M/s. Mohan Lal Sharma, Pathankot V. The Income-tax Officer, Pathankot

ITA 475/ASR/2012

• Counselvise Citation: 47520914 RSA 2012
• Duration Of Justice: 7 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-08-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 02-08-2013
• Assessment Year: 2007-2008
• Appeal Filed On: 26-12-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: SSH PREM SINGH; GUNJIT SYALI TP
• Keywords: Reopening of assessment; Capital asset; Depreciation; Opportunity of being heard; Principle of natural justice; Additional evidence; Advance ruling; Cost of acquisition; Difference of opinion; Deemed dividend; Competent authority; Revocable transfer; Revised return; Reason to believe; Unabsorbed depreciation; Change of opinion
• Section: 44AD; 143(3); 244A; 54F; 2(14); 234B; 147; 148; 54; 144; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AMRITSAR BENCH; AMRITSAR. BEFORE SH. H.S. SIDHU, JUDICIAL MEMBER AND SH. B.P.JAIN, ACCOUNTANT MEMBER I.T.A. NO. 180(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN :AJZPK0892Q SHRI SATNAM SINGH KAINTH VS. INCOME TAX OFFICER, EX-MP, VILL.SOTRAN P.O. CHAK NAWANSHAHAR. KALAN, DISTT. SBS NAGAR. (APPELLANT) (RESPONDENT) APPELLANT BY:S/SH.PREM SINGH ADV & GUNJIT SYAL,I TP RESPONDENT BY:SH.MAHAVIR SINGH, DR I.T.A. NO.475(ASR)/2012 ASSESSMENT YEAR:2007-08 PAN: AAHPL0148F SH. MOHAN LAL SHARMA, VS. INCOME TAX OFFICER, PATHANKOT. WARD-6(2), PATHANKOT. (APPELLANT) (RESPONDENT) I.T.A. NO.564(ASR)/2011 ASSESSMENT YEAR:2007-08 PAN: AFYPP7809M SH. SARWAN SINGH PHILLAUR, VS. INCOME TAX OFFICER, JALAHNDHAR.. WARD-III(2), JALANDHAR. (APPELLANT) (RESPONDENT) APPELLANT BY:SH.J.S.BHASIN, ADV. RESPONDENT BY: SH. MAHAVIR SINGH, DR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 2 I.T.A. NO.472(ASR)/2011 ASSESSMENT YEAR:2007-08 PAN: ABSPS4806K SH. KANWALJIT SINGH LALLY, VS. INCOME TAX OFFICER, VPO KOTLITHAN, JALANDHAR WARD-IV(2), JALANDHAR. (APPELLANT) (RESPONDENT) APPELLANT BY:NONE RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.13(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: AIFPP5367A SH. RAGHUNATH PURI (DECD) VS. DY.COMMR. OF INCOME TAX, THROUGH L/H SH.NARESH PURI, CIRCLE, PATHANKOT. PATHANKOT. (APPELLANT) (RESPONDENT) I.T.A. NO.187(ASR)/2012 ASSESSMENT YEAR:2007-08 PAN: BMCPK7557H SMT. RAJWINDER KAUR BHULLAR, VS. JT. COMMR. OF INC OME TAX, L/H OF LATE SH. GURDIP SINGH BHULLAR, PHAGWARA CIRC LE, P.O.BILGA, VILL. BHULLAR, PHAGWARA. DISTT. JALANDHAR. (APPELLANT) (RESPONDENT) APPELLANT BY:SH.J.S.BHASIN, ADV. RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.480(ASR)/2012 ASSESSMENT YEAR:2007-08 PAN: AAUPB5573H SH.RANJIT SINGH BRAHAMPURA, VS. ASSTT. COMMR. OF I NCOME TAX, AMRITSAR. CIRCLE-3, AMRITSAR. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 3 (APPELLANT) (RESPONDENT) APPELLANT BY:SH.PADAM BAHL,CA RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.08(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: ABPPS9812N SH. JAGDISH SAWHNEY, VS. ASSTT. COMMR. OF INCOME TAX, BATALA. CIRCLE-2, AMRITSAR. (APPELLANT) (RESPONDENT) I.T.A. NO.466(ASR)/2012 ASSESSMENT YEAR:2007-08 PAN: ABPPS9812N SH.JAGDISH SAWHNEY, VS. ASSTT. COMMR. OF INCOME T AX, BATALA.. CIRCLE-II, AMRITSAR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH.VINAMAR GUPTA, CA RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.63(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: APUPS5712C SH. SATYA PAL SAINI, VS. DY.. COMMR. OF INCOME T AX, EX-MLA, PATHANKOT. CIRCLE-3, AMRITSAR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH.PREM NATH ARORA, ADV RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.33(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: AAUPA6236E DR.RATTAN SINGH, M.P. VS. INCOME TAX OFFICER, ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 4 VILL. AJNALA, AMRITSAR. WARD 5(4),, AMRITSAR. (APPELLANT) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.34(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: AAJPC5918J DR.BALDEV RAJ CHAWLA, VS. ASSTT. COMMR. OF INCOME TAX, AMRITSAR. CIRCLE-1, AMRITSAR. (APPELLANT) (RESPONDENT) I.T.A. NO.162(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: ABPPS3902D SH.TIKSHAN SUD, VS. ASSTT. COMMR. OF INCOME TAX, HOSHIARPUR. HOSHIARPUR CIRCLE, HOSHIARPUR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH.K.R.JAIN,ADV RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.277(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: ABOPK0167F SH.AJIT SINGH KHOKHAR, VS. ASSTT. COMMR. OF INCOM E TAX, SHAHSKOT, JALANDHAR. (OSD) PHAGWARA CIRCLE. (APPELLANT) (RESPONDENT) APPELLANT BY: SH.J.S.BHASIN, ADV RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.338(ASR)/2013 ASSESSMENT YEAR:2008-08 PAN: ABIPD8959N ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 5 SH.BALWINDER SINGH DHILLON, VS. DY. COMMR. OF INCO ME TAX, FEROZEPUR. CIRCLE-3, FEROZEPUR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH.ANUPAM GUPTA, ADV RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.244(ASR)/2011 ASSESSMENT YEAR:2007-08 PAN: ACQPC5590B SH. BALBIR SINGH MIANI , VS. DY. COMMR. OF INCOME TAX, VPO LAKHINDER VIA DASUYA,HOSHIARPUR. JALANDHAR. (APPELLANT) (RESPONDENT) APPELLANT BY: SH.RAVISH SOOD,ADV RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.485(ASR)/2012 ASSESSMENT YEAR:2007-08 PAN: AYWPS6102M SH.VIR SINGH LOPOKE, VS. THE INCOME TAX OFFICER, VPO LOPOKE, TEH. AJNALA, WARD 5(4), AMRITSAR. AMRITSAR. (APPELLANT) (RESPONDENT) I.T.A. NO.37(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: AYWPS6102M INCOME TAX OFFICER, VS. SH.VIR SINGH LOPOKE, WARD 5(4), AMRITSAR. VILL. LOPOKE, AMRITSAR. (APPELLANT) (RESPONDENT) I.T.A. NO.15(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: AQMPS9598R ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 6 S.SEWA SINGH SEKHWAN, VS. INCOME TAX OFFICER, GURU RAM DASS COLONY, WARD 2(4), BATALA. BATALA. (APPELLANT) (RESPONDENT) I.T.A. NO.51(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: AGJPS3579B SH.AJIT PAL SINGH, INCOME TAX OFFICER, AMRITSAR. WARD-4(1), AMRITSAR. (APPELLANT) (RESPONDENT) I.T.A. NO.52(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: ABBPS8066K SH.SIMRANJIT SINGH VS. INCOME TAX OFFICER, L/H SMT. HARJIT KAUR, WARD 4(1), AMRITSAR. AMRITSAR. (APPELLANT) (RESPONDENT) I.T.A. NO.56(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: ADLPK3539L SMT. SATINDER KAUR VS. INCOME TAX OFFICER, L/H SMT. HARJIT KAUR, WARD 4(1), AMRITSAR. AMRITSAR. (APPELLANT) APPELLANT BY: SH.PADAM BAHL, CA RESPONDENT BY: SH. MAHAVIR SINGH, DR I.T.A. NO.58(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: AIQPB1994G ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 7 CAPT.BALBIR SINGH BATH, VS. ASSTT. COMMR. OF INCO ME TAX, BATALA. CIRCLE-II, AMRITSAR. (APPELLANT) (RESPONDENT) APPELLANT BY: NONE RESPONDENT BY: SH. MAHAVIR SINGH, DR DATE OF HEARING: 02/08/2013 DATE OF PRONOUNCEMENT:19/08/2013 I.T.A. NO.186(ASR)/2013 ASSESSMENT YEAR:2007-08 PAN: ABBPC8359A SH. SWARAN RAM CHAUDHARY, VS. JOINT. COMMR. OF INC OME TAX, PHAGWARA. PHAGWARA. (APPELLANT) (RESPONDENT) APPELLANT BY:SH.J.S.BHASIN, ADV RESPONDENT BY:SH.MAHAVIR SINGH, DR DATE OF HEARING: 06/08/2013 DATE OF PRONOUNCEMENT:19/08/2013 ORDER PER BENCH ; THESE 24 APPEALS OF DIFFERENT ASSESSEES AND TH E REVENUE ARISE FROM THE DIFFERENT ORDERS OF THE CIT(A), AS PER DET AILS BELOW: S.NO. I.T.A.NO. A.Y. NAME OF THE PARTY CIT (A) DATE OF ORDER 1. 