25 LACS. BUT THE VALUE OF LAND FOR THE PURPOSES OF STAMP VALUATI ON WAS TAKEN AT RS.46,72,000/- AND THE APPELLANT PAID A STAMP DUTY OF RS.4,39,200/-.THE VALUE OF RS.46,72,000/- ADOPTED B Y THE STAMP VALUATION AUTHORITY WAS NOT CHALLENGED BY THE APPEL LANT IN ANY PROCEEDINGS. THUS, THE APPELLANT HAS ADMITTED THAT THE MARKET VALUE OF RS.46,72,000/- ADOPTED FOR THE PURPOSES OF STAMP VALUATION WAS CORRECT. THE APPELLANT HIMSELF HAS SU BMITTED THAT IT IS THE DATE OF AGREEMENT WHICH IS IMPORTANT FOR RECOGN IZING A TRANSACTION AND NOT THE DATE OF COMPLETION OR EXECU TION OF PROMISE WHICH GIVES CREATION OF TRANSACTION IN THE EYES OF LAW .IN THIS REGARD, IT WILL BE RELEVANT TO REPRODUCE THE PROVISIONS OF SECTION 50C OF THE ACT AS UNDER: [ 50C. SPECIAL PROVISION FOR FULL VALUE OF CONSIDERATION I N CERTAIN CASES (1) WHERE THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF THE 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 (HEREAFTER IN THIS 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 OR ASSESSABLE SHALL, FOR THE PURPOSES OF S ECTION 48, BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION RE CEIVED OR ACCRUING AS A RESULT OF SUCH TRANSFER. A GLANCE AT THE SECTION 50C MAKES IT CLEAR THAT IT IS SPECIAL PROVISION FOR TAKING THE FULL VALUE OF CONSIDERATIO N IN CERTAIN CASES OF TRANSFER OF PROPERTY. IT IS A DEEMING PROVISION WHI CH MAKES IT MANDATORY TO ADOPT THE VALUE OF CONSIDERATION WHICH HAS BEEN ADOPTED OR ASSESSED BY THE STAMP VALUATION AUTHORIT Y FOR THE PURPOSE OF COMPUTING THE CAPITAL GAINS. THE LD. AR VIDE HIS WRITTEN SUBMISSION HAS ADMITTED THAT THE ASSESSEE HAD RELIN QUISHED ITS RIGHT IN THE PROPERTY ON THE BASIS OF AGREEMENT TO SELL, THEREFORE, THE APPELLANT CONSIDERED IT TO BE THE MATTER COVERED UN DER SECTION 2(47) OF THE I.TAX ACT FOR THE FINANCIAL YEAR 2006- 07 RELEVANT TO THE ASSESSMENT YEAR 2007-08 AND CONSIDERED IT THE TRANS ACTION FALLING UNDER THE HEAD INCOME FROM CAPITAL GAIN. ONCE IT HA S BEEN ADMITTED THAT THE TRANSACTION WAS COMPLETED ON 08.0 1.2007 ITSELF I.E. THE DATE ON WHICH AGREEMENT TO SALE WAS EXECUT ED ,POSSESSION WAS ALSO HANDED OVER THE SAME DAY AND REGISTRATION OF THE SALE DEED WAS ONLY A FORMALITY, THE APPELLANT CANNOT CLA IM THAT PROVISIONS OF SECTION 50C WILL NOT BE APPLICABLE BE CAUSE THE SALE DEED WAS EXECUTED NEXT YEAR. THEREFORE, I DO NOT FI ND ANY MERIT IN THE SUBMISSION OF THE LD. AR. REGARDING THE LD. AR S SUBMISSION THAT THE AO SHOULD HAVE REFERRED THE VALUATION OF T HE PROPERTY TO THE VALUATION OFFICER U/S 50C(2), THE SAID SECTION DOES NOT MAKE ITA N O.4258 /DEL./2010 4 REFERENCE MANDATORY. THE LEGISLATURE HAS USED THE W ORD MAY WHICH INDICATES THAT THE AO MAY MAKE A REFERENCE TO THE VALUATION OFFICER. HOWEVER, THE APPELLANTS CASE IS COVERED B Y THE PROVISIONS OF SUB-SECTION-1 OF SECTION 50C.THEREFORE, THERE WA S NO NEED FOR THE AO TO REFER THE VALUATION OF THE PROPERTY TO TH E VALUATION OFFICER. HENCE, THE CONTENTION OF THE APPELLANT ARE REJECTED . IN VIEW OF THE ABOVE DISCUSSION, I AM OF THE CONSIDERED OPINION TH AT THE AO WAS JUSTIFIED IN MAKING THE ADDITION. THE ADDITIONS MAD E BY THE AO ARE CONFIRMED. THESE GROUNDS OF APPEAL ARE REJECTED. 4. THE ASSESSEE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDINGS OF THE LD. CIT(A). AT THE OUTSET, THE LD. AR ON BEHALF OF THE ASSESSEE SUBMITTED THAT THE AO WAS NOT JUSTIFIED IN ADOPTING SALE CONSIDERATION OF ` `46,72,000/- IN TERMS OF SALE DEED EXECUTED ON 14 TH AUGUST, 2007 FALLING IN THE PERIOD RELEVANT TO THE ASSESSMENT YEAR 2008-09, IN THE YEAR UNDER CONSIDERATION. TO A QUERY BY THE BENCH, AS TO WHETHER CAPITAL GAI NS ARE ASSESSABLE IN THE PERIOD FALLING IN THE AY 2008-09, THE LD. AR REPLI ED THAT THE REGISTRATION HAVING NOT BEEN DONE , THE PROVISIONS OF SEC. 50C WERE NOT APPLICABLE IN THE YEAR UNDER CONSIDERATION AND THE ASSESSMENT FOR THE AY 2008-09 WAS COMPLETED U/S 143(1) OF THE ACT. WHILE REFERRING TO AMENDMENT TO THE PR OVISIONS OF SECTION 50C OF THE ACT BY THE FINANCE ACT, 2009 W.E.F 1.10.2009, THE LD. AR ADDED THAT THE AMENDED PROVISIONS WERE NOT APPLICABLE IN THE YEAR UNDER CONSIDERATION.ON THE OTHER HAND, THE LD.DR WHILE CARRYING US THROUGH PAG E 40, 41 AND 46 OF THE PAPER BOOK AS ALSO THE IMPUGNED ORDER SUBMITTED THAT EITH ER THE IMPUGNED ORDER SHOULD BE UPHELD OR SUITABLE DIRECTIONS SHOULD BE I SSUED FOR ASSESSING THE CAPITAL GAINS IN THE AY 2008-09.THE LD. DR POINTED OUT THAT THERE IS NOTHING TO SUGGEST THAT THE POSSESSION WAS ALSO GIVEN AT THE TIME OF E NTERING IN TO AGREEMENT TO SELL. IN HIS REJOINDER, THE LD. AR SUBMITTED THAT DESPITE REQUEST MADE BY THE ASSESSEE, THE AO DID NOT REFER THE MATTER TO THE VALUATION OF FICER .THEREFORE, THE ASSESSEE SUBMITTED VALUATION REPORT OF THE REGISTERED VALUER . SINCE THE TRANSACTION WAS COMPLETE IN THE YEAR UNDER CONSIDERATION AND POSSES SION WAS ALSO GIVEN, CAPITAL GAINS ARE ASSESSABLE IN THE YEAR UNDER CONSIDERATIO N. HOWEVER, TO A QUERY BY THE BENCH IN