180(ASR)/2013 2007-08 SH.SATNAM SINGH KAINTH JALANDHAR 01.01.2013 2. 475(ASR)/2012 -DO- SH.MOHAN LAL SHARMA AMRITSAR 08.11.2012 ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 8 3. 564(ASR)/2011 -DO- SH.SARWAN SINGH PHILLAUR JALANDHAR 28.9.2011 4. 472(ASR)/2011 -DO- SH.KANWALJIT SINGH LILLY JALANDHAR 17.6.2011 5. 13(ASR)/2013 -DO- SH.RAGHUNATH SAHAI AMRITSAR 8.11.2012 6. 187(ASR)/2013 -DO- SMT. RAJWINDER KAURR BHULLAR JALANDHAR 01.01.2013 7. 480(ASR)/2012 -DO- SH.RANJIT SINGH BRAHAMPURA AMRITSAR 5.11.2012 8. 08(ASR)/2013 -DO- SH.JAGDISH SAWHNEY AMRITSAR 29.10.2012 9. 466(ASR)/2012 -DO- SH.JAGDISH SAWHNEY AMRITSAR -DO- 10. 63(ASR)/2013 -DO- SATYA PAL SAINI AMRITSAR 30.11.2012 11. 33(ASR)/2013 -DO- DR.RATTAN SINGH AMRITSAR 08.11.2012 12. 34(ASR)/2013 -DO- DR.BALDEV RAJ CHAWLA AMRITSAR 01.11.2012 13. 162(ASR)/2013 -DO- SH.TIKSHAN SOOD, JALANDHAR 01.01.2013 14. 277(ASR)/2013 -DO- SH.AJIT SINGH KHOKHAR JALANDHAR 01.01.2013 15. 338(ASR)/2013 2008-09 SH.BALWINDER SIONGH BATHINDA 07.03.2013 16. 244(ASR0/2013 2007-08 SH.BALBIR SINGH MIANI JALANDHAR 29.03.2011 17. 485(ASR)/2012 -DO- SH.VIR SINGH LOPOKE AMRITSAR 02.11.2012 18. 37(ASR)/2013 -DO- REVENUE AMRITSAR -DO- 19. 15(ASR)/2013 -DO- SH.SEWA SINGH SEKHWAN AMRITSAR 06.11.2012 ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 9 20. 51(ASR)/2013 -DO- SH.AJIT PAL SINGH AMRITSAR 21.11.2012 21. 52(ASR)/2013 -DO- SH.SIMRANJIT SINGH AMRITSAR -DO- 22. 56(ASR)/2013 -DO- SMT. SATINDER KAUR JALANDHAR 30.11.2012 23. 58(ASR)/2013 -DO- CAPT. BALBIR SINGH BATH BATALA 29.11.2012 24. 186(ASR)/2013 -DO- SH.SWARAN RAM CHAUDHARY JALANDHAR 01.01.2013 2. IN I.T.A. NO. 180(ASR)/2013 THE ASSESSEE HAS RA ISED FOLLOWING GROUNDS OF APPEAL : 1. THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ORD ER U/S 143(3) READ WITH SECTION 147 DATED 26.11.2011 OF THE ACT. 2. THAT THE AUTHORITY BELOW HAS WRONGLY SUSTAINED THE RE-OPENING OF ASSESSMENT U/S 147 OF THE INCOME TAX ACT. 3. THAT THE ACTION OF THE ASSESSING OFFICER TO COVER T HE TRANSACTIONS DETAILED IN L.D.A. AS TRANSFER WITHIN THE MEANING OF SECTION 2(47) OF THE INCOME TAX ACT, 1961 WITHOUT APPRECIATING THE V ARIOUS CLAUSES OF THE AGREEMENT IN ARBITRARY, ILLEGAL AND UNJUSTIFIED . 4. THAT THE AUTHORITY BELOW HAVE WRONGLY ADOPTED FULL VALUE OF CONSIDERATION AT RS. 3,67,50,000/-. 5. THAT THE AUTHORITY BELOW HAVE FAILED TO TAKE INTO A CCOUNT AMENDED PROVISIONS OF REGISTRATION AND OTHER RELATED LAWS ( AMENDMENT) ACT 2001 WHILE APPLYING CLAUSE OF SEC. 2(47) OF THE INC OME TAX ACT. 6. THAT THE AUTHORITY BELOW HAS WRONGLY CONFIRMED THE CAPITAL GAIN U/S 45 OF THE I.T. ACT, 1961 AT RS. 3,54,68,276/-. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 10 7. THAT THE WRITTEN SUBMISSIONS/EXPLANATIONS HAS NOT B EEN CONSIDERED IN PROPER CONTEXT. 8. THAT THE ORDER IS AGAINST LAW AND FACTS OF THE CASE . 9. THAT THE CD. A.O. HAS INCURRED HIS JURISDICTION IN INITIATION PENALTY PROCEEDING U/S 271 (1)(C). 10. THAT PROPER OPPORTUNITY SHOULD HAVE BEEN ALLOWED. 11. ANY OTHER GROUND PRESSED AT THE TIME OF HEARING. 3. IN I.T.A. NO. 475-ASR-2012 THE ASSESSEE HAS RAI SED FOLLOWING GROUNDS OF APPEAL: 1. . THAT THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIA(A) HAS GROSSLY ERRED IN UPHOLDING THE ASSUMPTI ON OF JURISDICTION BY A.O. UNDER SECTION 147. 2. THAT SANS A SPEAKING ORDER OF A.O. DISPOSING OF THE LEGAL OBJECTIONS TAKEN BY THE ASSESSEE AGAINST REOPENING OF CASE UNDER SECTION 147, THE IMPUGNED ORDER OUGHT TO HAVE BEEN HELD AS BAD IN LAW. 3. THAT ORDER OF THE LEARNED CIT(A), OSTENSIBLY BE ING A MOST MECHANICAL BORROWAL OF FACTS AND FINDINGS OF SOME OTHER CASE, DESERVES TO BE SET ASIDE ON THIS VERY PREMISE. 4. THAT IN THE GIVEN FACTS AND CIRCUMSTANCES OF TH E CASE, THE LEARNED CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THAT CAPITAL GAIN OF RS. 1,77,35,810.00 WAS LIABLE TO TAX IN THE YEAR UNDER APPEAL, ON A TOTALLY ERRONEOUS AND INCORRECT READING OF THE JOINT DEVEL OPMENT AGREEMENT QUA THE PROVISIONS OF SECTION 2(47) OF THE INCOME TAX ACT, 1961. 5. THAT THE RELIANCE PLACED BY LEARNED CIT(A) ON V ARIOUS JUDICIAL AUTHORITIES, TO UPHOLD THE IMPUGNED ADDITION ON AC COUNT OF CAPITAL GAIN, IS NOT ONLY MISPLACED BUT ALSO ILLEGAL AND A RBITRARY, WHEN NO SUCH AUTHORITY WAS CONFRONTED TO ASSESSEE FOR REBUTTAL. 6. THAT THE ASSESSEES CLAIM OF DEDUCTION UNDER SE CTION 54F OUGHT TO HAVE BEEN ALLOWED BY THE LEARNED CIT(A). ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 11 7. THAT THE LEARNED CIT(A) OUGHT TO HAVE CONSIDERE D AND ALLOWED THE ASSESSEES CLAIM THAT THE IMPUGNED CAPITAL GAI N, IF ANY COULD BE ASSESSED ONLY IN THE HAND OF THE SOCIETY AND NOT T HE ASSESSEE MEMBER. 8. THAT CHARGING OF INTEREST UNDER SECTIONS 234A & 234B HAS BEEN WRONGLY CONFIRMED. 9. THAT INITIATION OF PENALTY UNDER SECTION 271(1) (A) HAS BEEN WRONGLY CONFIRMED. 10. THAT THE ORDER UNDER APPEAL IS WHOLLY AGAINST LAW AND FACTS OF THE CASE. 4. IN I.T.A. NO. 564-ASR-2013 THE ASSESSEE HAS RAIS ED FOLLOWING GROUNDS OF APPEAL : 1. THAT THE LEARNED COMMISSIONER OF INCOME-TAX(AP PEALS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN COMPLETING THE ASSESSMENT U NDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (THE ACT) AT AN INCO ME OF RS. 18533450/- AS AGAINST INCOME OF RS. 158450/- RETUR NED BY THE APPELLANT. 2. THAT THE LEARNED COMMISSIONER OF INCOME-TAX (AP PEALS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN MAKING AN ADDITION OF LONG TERM CAPITAL GAIN OF RS. 18375000- UNDER SECTION 45 OF THE ACT ON ACCOU NT OF ALLEGED TRANSFER OF PROPERTY. 2.1 THAT THE LEARNED COMMISSIONER OF INCOME-TAX(A PPEALS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN ALLEGING THAT THERE W AS DEEMED TRANSFER OF PROPERTY ON THE DATE OF SIGNING OF TRIPARTITE JOIN T DEVELOPMENT AGREEMENT (THE AGREEMENT) ITSELF, IN TERMS OF SU B-SECTIONS (II), (V) AND (VI) SECTION 2(47) OF THE ACT. 2.2 THAT THE LEARNED COMMISSIONER OF INCOME-TAX ( APPEALS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THAT THE TRANSFER OF THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 12 PROPERTY IS DEPENDENT ON THE RECEIPT OF CONSIDERAT ION AND REGISTRATION OF THE PROPERTY. 