THE CONTEXT OF VARIOUS CLAUSES IN THE AGRE EMENT TO SELL DATED 8.1.2007 AS ALSO CLAUSE 3 & 5 OF THE SALE DEED DATED 14.8.2 007, THE LD. AR DID NOT REFER ITA N O.4258 /DEL./2010 5 US TO ANY DOCUMENT ,SUGGESTING HANDING OVER OF POSS ESSION IN THE YEAR UNDER CONSIDERATION. INSTEAD, THE LD. AR ON BEHALF OF THE ASSESSEE REFERRED TO DECISIONS IN THE CASE OF UNION OF INDIA VS. CHAMAN LAL ,AIR 1957 SC 652; CARTON HOTEL PRIVATE LTD. VS. ACIT DATED 14.11.200 8 AND MEGHRAJ BAID VS. ITO DATED 14.2.2008 REPORTED IN TTJ AND MENTIONED IN T HE IMPUGNED ORDER. 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUG H THE FACTS OF THE CASE. AS IS APPARENT FROM THE AFORESAID FACTS, THE AO ,WITHOUT RECORDING ANY FINDINGS AS TO WHEN THE TRANSACTION OF SALE OF AFOR ESAID IMMOVABLE PROPERTY WAS COMPLETED OR WHEN THE POSSESSION OF THE SAID PROPER TY WAS HANDED OVER AND WITHOUT EVEN REFERRING TO PROVISIONS OF THE SECTION 50C OF THE ACT, ADDED THE AMOUNT OF ` ` 10,99,885/-,ADOPTING SALE CONSIDERATION OF 46,72,00 0/-.ON APPEAL, THE LD. CIT(A) WITHOUT EVEN REFERRING TO ANY EVIDEN CE AS TO WHEN THE POSSESSION OF IMMOVABLE PROPERTY WAS ACTUALLY HANDED OVER TO T HE BUYER, ACCEPTED THE SUBMISSIONS OF THE ASSESSEE THAT POSSESSION WAS HAN DED OVER AT THE TIME OF ENTERING IN TO AGREEMENT TO SELL ON 8.1.2007 AND BR OUGHT TO TAX LONG TERM CAPITAL GAINS IN TERMS OF PROVISIONS OF SEC. 50C OF THE ACT . THE LD. CIT(A) DID NOT EVEN REFER TO THE RELEVANT TERMS AND CONDITIONS IN THE AGREEMENT TO SELL DATED 8.1.2007 OR SALE DEED DATED 14.8.2007. HERE WE MAY HAVE A LOOK AT THE RELEVANT CLAUSES IN THE AGREEMENT TO SELL DATED 8 TH JANUARY, 2007 ENTERED INTO WITH SHRI SANJEEV MEHNDIRATTA ,WHEREIN, INTER ALIA, IT IS MENTIONED AS UNDER:- WHEREAS THE FIRST PARTY SELLER WILL EXECUTE THE SA LE DEED IN FAVOUR OF THE SECOND PARTY (PURCHASER) WITH IN THE PERIOD OF 3 MONTHS FAILING WHICH HE WILL RETURN THE AMOUNT OF AN ADVAN CE WITH INTEREST @12% PER ANNUM IMMEDIATE WITHOUT ANY EXCUSE AND HE FURTHER AGREED TO GIVE POSSESSION OF THE ABOVE SAID LAND IM MEDIATELY AFTER EXECUTION OF SALE DEED IN FAVOUR OF SECOND PARTY (P URCHASER) ON BASIS OF AS IS WHERE IS WHEREAS THE SECOND PARTY (PURCHASER) IS AGREED TO P AY THE REMAINING AMOUNT OF ` `21.00 LACS TO THE FIRST PARTY AT THE TIME OF EXECUTION OF THE SALE DEED BY DEMAND DRAFT BEFORE T HE SUB- REGISTRAR OF GOHAD DISTT. BHIND WHERE SALE DEED HAS TO BE REGISTERED AND EXECUTED. HE FURTHER AGREED THAT HE WILL ALWAYS READY TO GET EXECUTED THE SALE DEED ON HIS PART FAI LING WHICH THIS ITA N O.4258 /DEL./2010 6 AGREEMENT TO SALE WILL NOT BE IN FORCE AND THE AMOU NT OF AN ADVANCE WILL BE RETURNED BY FIRST PARTY TO SECOND P ARTY WITH DEDUCTION 25% OF AMOUNT OF ADVANCE. 5.1 NOW WHY THE ASSESSEE DID NOT ADHERE TO THE AFO RESAID TERMS AND CONDITIONS AND WHY THE AMOUNT OF ADVANCE OF ` 4 LACS WAS NOT REFUNDED TO THE BUYER EVEN WHEN SALE DEED WAS NOT EXECUTED WITHIN A PERIOD OF THREE MONTHS, HAS NOT BEEN EXPLAINED BEFORE US. EVEN WHEN THE AFORESAID CLAUSE S WERE BROUGHT TO THE NOTICE OF THE LD. AR, HE DID NOT REPLY NOR BROUGHT TO OUR NOTICE ANY EVIDENCE AS TO WHEN THE POSSESSION WAS ACTUALLY HANDED OVER TO THE BUYE R NOR ADDUCED ANY REASONS AS TO NON-ADHERENCE TO THE AFORESAID TERMS AND COND ITIONS OF THE AGREEMENT TO SELL DATED 8.1.2007. IN ANY CASE, SALE DEED WAS EX ECUTED ON 14 TH AUGUST, 2007 WITH M/S KASHISH RUBBER PVT. LTD. AND THE RELEVANT CLAUSES IN RESPECT OF POSSESSION OF THE SAID PROPERTY, READ AS UNDER: 3. THAT VENDEE SHALL HEREAFTER BE ENTITLED TO THE EXCLUSIVE OWNERSHIP AND POSSESSION OF THE SOLD PROPERTY AND SHALL BE ENTITL ED TO ALL TRANSFERABLE AND HERITABLE RIGHTS IN IT. THE VENDEE SHALL FURTHER B E FULLY ENTITLED TO SALE, MORTGAGE, LEASE, FITS, EXCHANGE OR IN ANY MANNER AL IENATE THE SOLD PROPERTY. 5. THAT THE VENDOR DOTH HEREBY ASSURES AND COVENAN TS WITH THE VENDEE THAT THE VENDEE SHALL HENCEFORTH QUIETLY AND PEACEFULLY POSSESS, OCCUPY AND ENJOY THE SOLD PROPERTY WITHOUT AND DENI AL, DEMAND, INTERRUPTION OR TROUBLE OF ANY KIND WHATSOEVER BY T HE VENDOR OR ANY PERSON LAWFULLY AND EQUITABLE CLAIMING UNDER THE VENDOR. 5.2 IT IS STATED IN THE AFORESAID SALE DEED THAT THE REMAINING AMOUNT OF ` 21 LACS WAS PAID ONLY AT THE TIME OF EXECUTION OF THE SAID SALE DEED. AS ALREADY STATED, NEITHER THE LD. CIT(A) IN THE IMPUGNED ORDE R NOR THE ASSESSEE BEFORE THE LD. CIT(A) AND EVEN BEFORE US ADVERTED TO THE AFORE SAID CLAUSES IN THE AGREEMENT TO SELL AND SALE DEED AND NOR EVEN THE ASSESSEE RE FERRED US TO ANY EVIDENCE REGARDING THE HANDING OVER OF POSSESSION TO THE BUY ER. IN ORDER TO BRING THE CAPITAL ASSET WITHIN THE FOUR CORNERS OF THE PROVIS IONS OF SECTION 45 OF THE ACT, ONE HAS TO DETERMINE WHETHER IN THE RELEVANT YEAR, THE RE WAS A TRANSFER OF A CAPITAL ASSET. HERE WE MAY POINT OUT THAT THE PROVISIONS OF SECTION 53A OF THE TRANSFER OF ITA N O.4258 /DEL./2010 7 PROPERTY ACT, 1882, WHICH WAS ADDED IN THE STATUTE BOOK BY THE TRANSFER OF