2.3 THAT THE LEARNED COMMISSIONER OF INCOME-TAX(A PPEALS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THAT ACTUAL PHYSICAL POSSESSING OF THE PROPERTY WAS NOT HANDED OVER OF PART PERFORMANCE OF THE CONTRACT, IN TERMS OF SECTION 53A OF THE TRANS FER OF PROPERTY ACT. 2.4 THAT THE LEARNED COMMISSIONER OF INCOME-TAX(A PPEALS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THAT AMOUNT OF RS. 30 LACS RECEIVED UNDER THE AGREEMENT, WERE IN THE NAT URE OF ADVANCE RECEIVED AND NOT THE ACTUAL SALES CONSIDERATION. 2.5 THAT LEARNED COMMISSIONER OF INCOME-TAX(APPEA LS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN ALLEGING THAT THE AFORESAID TRANSFER UNDER THE AGREEMENT WAS NOT SUBJECT TO ANY FURTHER CONDITION /ENCUMBRANCES. 2.6 WITHOUT PREJUDICE, LEARNED COMMISSIONER OF IN COME- TAX(APPEALS) HAS REJECTED THE CONTENTION OF THE AP PELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN NOT COMPUTING THE CAPITAL GAINS WITH RESPECT TO THE ACTUAL AMOUNT RE CEIVED DURING THE RELEVANT ASSESSMENT YEAR. 2.7 WITHOUT PREJUDICE, LEARNED COMMISSIONER OF IN COME- TAX(APPEALS) HAS REJECTED THE CONTENTION OF THE AP PELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN NOT ALLOWING EXEMPTION UNDER SECTION 54F OF THE ACT. 3. THAT THE LEARNED COMMISSIONER OF INCOME-TAX(AP PEALS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN NOT PROVIDING AN ADEQ UATE OPPORTUNITY OF BEING HEARD TO THE APPELLANT INASMUCH AS THE APPEL LANT WAS NOT ABLE TO PRODUCE ADDENDUMS TO THE AGREEMENT. 4. THAT THE LEARNED COMMISSIONER OF INCOME-TAX(AP PEALS) HAS REJECTED THE CONTENTION OF THE APPELLANT THAT THE ASSESSING OFFICER ERRED ON FACTS AND IN LAW IN CHARGING INTEREST UND ER SECTION 234B OF THE ACT AND WITHDRAWING INTEREST UNDER SECTION 244 A(3) OF THE ACT. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 13 5. THAT THE ORDER OF THE CIT(A) AS WELL AS THE A. O. IS AGAINST THE LAW AND THE FACTS OF CASE. 6. THAT THE LEARNED CIT(A) HAS NOT CONSIDERED THE VARIOUS JUDGMENTS IN THIS REGARD, AS HELD BY THE VARIOUS J UDICIAL AUTHORITIES. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR VARY THE ABOVE GROUNDS OF APPEAL AT OR BEFORE THE TIME OF HEARING. 5. IN I.T.A. NO. 472-ASR-2011 THE ASSESSEE HAS RAIS ED FOLLOWING GROUNDS OF APPEAL : 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) GRAVELY ERRED IN CONFIRMING THE ADDITION OF LONG T ERM CAPITAL GAIN OF RS. 1,77,65,846/- UNDER SECTION 45 OF THE ACT ON ACCOUNT OF ALLEGED TRANSFER OF LAND, WHICH WAS NEVER TRANSFERRED IN T HE NAME OF THE ASSESSEE NOR THE ASSESSEE TRANSFERRED THE SAME AS REQUIRED BY LAW. 2. THAT WHILE HOLDING AS ABOVE, THE LD. CIT(A) ERR ED ON FACTS AND IN LAW IN HOLDING THAT THERE WAS TRANSFER OF PROPE RTY ON THE DATE OF SIGHING OF THE TRIPARTITE JOINT DEVELOPMENT AGREEM ENT (THE AGREEMENT) ITSELF, IN TERMS OF SUB-SECTIONS (II), (V) AND (VI) OF SECTION 2(47) OF THE ACT TO WHICH THE ASSESSEE IS NOT A PA RTY. 2.1 THAT THE LD. CIT(A) ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THAT THE TRANSFER OF THE PROPERTY IS DEPENDENT ON THE RECEIPT OF CONSIDERATION AND REGISTRATION OF THE P ROPERTY BY THE ASSESSEE, WHICH PART IS MISSING IN THIS CASE. 2.2 THAT LD. CIT(A) ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THAT ACTUAL PHYSICAL POSSESSION OF TH E PROPERTY WAS NOT HANDED OVER EVEN IN PART PERFORMANCE OF THE CONTRA CT, IN TERMS OF SECTION 53A OF THE TRANSFER OF PROPERTY ACT BY THE ASSESSEE. 2.3 THAT THE LD. CIT(A) ERRED ON FACTS AND IN LAW IN NOT APPRECIATING THE AMOUNT OF RS. 15,00,000/- RECEIVE D UNDER THE AGREEMENT, WERE IN THE NATURE OF ADVANCE RECEIVED FROM SOCIETY AND NOT THE ACTUAL SALES CONSIDERATION. 2.4 THAT THE LD. CIT(A) ERRED ON FACTS AND IN LAW IN APPRECIATING THE FACTS THAT THE AFORESAID TRANSFER UNDER THE AGREEMENT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 14 WAS BY THE SOCIETY SUBJECT TO FURTHER CONDITION/EN CUMBRANCES AND NOT BY THE ASSESSEE. 2.5 THAT WITHOUT PREJUDICE TO THE ABOVE, THE LD. CIT(A) ERRED ON FACTS AND IN LAW IN NOT COMPUTING THE CAPITAL G AINS WITH RESPECT TO THE ACTUAL AMOUNT RECEIVED DURING THE RELEVANT ASS ESSMENT YEAR, THERE BEING NO TRANSFER OF ANY FLAT TO THE ASSESSEE WHIC H IS WRONGLY VALUED AND ADDED BY A.O. AT RA. 10125000/- FOR CAPITAL GA IN CALCULATION. 2.6 THAT WITHOUT PREJUDICE TO THE ABOVE, THE LD. CIT(A) ERRED ON FACTS AND IN LAW IN NOT ALLOWING EXEMPTION UNDE R SECTION 54F OF THE ACT IN RESPECT OF INVESTMENT MADE IN RESIDENTI AL HOUSE AS CLAIMED BY THE ASSESSEE. 3. THAT THE ASSESSING OFFICER ERRED IN FACTS AND IN LAW IN CHARGING INTEREST UNDER SECTION 234B OF THE ACT. 4. THAT THE APPELLANT BEGS TO ADD OR AMEND ANY GR OUND OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF . 6. IN I.T.A. NO. 13-ASR-2013 THE ASSESSEE HAS TAKEN FOLLOWING GROUNDS OF APPEAL : 1. THAT THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LEARNED CIA(A) HAS GROSSLY ERRED IN UPHOLDING THE VALIDITY OF IMPUGNED ORDER, WHEN ALL THE LEGAL HEIRS WERE ADMITTEDLY NOT IMPLE ADED BY ISSUING INDEPENDENT NOTICES U/S 148 TO EACH OF THE LEGAL H EIRS. 2. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) HAS GROSSLY ERRED IN UPHOLDING THE ASSUMPTION OF J URISDICTION BY THE A.O. UNDER SECTION 147. 2. THAT SANS A SPEAKING ORDER OF A.O. DISPOSING OF THE LEGAL OBJECTIONS TAKEN BY THE ASSESSEE AGAINST REOPENING OF CASE UNDER SECTION 147, THE IMPUGNED ORDER OUGHT TO HAVE BEEN HELD AS BAD IN LAW. 3. THAT ORDER OF THE LEARNED CIT(A), OSTENSIBLY BE ING A MOST MECHANICAL BORROWAL OF FACTS AND FINDINGS OF SOME OTHER CASE, DESERVES TO BE SET ASIDE ON THIS VERY PREMISE. 4. THAT IN THE GIVEN FACTS AND CIRCUMSTANCES OF TH E CASE, THE LEARNED CIT(A) WAS NOT JUSTIFIED IN UPHOLDING THAT CAPITAL GAIN OF RS. 1,77,35,810.00 WAS LIABLE TO TAX IN THE YEAR UNDER APPEAL, ON A TOTALLY ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 15 ERRONEOUS AND INCORRECT READING OF THE JOINT DEVEL OPMENT AGREEMENT QUA THE PROVISIONS OF SECTION 2(47) OF THE INCOME TAX ACT, 1961. 5. THAT THE RELIANCE PLACED BY LEARNED CIT(A) ON V ARIOUS JUDICIAL AUTHORITIES, TO UPHOLD THE IMPUGNED ADDITION ON AC COUNT OF CAPITAL GAIN, IS NOT ONLY MISPLACED BUT ALSO ILLEGAL AND A RBITRARY, WHEN NO SUCH AUTHORITY WAS CONFRONTED TO ASSESSEE FOR REBUTTAL. 6. THAT THE ASSESSEES CLAIM OF DEDUCTION UNDER SE CTION 54F OUGHT TO HAVE BEEN ALLOWED BY THE LEARNED CIT(A). 7. THAT THE LEARNED CIT(A) OUGHT TO HAVE CONSIDERE D AND ALLOWED THE ASSESSEES CLAIM THAT THE IMPUGNED CAPITAL GAI N, IF ANY, COULD BE ASSESSED ONLY IN THE HAND OF THE SOCIETY AND NOT T HE ASSESSEE MEMBER. 8. THAT CHARGING OF INTEREST UNDER SECTIONS 234A & 234B HAS BEEN WRONGLY CONFIRMED. 9. THAT INITIATION OF PENALTY UNDER SECTION 271(1) (C) HAS BEEN WRONGLY CONFIRMED. 10. THAT THE ORDER UNDER APPEAL IS WHOLLY AGAINST LAW AND FACTS OF THE CASE. 7. IN I.T.A. NO. 187-ASR-2013 THE ASSESSEE HAS RAI SED FOLLOWING GROUNDS OF APPEAL : 1. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. CIT(A) HAS GROSSLY ERRED IN UPHOLDING THE VALIDITY OF ASS UMPTION OF JURISDICTION U/S 147/148. 2. THAT THE LED. CIT(A) MISDIRECTED HIMSELF IN LAW AND ON FACTS IN CONFIRMING THE TAXATION OF NOTIONAL CAPITAL GAIN O F RS. 81,59,594/- BY WRONGLY UPHOLDING THE TRANSFER OF LAND ON THE DATE OF EXECUTION OF A JOINT DEVELOPMENT AGREEMENT WITH THE DEVELOPERS. 3. THAT THE LD. CIT(A) OUGHT TO HAVE READ THE JOIN T DEVELOPMENT AGREEMENT IN TOTALITY, SO AS NOT TO INFER THE ACCR UAL OF CAPITAL GAIN ON THE VERY DATE OF EXECUTION OF THE SAID AGREEMENT. 4. THAT THE LD. CIT(A) WAS NOT JUSTIFIED OVERLOOK ING VARIOUS JUDICIAL AUTHORITIES, RELIED UPON BY ASSESSEE, ON A FACIAL DISTINCTION DRAWN BY HIM. 5. THAT THE LD. CIT(A) WRONGLY REJECTED THE ASSESS EES CLAIM THAT THE IMPUGNED CAPITAL GAIN, IF ANY, COULD BE ASSESS ED ONLY IN THE HANDS OF SOCIETY AND NOT THE ASSESSEE MEMBER. 6 THAT THE ASSESSEES CLAIM NOT TO TAX THE IMPUGNE D GAIN ON THE PRINCIPLES OF MUTALITY INVOLVED IN THE TRANSACTION S, HAS BEEN WRONGLY REJECTED BY LD. CIT(A). ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 16 7. THAT CHARGING OF INTEREST OF U/S 234A, 234B, 23 4C, & 234D HAS BEEN WRONGLY CONFIRMED. 8. THAT THE INITIATION OF PENALTY U/S 271(1)(C) HA S BEEN WRONGLY CONFIRMED. 9. THAT THE ORDER UNDER APPEAL IS WHOLLY AGAINST L AW AND FACTS OF THE CASE. 8. IN I.T.A. NO. 480-ASR-2012 THE ASSESSE HAS TAKEN FOLLOWING GROUNDS OF APPEAL : 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ACTIO N OF THE ASSESSING OFFICER IN REOPENING THE CASE OF THE ASSESSEE U/S 148 OF INCOME TAX ACT, 1961, INASMUCH AS THERE WAS NO INDEPENDENT AP PLICATION OF MIND BY THE ASSESSING OFFICER AND THE CASE HAD BEEN OPE NED BY THE ASSESSING OFFICER ON THE DISTATES OF HIS SUPERIOR OFFICER. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS), AMRITSAR HAS FAILED TO APPRECIATE THAT THE REASONS RECORDED BY THE ASSESSING OFFICER MENTIONED ONLY ESCAPEMENT OF INC OME OF RS. 30 LACS WHEREAS THE ASSESSEE HAD OFFERED CAPITAL GAIN AT RS. 24 LACS IN HIS RETURN FOR A/YEAR 2007-08 AND THAT THE ASSESSI NG OFFICER DURING RE-ASSESSMENT PROCEEDINGS CHANGES HIS STANCE TO IN CREASE ESCAPEMENT OF INCOME AT RS. 165 LACS PLUS VALUATION OF 2 FLAT S OF 2250 SQ. FT. EACH WHILE DEALING WITH OBJECTIONS OF THE ASSESSEE . 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ADDIT ION OF RS. 3,36,68,666/- MADE BY THE ASSESSING OFFICER ON ACC OUNT OF ALLEGED CAPITAL GAINS. 4. THAT BOTH LEARNED COMMISSIONER OF INCOME TAX (A PPEALS), AMRITSAR AND THE LEARNED ASSESSING OFFICER HAVE FA ILED TO APPRECIATE THAT THE DEVELOPER HAD NOT PERFORMED AND WAS NOT W ILLING TO PERFORM HIS PART OF CONTRACT AND SEC. 53A OF TPA COULD NOT BE MADE APPLICABLE. 5. THAT BOTH COMMISSIONER OF INCOME TAX(APPEALS), AMRITSAR AND THE ASSESSING OFFICER HAVE FAILED TO APPRECIAT E THAT THE JDA STOOD ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 17 CANCELLED BY THE PUNJABI CO-OP HOUSING BUILDING SO CIETY HAD ON 11.05.2011 AND THE POA GRANTED BY THE SOCIETY TO D EVELOPER WAS ALSO CANCELLED ON 31.10.2011 DUE TO NOW PERFORMANCE OF CONTRACT BY DEVELOPER. 6. THAT BOTH LEARNED COMMISSIONER OF INCOME TAX (A PPEALS), AMRITSAR AND THE ASSESSING OFFICER FAILED TO APPRE CIATE THAT THE TERMINATION CLAUSE 14(IV) OF JDA TOOK AWAY THE JDA OUT OF THE SCOPE OF SEC. 2(47)(V) OF THE INCOME TAX ACT, 1961. 7. THAT BOTH LEARNED COMMISSIONER OF INCOME TAX (A PPEALS), AMRITSAR AND THE ASSESSING OFFICER FAILED TO APPRE CIATED THAT THE ASSESSEE WAS NOT THE OWNER OF THE PLOT AND THAT HE WAS MERELY A MEMBER/SHAREHOLDER OF THE SOCIETY AND JDA WAS MADE BY THE SOCIETY AND NOT BY THE ASSESSEE. 8. THAT THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ACTIO N OF THE ASSESSING OFFICER IN CALCULATING LONG TERM CAPITAL GAIN AT A N ESTIMATED RATE OF RS. 4,500/- PER SQ. FT. FOR THE FLAT OF 2250 SQ. F T. EACH AS PART OF FULL VALUE OF CONSIDERATION, THE BASIS OF WHICH WAS NEV ER CONFRONTED TO THE ASSESSEE. 9. THAT BOTH COMMISSIONER OF INCOME TAX(APPEALS), AMRITSAR AND THE ASSESSING OFFICER FAILED TO APPRECIATE THA T LONG TERM CAPITAL GAIN COULD BE CALCULATED ONLY ON PRO-RATA BASIS AS ONLY A PART OF THE LAND STOOD TRANSFERRED UNDER THE JDA. 9. IN ITA NO.08(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT LD. CIT(A) HAS ERRED IN FACTS AND LAW IN UPHOLDING THE ORDER OF AO U/S 143(3) MAKING AN ADDITION OF RS.3, 53,52,923/- BY WAY OF LONG TERM CAPITAL GAINS AND HENCE ADDITION TO CAPITAL GAINS SHOULD BE DELETED. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 18 1.1 THAT LD. CIT(A) HAS ERRED IN FACTS AND LAW IN UPHOL DING THE ORDER OF AO BY TREATING JUST ENTERING INTO DEVELOPM ENT AGREEMENT WITH DEVELOPER, AS TRANSFER HAVING REGA RD TO FACTS AND CIRCUMSTANCES OF THE CASE UNDER VARIOUS CLAUSES OF S. 2(47) INCLUDING 2(47)(II) AND/OR 2(47)(V) AND/OR 2(47)(VI ). 1.2 THAT LD. CIT(A) HAS ERRED IN FACTS AND LAW IN UPHOL DING THAT SECTION 53A OF TRANSFER OF PROPERTY ACT IS APPLICAB LE TO THE TRANSACTION. 1.3 THAT LD. CIT(A) HAS ERRED IN MAKING ADDITION BY WAY OF LONG TERM CAPITAL GAIN CONSIDERATION ITSELF IN NOT REAL AND UNASCERTAINABLE. 1.4 THAT LD. CIT(A) ERRED IN TAKING INTO COMPUTATION OF CAPITAL GAINS THE VALUE OF FLATS AT RS.4500/- PER SQUARE FE ET. 1.5 THAT THE LD. CIT(A) ERRED BY NOT TREATING RS.30 LAK HS AS ADVANCE FOR A.Y.2007-08 AND IGNORING THE AMOUNT OFF ERED FOR CAPITAL GAINS FOR A.Y.2008-09. 1.6 THAT THE LD. CIT(A) HAS ERRED IN UPHOLDING THAT DEV ELOPER HAS NOT COMMITTED ANY DEFAULT IN PAYMENT OF CONSIDERAT ION WHILE DEVELOPER HAS FAILED TO MAKE PAYMENTS AS STIPULATED IN THE AGREEMENT WHICH SPECIFICALLY PROVIDES THAT TIME IS THE ESSENCE IN THE PERFORMANCE OF THE PARTIES RESPECTIVE OBLIG ATIONS. 1.7 THAT LD. CIT(A) HAS ERRED IN UPHOLDING THAT APPELLA NT HAS NO RIGHT TO REVOKE POWER OF ATTORNEY IN SPITE OF THE F ACT THAT DEVELOPER HAS NOT PERFORMED ITS PART OF THE CONTRA CT FOR THE EXECUTION OF WHICH THE POWER OF ATTORNEY WAS BESTOW ED. 1.8 THAT LD. CIT(A) HAS ERRED IN FACTS AND LAW IN UPHOL DING THE ORDER OF AO ASSESSING THE CAPITAL GAINS IN THE HAND S OF ASSESSEE WHERE IN FACT AGREEMENT HAS BEEN CANCELLED BY PUNJA B COOPERATIVE HOUSE BUILDING SOCIETY. 