PROPERTY (AMENDMENT) ACT, 20 OF 1929, WAS ANALYSED BY THE HONBLE APEX COURT IN THE CASE OF NATHULAL V. PHOOLCHAND, AIR 1970 SC 546, WHEREIN IT WAS HELD THAT (PAGE 548) : 'THE CONDITIONS NECESSARY FOR MAKING OUT THE DEFENC E OF PART PERFORMANCE TO AN ACTION IN EJECTMENT BY OWNER ARE : I. THAT THE TRANSFEROR HAS CONTRACTED TO TRANSFE R FOR CONSIDERATION ANY IMMOVABLE PROPERTY BY WRITING SIGNED BY HIM OR ON H IS BEHALF FROM WHICH THE TERMS NECESSARY TO CONSTITUTE THE TRANSFER CAN BE ASCERTAINED WITH REASONABLE CERTAINTY ; II. THAT THE TRANSFEREE HAS, IN PART PERFORMANCE OF THE CONTRACT, TAKEN POSSESSION OF THE PROPERTY OR ANY PART THEREOF OR THE TRANSFER EE BEING ALREADY IN POSSESSION CONTINUES IN POSSESSION IN PART PERFORMANCE OF THE CONTRACT ; III. . THAT THE TRANSFEREE HAS DONE SOME ACT IN FU RTHERANCE OF THE CONTRACT ; AND IV.. THAT THE TRANSFEREE HAS PERFORMED OR IS WILLIN G TO PERFORM HIS PART OF THE CONTRACT. IF THESE, CONDITIONS ARE FULFILLED, THEN NOTWITHSTA NDING THAT THE CONTRACT, THOUGH REQUIRED TO BE REGISTERED, HAS NOT BEEN REGISTERED OR WHERE THERE IS AN INSTRUMENT OF TRANSFER, THAT THE TRANSFER HAS NOT BEEN COMPLETED IN THE MANNER PRESCRIBED THEREFOR BY THE LAW FOR THE TIME BEING IN FORCE, THE TRANSFEROR OR ANY PERSON CLAIMING UNDER HIM IS DEBARRED FROM ENFORCI NG AGAINST THE TRANSFEREE ANY RIGHT IN RESPECT OF THE PROPERTY OF WHICH THE TRAN SFEREE HAS BEEN TAKEN OR CONTINUED IN POSSESSION OTHER THAN A RIGHT EXPRESS LY PROVIDED BY THE TERMS OF THE CONTRACT.' 5.3. SECTION 53A DOES NOT PROVIDE THAT UNDER TH E CIRCUMSTANCES STATED THEREIN, A GOOD TITLE PASSES TO THE TRANSFEREE. IT ONLY PRO VIDES THAT THE TRANSFEROR SHALL BE DEBARRED FROM ENFORCING AGAINST THE TRANSFEREE AND THE PERSON CLAIMING UNDER HIM, ANY RIGHT IN RESPECT OF THE IMMOVABLE PROPERTY OF WHICH THE TRANSFEREE HAS TAKEN POSSESSION. IN ADDITION TO A VALID TITLE, SEC TION 53A RECOGNIZES AN EQUITABLE INTEREST WHICH MIGHT ACCRUE TO THE TRANSFEREE IN TH E PROPERTY ON THE FULFILMENT OF THE CONDITIONS MENTIONED THEREIN. UNDER THE INCOME -TAX ACT, THE RECOGNITION OF ITA N O.4258 /DEL./2010 8 CONVEYANCE OF DE FACTO OWNERSHIP BY WAY OF HANDING OVER OF POSSESSION OF THE PROPERTY AS PER CONTRACT AND PART PERFORMANCE BY T HE TRANSFEREE WITHOUT ACTUAL CONVEYANCE OF TITLE, WAS FIRST TIME MADE BY THE FI NANCE ACT, 1987, BY AMENDING THE DEFINITION OF SECTION 2(47)(V) OF THE ACT. 6. IN THE INSTANT CASE, THE AGREEMENT TO SELL WAS ENTERED IN TO ON 8.1.2007 WHILE