1.9 THAT LD. CIT(A) ERRED IN HOLDING THAT CAPITAL GAIN IS ASSESSABLE IN THE HANDS OF APPELLANT WHILE THE LAND IS HELD IN REVENUE RECORDS IN THE NAME OF PUNJAB CO-OPERATIVE HOUSE BU ILDING ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 19 SOCIETY LIMITED, MOHALI REGISTERED UNDER PUNJAB CO- OPERATIVE SOCIETIES ACT, 1961. 1.10 THAT THE LD. CIT(A) ERRED IN NOT ALLOWING EXEMPTION U/S 54F. 2. THE LD. CIT(A) HAS ERRED IN DISALLOWING DEPRECIATIO N OF RS.46,444/-. 3. THAT THE LD. CIT(A) HAS ERRED IN APPLYING INTEREST UNDER SECTION 234A, 234B, 234C , 234D AND WITHDRAWING INTEREST U/ S 244A. 4. THAT LD. CIT(A) HAS PASSED THE ORDER WITHOUT GIVIN G REASONABLE OPPORTUNITY AND WITHOUT CONSIDERING THE COURT JUDGM ENTS LAID BEFORE HIM. 5. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEN D, SUBSTITUTRE OR VARY ALL OR ANY OF THE GROUNDS OF APPEAL HERE IN ABOVE AT OR BEFORE HEARING OF APPEAL. 10. IN ITA NO.466(ASR)/2012, THE ASSESSEE HAS RAISE D FOLLOWING GROUNDS OF APPEAL: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) HAS ERRED IN CONFIRMING AND UPHOLDING THE A DDITIONS OF RS.35352923/- MADE BY LD. ACIT,CC-II, AMRITSAR ON ACCOUNT OF LONG TERM CAPITAL GAIN WORKED OUT BY SUBSTRACTING THE RESULTANT YEAR WISE COST INFLATION INDEXED VALUE OF RS.13,97,077/ - FROM THE TOTAL TRANSFER CONSIDERATION OF RS.3,67,50,000/-. WHEREA S THERE WAS NO CAPITAL GAIN AS THE ASSESSEE THROUGH PUNJAB CO-OPE RATIVE HOUSING SOCIETY, MOHALI HAD ENTERED INTO AN AGREEMENT FOR DEVELOPMENT OF PROPERTY WHICH HAD BEEN TREATED AS AGREEMENT FOR S ALE AS HELD BY ASSESSING OFFICER AND WORTHY CIT(A). 2. THAT THE ORDER IS BAD IN LAW AND ON THE FACTS OF TH E CASE. 3. THAT THE APPELLANT PRAYS THAT THE ADDITION OF RS.35 352923/- ON ACCOUNT OF CAPITAL GAIN MAY KINDLY BE DELETED. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 20 11. IN ITA NO.63(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE ASSESSMENT ORDER AS WELL AS THE ORDER OF THE CIT(A) ARE BOTH AGAINST THE FACTS OF THE CASE AND UNTENABLE IN LAW. 2. THAT THE AO HAS GROSSLY ERRED IN MAKING THE ADDITIO N OF RS.3,41,91,676/- AS CAPITAL GAIN. FURTHERMORE, THE CIT(A) HAS ALSO GROSSLY ERRED IN CONFIRMING THE SAME WITHOUT A PPLYING HIS MIND AND AS SUCH THE ADDITION MADE MAY BE DELETED I N AS MUCHAS THERE IS NO CAPITAL GAIN ACCRUE TO THE ASSES SE DURING THE YEAR UNDER CONSIDERATION. 3. THAT THE AUTHORITIES BELOW DID NOT APPRECIATE THAT TILL NOW THE ASSESSEE HAS NOT RECEIVED ANYTHING MORE IN THIS ACC OUNT FOR THE SIMPLE REASON THAT THE MATTER IS SUBJUDICE BEFORE T HE P & H HIGH COURT AND THE ASSESSEE IS STILL NOT THE OWNER OF THE SAME. 4. THAT THE AO HAS GROSSLY ERRED IN DISALLOWING DEDUC TION OF RS.45 LACS PAID EXTRA TO SHRI VIJAY UMMAT FOR RESCI NDING THE SALE AGREEMENT TO WHOM ASSESSEE SOLD ONE HALF OF HI S PLOT, ON THE BASIS OF UNCORROBORATED STATEMENT WITHOUT CONFR ONTING THE ASSESSEE. SIMILARLY, THE LD. CIT(A) HAS GROSSLY ER RED IN CONFIRMING THE SAME. 5. THAT THE AO HAS GROSSLY ERRED IN NO APPRECIATING T HE FACT THAT ASSESSEE HAD SOLD ONE HALF SHARE OF HIS SHARE TO SH .MOHIT KUMAR GARG AND HARJINDER SINGH AND THE ADDITION OF ONE HALF OF THE ADDITION OF RS.1,61,18,658/- SHOULD NOT HAVE BEEN MADE IN THE HANDS OF THE ASSESSEE AS THE ONE HALF SHARE BELONGS TO SH.MOHIT KUMAR GARG AND SH. HARJINDER SINGH AND IF AT ALL, THE ADDITION SHOULD HAVE BEEN MADE IN THEIR HANDS. THE DEVELOPERS TATA HOUSING HAD ALSO PAID THE ADVANCE/EARNEST MONE Y TO SH. MOHIT GARG AND SH.HARJINDER SINGH DIRECTLY. 6. THAT THE AUTHORITIES BELOW DID NOT APPRECIATE THAT THE WRITTEN SUBMISSIONS WERE FURNISHED BEFORE THEM DURING THE C OURSE OF APPELLATE PROCEEDINGS AS WELL AS BEFORE THE AO ESPE CIALLY WHEN NO INCOME HAD ACCRUED AS THE DEVELOPER HAS NOT FULF ILLED MOST OF THE CONDITIONS OF THE AGREEMENT AND THE PROJECT IS MARRED BY CONTROVERSIES AND UNCERTAINTIES AND IS STILL INCOMP LETE. THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 21 AGREEMENT STANDS ANNULLED AS ON DATE. AS SUCH THE LONG TERM CAPITAL GAIN DETERMINED & ASSESSED BY THE AO IS WIT HOUT ANY RHYME & REASON. AS SUCH THE ADDITION OF RS.3,41,91, 676/- ON ACCOUNT OF LONG TERM CAPITAL GAIN IS NOT CALLED FOR AND THE SAME DESERVES TO BE DELETED FOR THE SIMPLE REASON T HAT THE CIT(A) DID NOT APPLY HIS MIND AND CONFIRMED THE SAM E WITHOUT CONSIDERING THE EXPLANATIONS SUBMITTED BY THE ASSES SEE. AS SUCH, THE ADDITION CONFIRMED BY THE CIT(A) IS PUREL Y BASED ON CONJECTURES, SURMISES AND SUPPOSITIONS AND THE SAME MAY BE DELETED. ALTERNATIVELY, THE ADDITION MADE IS VERY H IGH & EXCESSIVE. 7. ANY OTHER GROUND OF APPEAL THAT MAY BE URGED AT THE TIME OF HEARING OF THE APPEAL. 12. IN ITA NO.33(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN PASSING THE APPELLATE ORDER. 2. THAT THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ADDITION OF RS.17721000 UNDER THE HEAD CAPITA L GAIN. 3. THAT THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN CONFIRMING THE ORDER OF THE A.O. U/S 144 OF THE ACT BECAUSE THERE IS PROPER COMPLIANCE TO THE NOTICES ISSUED BY THE A.O. U/S 148 AND 142(1)/143(2) WHICH THE AO HAS HIMSELF MENTIONED IN THE ASSESSMENT ORDER PASSED U/S 144 ON PAGE OF THE SA ID ORDER. 4. THAT THE LD. CIT(A) HAS ERRED IN ACCEPTING THE ORDER PASSED BY THE AO U/S 144 AS CORRECT BECAUSE THE ASSESSMENT IS PASSED UNDER WRONG SECTION IN THE TRUE FACTS OF CASE. SO THE ASSESSMENT ORDER PASSED BY THE A.O. IS WRONG ALENITIO AND D ESERVE CANCELLATION INSTEAD OF CONFIRMATION AS THE ASSES SEE HAS SHOWN THE SALE MONEY RECEIVED IN THE ORIGINAL RETURN AN D THUS NOTICE U/S 148 OF THE INCOME TAX ACT WAS INVALID. 5. THAT THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN NOT ACCEPTING THE INVESTMENT OF RS.3300000 RECEIVED AGAINST T HE PLOT IS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 22 INVESTED IN THE CONSTRUCTION OF RESIDENTIAL HOUS E AT RANJIT AVENUE AMRITSAR AND THUS NO CAPITAL GAIN IS LEVIA BLE ON RS.3300000/-. 6. THAT THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN NOT ACCEPTING THE SUBMISSIONS THAT THE SOCIETY ON RECEIPT OF TW O INSTALMENTS AS PER PARA 4-I(I) OF THE AGREEMENT DEED EXECUTED TH E REGISTERED DEEDS OF LAND MEASURING 3.08 ACRES AND 4.62 ACRES ONLY IN PROPORTION OF THE PAYMENTS RECEIVED. THUS, THE SO CIETY DID NOT HAND OVER THE POSSESSION OF WHOLE OF THE LAND MEA SURING 21.2 ACRES. THUS, CAPITAL GAIN IS LEVIABLE ON THE SHAR E OF LAND FOR WHICH POSSESSION HAS BEEN GIVEN. THE ASSESSEE REC EIVED RS.3300000 AS HIS SHARE WHICH HE INVESTED IN THE CONSTRUCTION OF RESIDENTIAL HOUSE WHICH CLEAR FROM THE BALANCE SHEET FILED. 7 THAT THE RIGHT TO ALLOTMENT WITH A MEMBER FLOWS FR OM HIS MEMBERSHIP OF THE SOCIETY. THE ALLOTMENT OF PLOT O F MEMBERS IN CONTINGENT UPON HIS BEING MEMBER OF A SOCIETY. TH E MEMBERSHIP IN SOCIETY IS EVIDENCED BY A SHARE CERT IFICATE. THE LAND IS OWNED BY THE SOCIETY IS EVIDENCED BY A SHA T WITH 3.08+4.62 ACRES OF LAND YET. THUS, SECTION 2(4) DO ES NOT APPLY IN THIS CASE BECAUSE AS PER AGREEMENT ONLY THE LAN D PROPORTIONATE TO THE PAYMENTS RECEIVED HAS TO BE RELINQUISHED. THUS THE SOCIETY RATE QUISHED ONLY 7.70 ACRES OF L AND YET AND NO MEMBER OF THE SOCIETY HAS BEEN ALLOTTED ANY FLA T YET SO THE CAPITAL GAIN CALCULATED IN WRONG AND AGAINST THE T RUE FACTS OF THE CASE WHICH MAY KINDLY BE CANCELLED. AGREEMENT TO T RANSFER HAS NOT BEEN REGISTERED UNDER REGISTERED UNDER REGISTR ATION ACT, 1908 AS PROVIDED IN SECTION 269(4A)(A) OF THE ACT. 8. THAT THE COST OF THE FLATS TO BE ALLOTTED TO MEMBER S AS ABOVE THE SAID HAS NOT BEEN QUANTIFIED. IF THERE ARE GAINS IT MUST HAVE TO BE QUANTIFIED ONLY THEN THE CAPITAL GAIN ARISING F ROM THE ASSET CAN BE INCLUDED. THE ASSESSEE HAS CONTACTED HIS RIG HT TO MEMBERSHIP OF SOCIETY IN EXCHANGE FOR A SHARE IN BU ILDING WHICH IS GOING TO CAME UP AT THE SITE OF LAND. THE PROJECTS HAVE NOT BEEN COMMENCED YET AS THE MATTER IS PENDING IN THE PUNJAB & HARYANA HIGH COURT. THUS, THERE IS NO CAPITAL GAI N ON FLAT WHICH IS TO BE ALLOTTED ON THE COMPLETION OF PROJEC T. 9. THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ADD ITION OF CAPITAL GAIN EQUAL TO THE VALUE OF THE FLAT AT RS.1 0125000 AS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 23 CAPITAL GAIN BECAUSE IF WE ACCEPT THE VALUE AS SALE VALUE AND THE SAME IS INVESTED IN THE CONSTRUCTION OF RESIDENTIAL HOUSE ON WHICH NO CAPITAL GAIN TAX IS PAYABLE U/S 54F OF THE ACT. 13. IN ITA NO.34(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE ORDER OF ACIT CIRCLE-1, AMRITSAR AND CONFIRMED BY THE CIT(A), AMRITSAR CREATING ADDITIONAL DEMAND O F RS.46,49,460/- BY REOPENING THE CASE U/S 147/148 FOR A.Y.2007-08 ON THE BASIS OF THE TRIPLICATE JOINT DEVELOPMENT AGREEMENT ENTERED WITH M/S. HASH BUILDERS PVT. LT D. CHANDIGARH AND TATA HOUSING DEVELOPMENT COMPANY L IMITED (THDC LIMITED) MUMBAI IS ILLEGAL, UNJUST AND AGAI NST THE FACTS OF THE CASE. 2. THAT THE WORTHY CIT(A) WHILE REJECTING THE APPEAL F AILED TO APPRECIATE THAT THE AGREEMENT WAS CANCELLED ON 13.06.2011 BY PASSING A RESOLUTION IN THE GENERAL H OUSE MEETING OF THE SOCIETY WHICH WAS ENTERED ON 25.02. 2007 WITH HASH BUILDERS PVT. LTD. AND THDC LIMITED AND A LSO CANCELLED THE POWER OF ATTORNEY BEFORE THE ASSISTAN T REGISTRAR BY THE PRESIDENT OF THE SOCIETY. 3. THAT THERE IS AT PRESENT NO AGREEMENT ON WHICH THE DEPARTMENT IS TAXING BECAUSE THE HONBLE PUNJAB & HARYANA HIGH COURT HAD ALREADY STOPPED CONSTRUCTION ON THE SAID LAND. 4. THAT IN VIEW OF THE SAID CANCELLATION OF THE AGREEM ENT THE APPELLANT ASSESSEE IS NOT ENTITLED TO RECEIVE F URTHER AMOUNT AND BUILD UP FLAT. THUS, QUESTION OF TAXING THE SAME IS VOID. 5. THAT A SPECIAL POWER OF ATTORNEY WAS ALSO GOT CANCE LLED BY THE PUNJABI COOP. HOUSE BUILDING SOCIETY LTD. ON 30.10.2011 BEFORE THE JT. SUB-REGISTRAR. 6. THAT THE WORTHY CIT(A) WHILE DECIDING THE MATTER FA ILED TO APPRECIATE THE JUDGMENT GIVEN BY THE HONBLE APE X COURT CLEARLY HELD THAT TRANSFER OF PROPERTY WHICH IS IMMOVABLE PROPERTY REGISTERED DEED OF CONVEYANCE ON LY VALID FOR LEGAL TRANSFER. GENERAL POWER OF ATTORNEY OR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 24 AGREEMENT NOT VALID AND NOT TO CREATE TITLE TO OR I NTEREST IN THE PROPERTY. 7. THAT THE OBSERVATION OF THE DEPTT TAXING THE SAME D URING THE AY 2007-08 ON THE BASIS OF MONETARY CONSIDERATI ON AND CONSIDERATION IN KIND IS BASELESS HAVING NO SUB STANCE AND UNCALLED FOR. 8. THAT THERE IS NO PROVISION UNDER THE ACT TO TAX NOT IONAL CAPITAL GAIN ON THE BASIS OF CONSIDERATION IN KIND, WHICH HAS NOT YET BEEN RECEIVED AND THE WORK HAS NOT YET STARTED. 9. THAT THERE IS NO YARD STICK FOR ASCERTAINING THE VA LUE OF FURNISHED FLAT OF 2250 SFT. WHICH IS NOT IN EXISTEN CE AND THERE WAS NO LIKELIHOOD OF ANY MATURITY OF THE AGRE EMENT BECAUSE THE WORK HAS NOT YET BEEN STARTED. 10. THAT A SUM OF RS.33 LACS WAS RECEIVED BY THE APPELL ANT NOT IN ONE YEAR BUT DURING TWO YEARS AND DECLARED T HE SAME BUT THE SAME WAS TAXED IN ONE YEAR WITHOUT CONSIDERING THAT THE APPELLANT RECEIVED THE AMOUNT IN TWO ASSESSMENT YEARS. 11. THAT THE BALANCE AMOUNT OF RS.82,50,000/- AGREED WA S NOT RECEIVED BY THE APPELLANT BUT ONLY 33 LACS AS MENTIONED ABOVE WAS RECEIVED AND THE BALANCE AMOUNT HAS NOT YET DUE AND NOT RECEIVED TILL DATE. 12. THAT THE AGREEMENT HAS NOT BEEN CONSIDERED PROPERLY BY THE A.O. AND FAILED TO UNDERSTAND THAT ONLY PART OF THE LAND WAS TRANSFERRED. 13. THAT THE APPELLANT ONLY TRANSFERRED THE DEVELOPMENT RIGHTS IN THAT PROPERTY AND NOT THE LAND ITSELF, WH ICH THE OFFICE FAILED TO APPRECIATE 14. THAT THERE IS NO OCCASION TO TAX NOTIONAL AMOUNT OF FURNISHED FLAT FOR WHICH VALUATION CANNOT BE ASCERT AINED AND NO ONE CAN SAY ABOUT THE FUTURE DUE TO CERTAIN FORMALITIES OF LEGAL NATURE. 15. THAT THE REPLY SUBMITTED BY THE ASSESSEE DURING ASSESSMENT HAS NOT BEEN CONSIDERED PROPERLY BECAUSE THERE WAS NO TRANSFER OF PROPERTY BUT ONLY SURRENDE R OF DEVELOPMENT RIGHTS. 16. THAT THE ASSESSEE ALSO DEPRIVED OF THE EXEMPTION U/ S 54EC SINCE NO FUNDS AVAILABLE. SIMILARLY, EXEMPTION U/S 54F CANNOT BE AVAILED.S ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 25 17. THAT THE ENTIRE ORDER PASSED IS ON THE BASIS OF WRO NG INTERPRETATION OF AGREEMENT. THUS, SECTION 2(47)(II ) AND SECTION 2(47)(VI) IS NOT APPLICABLE READ WITH SECTI ON 45 OF THE ACT. 18. THAT THE CASE LAW CITED IN THE ASSESSMENT ORDER ARE NOT RELEVANT TO THE PRESENT CASE. 19. IT IS, THEREFORE, PRAYED THAT THE ORDER OF ACIT, CI RCLE-1, AMRITSAR AS WELL AS CIT(A) BEING BAD IN LAW, MAY KI NDLY BE QUASHED AND APPEAL ACCEPTED. 14. IN ITA NO.162(ASR)/2013, THE ASSESSEE HAS RAISE D FOLLOWING GROUNDS OF APPEAL: 1. THAT LD. CIT(A) HAS ERRED IN LAW AND ON FACTS WHILE PASSING THE ORDER U/S 250(6) OF THE ACT. 2. THAT LD. CIT(A) HAS ERRED IN LAW AND IN FACTS IN UP HOLDING THE ORDER OF THE AO WHEREBY ADDITION OF RS.1,63,77,115/ - HAD BEEN MADE AS LONG TERM CAPITAL GAINS AGAINST THE RETURNE D CAPITAL GAINS OF RS.13,82,630/- 3. THAT LD. CIT(A) HAS NOT BEEN JUSTIFIED IN UPHOLDING TAXING OF CAPITAL GAINS ON RECEIVABLES WHICH ARE CONDITIONAL TO BE RECEIVED ON THE RECEIPT OF ALL SANCTION/CLEARANCE W .R.T THE PROJECT FROM VARIOUS GOVERNMENT DEPARTMENTS. 4. THAT LD. CIT(A) HAS BEEN UNJUSTIFIED IN NOT APPRECI ATING THAT THAT THE EXECUTED JOINT DEVELOPMENT AGREEMENT HAD B EEN CANCELLED AND POWER OF ATTORNEY ISSUED TO PROMOTER/ DEVELOPER HAD BEEN REVOKED AS A RESULT OF WHICH CONSIDERATION RECEIVED PARTAKES THE NATURE OF DEBT. 5. THAT LD. CIT(A) HAS NOT BEEN JUSTIFIED IN PASSING N ON-SPEAKING ORDER ON THE ISSUE OF CANCELLATION OF THE JOINT DEV ELOPMENT AGREEMENT. 