THE SALE DEED WAS EXECUTED ON 14.8.2007 AND R EGISTERED. THERE IS NOT EVEN A WHISPER IN THE ASSESSMENT ORDER REGARDING HA NDING OVER OF THE POSSESSION WHILE THE LD. CIT(A),WITHOUT EVEN REFERR ING TO VARIOUS TERMS AND CONDITIONS IN THE AGREEMENT TO SELL OR SALE DEED ,A CCEPTED THE SUBMISSIONS OF THE ASSESSEE THAT POSSESSION WAS HANDED OVER ON 8.1.200 7 ITSELF. HOWEVER, THE AFORESAID CLAUSES CULLED OUT BY US SPEAK OTHERWISE AND THE LD. AR APPEARING BEFORE US DID NOT REFER US TO ANY EVIDENCE REGARDIN G HANDING OVER POSSESSION. IN THESE CIRCUMSTANCES, ESPECIALLY WHEN THE ASSESSEE IN HIS GROUNDS OF APPEAL BEFORE US CONTENDED THAT THE LD. CIT(A) DID NOT ADJ UDICATE THEIR GROUND NOS. 1,3 & 4 RAISED BEFORE HIM WHILE THE LD. CIT(A) DID NOT AL LOW ANY OPPORTUNITY TO THE AO NOR SEEMS TO HAVE UNDERTAKEN ANY INDEPENDENT EXERCI SE IN ORDER TO VERIFY THE CONTENTION OF THE ASSESSEE THAT POSSESSION WAS HAND ED OVER ON 8.1.2007 AND NOR EVEN ADVERTED TO VARIOUS TERMS AND CONDITIONS I N THE AGREEMENT TO SELL AND SALE DEED , WE CONSIDER IT FAIR AND APPROPRIATE VAC ATE THE FINDINGS OF THE LD. CIT(A) AND RESTORE THE ISSUES RAISED IN VARIOUS GRO UND NOS. 1 TO 4 IN THE APPEAL BEFORE US TO HIS FILE, WITH THE DIRECTIONS TO READJ UDICATE THE ISSUES IN THE LIGHT OF OUR AFORESAID OBSERVATIONS IN ACCORDANCE WITH LAW A FTER ALLOWING SUFFICIENT OPPORTUNITY TO BOTH THE PARTIES, BRINGING OUT CLEAR LY AS TO WHEN THE POSSESSION OF AFORESAID IMMOVABLE PROPERTY WAS ACTUALLY ALLOWED T O THE BUYER IN THE LIGHT OF AFORESAID TERMS AND CONDITIONS MENTIONED THE AGREEM ENT TO SELL DATED 8.1.2007 ENTERED IN TO WITH SHRI SANJEEV MEHNDIRATTA AND SAL E DEED EXECUTED ON 14.8.2007 WITH M/S KASHISH RUBBER PVT. LTD.. WITH THESE DIRE CTIONS, GROUND NOS. 1 TO 4 IN THE APPEAL ARE DISPOSED OF, AS INDICATED HEREINBEF ORE. 7. NO ADDITIONAL GROUND HAVING BEEN RAISED BEFORE US IN TERMS OF RESIDUARY GROUND NO.5 IN THE APPEAL, ACCORDINGLY, THIS GROUND IS DISMISSED. ITA N O.4258 /DEL./2010 9 8. NO OTHER SUBMISSION OR ARGUMENT WAS MADE BEFO RE US. 9. IN THE RESULT, APPEAL IS ALLOWED BUT FOR STATI STICAL PURPOSES. SD/- SD/- (U.B.S. BEDI) (A.N. PAHUJA) JUDICIAL MEMBER ACCOUNTANT MEMBER COPY OF THE ORDER FORWARDED TO :- 1. INCOME TAX OFFICER, WARD 14(3), NEW DELHI. 2. M/S PRASANG STEEL LTD.,14, GIAN PARK, DELHI- 51 3. CIT(A)-XVII, NEW DELHI. 4. CIT CONCERNED. 5. DR, ITAT,F BENCH, NEW DELHI 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, DELHI ORDER PRONOUNCED IN OPEN COURT