6. THAT LD. CIT(A) HAS ERRED IN FAILING TO APPRECIATE THAT THE COMMENCEMENT OF THE PROJECT/TRIPARTITE AGREEMENT HA S BEEN CHALLENGED IN HONBLE HIGH COURT AND THE MATTER IS SUBJUDICE. 7. THAT LD. CIT(A) HAS NOT BEEN JUSTIFIED IN NOT APPRE CIATING THE FACT THAT THE JOINT DEVELOPMENT AGREEMENT WAS NOT R EGISTERED AND BY VIRTUE OF THE REGISTRATION AND OTHER RELATED LAWS (AMENDMENT ACT,2001) TRANSFER OF PROPERTY ACT, 1882 HAS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 26 BEEN AMENDED AND ONLY REGISTERED CONTRACTS FALL WIT HIN AMBIT OF SECTION 53A AND CONSEQUENTLY U/S 2(47)(V) OF THE AC T. 8. THAT LD. CIT(A) HAS NOT BEEN JUSTIFIED IN NOT APPRE CIATING THE REGISTRATION DEEDS EXECUTED BY SOCIETY IN WHICH IT HAS BEEN CLEARLY MENTIONED THAT POSSESSION OF THE PROPERTY HAS NOT BEEN GIVEN AND IS BEING GIVEN ONLY TO THE EXTENT FOR WHI CH REGISTRATION DEED WAS BEING EXECUTED AND THUS CONDI TIONS WHICH WERE REQUIRED TO HOLD JOINT DEVELOPMENT AGREEMENT A S AGREEMENT FOR SALE HAD NEVER BEEN FULFILLED. 9. THAT THE ENTIRE HYPOTHETICAL ADDITION IS BASED ON AN AGREEMENT RELIED UPON IN PARTS BY THE A.O. WHICH IN FACT HAS NOT BEEN IMPLEMENTED TILL DATE AND AS SUCH THE ADDITION MADE AND UPHELD BY THE CIT(A) ON SUSPICION, SURMISES AND CONJECTUR ES MERITS DELETION. 10. THAT THE AGREEMENT RELIED UPON BY A.O. HAVE TO BE R EAD AS WHOLE AND NOT IN PARTS WHICH HAS BEEN SO DONE BY TH E A.O. AS CLAUSES RELATING TO TRANSFER OF OWNERSHIPS, RIGHTS TERMINATION, POSSESSION HAVE BEEN BRUSHED ASIDE WHILE ONLY THE CONSIDERATION CLAUSE AS SUCH THE ENTIRE ADDITION MA DE AND UPHELD BY THE CIT(A) MERITS DELETION. 11. THAT LD. CIT(A) HAS NOT BEEN JUSTIFIED IN NOT APPR ECIATING THE IN UPHOLDING THE ADDITION OF RS.1,01,25,000/- TO BE THE ALLEGED VALUE OF ONE FLAT MEASURING2250 SQ. FT. @ RS.4500/- PER SQ. FEET RELYING UPON AN AGREEMENT ENTERED INTO BETWEEN THIR D PARTIES. 12. THAT IN CASE THE VALUE OF RESIDENTIAL FLAT TO BE RE CEIVED IS UPHELD TO BE LONG TERMS CAPITAL GAINS, THE LD. CIT( A) HAS ERRED IN LAW IN NON ALLOWANCE OF BENEFIT PROVIDED U/S 54/ 54AF AS THE FLAT WHICH ARE TO BE RECEIVED IS IN THE NATURE OF R ESIDENTIAL FLAT ONLY AND THE SALE CONSIDERATION SHOULD BE TAKEN AS HAVING BEEN INVESTED IN THE NEW RESIDENTIAL PROPERTY ONLY. 13. THAT THE LD. CIT(A) HAS NOT BEEN JUSTIFIED IN NOT A PPRECIATING THAT ASSESSEE AS AN INDIVIDUAL IS NOT PART TRIPARTI TE AGREEMENT EXECUTED BETWEEN PUNJAB CO-OP. HOUSE BUILDING SOCI ETY LTD. AND BUILDER COMPANY. 14. THAT ANY OTHER GROUND WHICH MAY BE TAKEN UP AT THE TIME OF HEARING WITH THE KIND PERMISSION. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 27 15. IN ITA NO.277(ASR)/2013, THE ASSESSEE HAS RAISE D FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LD. CIT(A) INDEPENDENT OF HIS FINDING S AS GIVEN IN THE CASE OF MR. MANORANJAN KALIA AND MECHANICALLY APP LIED TO THIS CASE, OUGHT TO HAVE HELD THE AOS ORDER IN THIS CASE AS NON EST, SINCE THE JURISDICTION U/S 148 HAD BEEN PREMATUR ELY INVOKED BEFORE THE EXPIRY OF TIME LIMIT, AVAILABLE TO ISS UE NOTICE U/S 143(2). 2. THAT THE LD. CIT(A) HAS GROSSLY ERRED IN UPHOLDING THE VALIDITY OF PROCEEDINGS INITIATED BY AO U/S 147/148 WITHOUT PROPER APPRECIATION OF THE FACTS AND THE POSITION OF LAW Q UA SUCH FACTS. 3. THAT THE LD. CIT(A) MISDIRECTED HIMSELF IN LAW AND ON FACTS IN CONFIRMING THE TAXATION OF NOTIONAL CAPITAL GAIN OF RS.1,63,21,208/- BY WRONGLY UPHOLDING THE TRANSFER OF LAND, TO HAVE TAKEN PLACE ON THE SALE OF SECTION OF JOINT DE VELOPMENT AGREEMENT WITH THE DEVELOPERS. 4. THAT THE LD. CIT(A) OUGHT TO HAVE READ THE JOINT D EVELOPMENT AGREEMENT IN TOTALITY, SO AS TO NOT TO INFER THE AC CRUAL OF CAPITAL GAIN ON THE VERY DATE OF EXECUTION OF THE SAID AGRE EMENT. 5. THAT WHEN CIT(A) HIMSELF ADMITTED THAT TWO FLATS, M ADE PART OF SALE CONSIDERATION, WERE NON-EXISTENT, HIS UPHOLDIN G THE TAXATION OF CAPITAL GAIN, COMPUTED ON A SALE VALUE, COMPRISED MAINLY OF THE VALUE OF SAID TWO FLATS, IS SELF CONT RADICTORY. 6. THAT THE LD. CIT(A) WAS NOT JUSTIFIED OVERLOOKING V ARIOUS JUDICIAL AUTHORITIES RELIED UPON BY ASSESSEE, ON A FACIAL DISTINCTION DRAWN BY HIM. 7. THAT THE ASSESSEES ALTERNATE CLAIM OF DEDUCTION U/ S 54F OUGHT TO HAVE BEEN ALLOWED BY THE LD. CIT(A). 8. THAT THE LD. CIT(A) WRONGLY REJECTED THE ASSESSEES CLAIM THAT THE IMPUGNED CAPITA GAIN, IF ANY, COULD BE ASSESSED ONLY IN THE HANDS OF THE SOCIETY AND NOT THE ASSESSEE MEMBER. 9. THAT THE ASSESSEES CLAIM NOT TO TAX THE IMPUGNED G AIN ON THE PRINCIPLES OF MUTUALITY INVOLVED IN THE TRANSACTION S, HAS BEEN WRONGLY REJECTED BY THE CIT(A). 10. THAT CHARGING OF INTEREST U/S 234A & 234B HAS BEEN WRONGLY CONFIRMED. 11. THAT INITIATION OF PENALTY U/S 271(1)(C) HAS BEEN W RONGLY CONFIRMED. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 28 12. THAT THE ORDER UNDER APPEAL IS WHOLLY AGAINST LAW A ND FACTS OF THE CASE. 16. IN ITA NO.338(ASR)/2013, THE ASSESSEE HAS RAISE D FOLLOWING GROUNDS OF APPEAL: 1. ON FACTS & IN CIRCUMSTANCES OF THE CASE, THE L D. CIT(A) HAS MISTAKENLY POINTED OUT PRESENCE & ARGUMENTS BY SH . ANUPAM GUPTA, ADVOCATE WHEREAS NO NOTICE OF APPEARANCE H AS BEEN SERVED UPON THE AR, THUS, MAKING IT AN UNREPRESEN TED AND UNHEARD CASE AS THE APPELLANT IS UNDER TREATMENT OF CANCER IN AUSTRALIA. 2. ON FACTS & IN CIRCUMSTANCES OF THE CASE, THE AO HAS GROSSLY ERRED BY INVOKING PROVISIONS OF SEC. 2(47)(V) OF TH E ACT SPECIFICALLY WHEN THE CONDITION OF RECEIPT OF FULL PAYMENT AND HANDING OVER FULL LAND BY THE SELLER TO THE PURCHAS ER ARE MISSING. 3. ON FACTS & IN CIRCUMSTANCES OF THE CASE, THE AO HAS ERRED WHILE IGNORING THE REVISED RETURN BECAUSE THE APPELLANT H AD NOT RECEIVED ANY ORDER ON THE BASIS OF ORIGINAL RETURN. 4. ON FACTS & IN CIRCUMSTANCES OF THE CASE, WHEN EVEN PART SALE OF LAND HAS NOT BEEN ACCEPTED BY THE REVENUE AUTHORITI ES AND OTHERWISE ALSO WHEN THE MATTER IS SUB-JUDICIOUS BEF ORE THE HONBLE P & H HIGH COURT, THE ACTION OF A.O. TO TA KE FULL AMOUNT OF RS.91,75,000/- TO COMPUTE THE LTCG IS BAS ED ON SURMISES AND CONJECTURE MAKING THE ORDER OF A.O. IL LEGAL AND BAD IN LAW. 5. ONLY CAPITAL GAIN AS COMPUTED IN THE REVISED RETURN SHOULD HAVE BEEN ASSESSED AS THE ASSESSEE HAD SOLD PART OF LAND WORTH RS.16,00,000/-. 6. ANY OTHER POINT WITH THE PERMISSION OF CHAIR ON THE HEARING DATE, KINDLY ACCEPT THE APPEAL. 17. IN ITA NO.244(ASR)/2011, THE ASSESSEE HAS RAISE D FOLLOWING GROUNDS OF APPEAL: 1. THAT ORDER UNDER APPEAL IS AGAINST LAW AND FAC TS OF THE CASE. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 29 2. THAT REOPENING OF ASSESSMENT U/S147 ON A CHANGE OF OPINION IS ILLEGAL, UNJUSTIFIED AND UNWARRANTED BY THE FACTS OF THE CASE. 3. THAT THE ASSESSEE RECEIVED PART PAYMENT OF CONS IDERATION OF RS.15,00,000/- AND RS.18,00,000/- IN FEBRUARY, 20 07 AND IN APRIL, 2007 IN LIEU OF THE AGREEMENT. THESE AMOUN TS WERE DEPOSITED IN THE BANK UNDER CAPITAL GAIN SCHEME, RENEWED TDR BY THE BANK AND AFTER WITHDRAWING THIS AMOUNT INVESTED THE SAME IN CONSTRUCTION OF RESIDENTIAL HOUSE AT TANDA. 4. THAT DISALLOWANCE OF CLAIM U/S 54F OF THE ACT BECAU SE THE SAID TDR WAS RENEWED UNDER NORMAL STDR WHEN THE INITIAL TDR WAS INVESTED UNDER CAPITAL GAIN SCHEME AND THE BANK RENEWED THE SAID TDR UNDER NORMAL TDR, DEDUCTION U/S 54F CA NNOT BE DENIED BY THE FAULT COMMITTED BY THE BANK. 5. THAT THE ASSESSEE HAS NOT RECEIVED THE REMAINING CO NSIDERATION RS.49,50,000/- AND A PURPOSED FLAT TILL TODAY AND T HE ITO TAXED THAT AMOUNT. 6. THAT THE ASSESSEE IS DEPRIVED OF AVAILING THE DEDUC TION U/S 54F & 54EC OF THE ACT BY TAXING AMOUNT OF RS.49,50,000/ - AND RS.1,01,25,000/- VALUE OF THE PURPOSED FLAT. 7. THAT THE PROVISIONS OF SEC. 2(47)(V) IS SILENT WHER E FULL AMOUNT OF AGREED CONSIDERATION IS CHARGED TO TAX THOUGH VE RY NOMINAL AMOUNT MIGHT HAVE ACTUALLY BEEN RECEIVED RESULTING IN A SITUATION WHERE AN ASSESSEE MAY NOT BE HAVING FUNDS TO PAY THE TAXES. 8. THAT THERE IS NO PROVISION IN THE ACT TO REVERSED T HE CAPITAL GAIN TAX PAID BY THE ASSESSEE ON ACCOUNT OF CANCELLATION OF THE AGREEMENT AFTER THE TIME PERIOD FOR REVISION OF THE INCOME TAX RETURN. 9. THAT PROVISION OF SECTION 2(47)(V) IS ULTRA VIRUS O F THE RIGHT PROVIDED UNDER THE CONSTITUTION OF INDIA AND NEEDS AMENDMENT TO THE EFFECT THAT TAX SHOULD BE CHARGED ONLY TO TH E EXTEND THE CONSIDERATION RECEIVED AND THE REMAINING BALANCE CO NSIDERATION SHOULD BE TAXED IN THE YEAR IN WHICH RECEIVED AND T HE ASSESSEE MAY AVAIL EXEMPTION U/S 54F & 54EC OF THE ACT BY IN VESTING THE PROCEEDS. 10. THAT ORDER UNDER APPEAL BEING AGAINST LAW & FACTS O F THE CASE IS LIABLE TO BE QUASHED., ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 30 18. IN ITA NO.485(ASR)/2011, THE ASSESSEE HAS RAISE D FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS), AMRITSAR HAS FAILED TO APPRECIATE THAT BOTH THE IS SUE OF NOTICE U/S 148 BY INCOME TAX OFFICER, WARD 5(4), AMRITSAR AND SUB SEQUENT RE- ASSESSMENT ORDER ARE LEGALLY UNTENABLE. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS), AMRITSAR HAS FAILED TO APPRECIATE THAT THE ASSESSM ENT ORDER DATED 20.12.2011 WAS BARRED BY TIME, SINCE INCOME TAX OF FICER, WARD 5(4), AMRITSAR HAD ISSUED THE FIRST NOTICE U/S 143(2) OF INCOME TAX ACT, 1961 ON 01.11.2012 WHICH WAS BEYOND SIX MONTHS FRO M THE END OF THE FINANCIAL YEAR IN WHICH RETURN WAS FILED BY THE AS SESSEE. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ADDIT ION OF RS. 3,67,50,000/- MADE BY INCOME TAX OFFICER, WARD 5(4 ), AMRITSAR ON ACCOUNT OF ALLEGED CAPITAL GAIN. 4. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WAR 5(4), AMRITSA R HAVE GROSSLY ERRED IN NO APPRECIATING THAT THE DECISION OF CIT VS. V.K. JULANI BASHA 256 ITR 282 RELIED UPON BY THE ASSESSING OFF ICER WAS IN FACT IN FAVOUR OF THE ASSESSEE. 5. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE GROSSLY ERRED IN NOT APPRECIATING THE FACT THAT THE CAPITA L GAIN COULD ARISE TO THE SOCIETY/ALLOTTEE ONLY ON SALE PRICE OF RS. 30, 00,000/- ON PRORATE EXECUTION OF REGISTERED SALE DEEDS FOR LAND OF EQU IVALENT VALUE BEING 3.08 ACRES AS MENTIONED IN PARAS 4.1(1),(II) OF TH E JOINT DEVELOPMENT AGREEMENT DATED 25.02.2007 DUE TO PART PERFORMANC E OF JDA. 6. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE FAILED TO APPRECIATED THAT SINCE HASH BUILDERS PVT. LTD. AND THDC LTD. DID NOT MAKE PAYMENTS DUE UNDER THE JDA & DID NOT CARRY OU T THEIR PART OF THE JDA WITHIN THE TIME REQUIRED, THE SOCIETY/ALLO TTEE HAD TERMINATED THE JDA UNDER CLAUSE 14(IV) OF THE JDA VIDE RESOLU TION DATED 13.06.2011 OF THE SOCIETY. 7. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE FAILED TO APPRECIATED THAT DUE TO TERMINATION OF THE AGREEME NT BY THE SOCIETY/ALLOTTEE, THE JDA HAD CEASES TO EXIST WITH REGARD TO THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 31 REMAINING PAYMENTS DUE UNDER THE JDA AND THE SAME COULD NOT BE BROUGHT TO CAPITAL GAINS TAX AT ALL. 8. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE GROSSLY ERRED IN NOT ALLOWING DEDUCTION U/S 54F OF THE IN COME TAX ACT, 1961 TO THE ASSESSEE AS CLAIMED IN THE REVISED RETURN. 9. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR HAS GROSSLY ERRED IN REJECTING THE ALTERN ATIVE CLAIM OF THE ASSESSEE U/S 54F OF THE INCOME TAX ACT, 1961 IN RE SPECT OF THE FLATS ALLEGED TO HAVE BEEN ALLOTTED TO THE ASSESSEE. 10. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS), AMRITSAR HAS GROSSLY ERRED IN CONFIR MING THE ACTION OF THE ASSESSING OFFICER IN CHARGING INTEREST U/S234A AT RS. 5,74,656/- AND INTEREST U/S 234-B AT RS. 46,79,347/-. 19. IN ITA NO.37(ASR)/2013, THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN LAW IN DIRECTING THE A.O. TO C ONSIDER THE CLAIM OF BENEFIT U/S 54F OF THE ASSESSEE U/S 154 OF THE I. T. ACT, 1961 AS THE SAME TANTAMOUNT TO SETTING ASIDE OF THE ISSUE. 2. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND OR M ORE GROUNDS OF APPEAL AT THE TIME OF HEARING OF APPEAL. 20. IN ITA NO.15(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE WORTHY COMMISSIONER OF INCOME TAX(APP EALS) ERRED ON FACTS AND IN LAW IN SUSTAINING THE ADDITION OF LONG TERM CAPITAL GAIN OF RS. 1,59,82,147/- CONFIRMING THE VIEW TAKEN BY LD. ITO THAT THE AGREEMENT AMOUNTS TO TRANSFER OF FULL LAND UNDER S ECTION 2(47) OF THE INCOME TAX ACT, 1961. 2. THAT THE WORTHY COMMISSIONER OF INCOME TAX(APPE ALS) ERRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITIONS MA DE BY THE ASSESSING OFFICER ON THE BASIS OF NET CONSIDERATION OF ENTIR E PLOT WHICH WAS NOT YET RECEIVED NOR LIKELY TO BE RECEIVED IGNORING TH E FACTS ALL TOGETHER THAT CAPITAL GAIN IS TO BE WORKED ON THE BASIS OF PRORATA SALE AND REGISTRATION THEREOF AS PER THE TERMS OF THE JOINT AGREEMENT DEED. THE APPELLANT SHOWED THE CORRECT CAPITAL GAINS ON THE PORTION OF SALE DEED ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 32 EXECUTED AND REGISTERED ON 25.02.2007 OF 72 SQ. YD S DURING THE YEAR UNDER APPEAL OUT OF HIS SHARE OF 500 SQ. YDS. 3. THAT THE WORTHY COMMISSIONER OF INCOME-TAX (APP EAL) FURTHER ERRED ON FACTS AND IN LAW IN HOLDING THAT POSSESSION OF IMMOVABLE PROPERTY GIVEN BY THE SOCIETY TO THDC IS TRANSFER WITHIN TH E MEANING OF CLAUSE (VI) OF SECTION 2(47) READ WITH SECTION 53A OF THE TRANSFER OF PROPERTY ACT, 1882 IGNORING THE FACTS ALTOGETHER THAT POSSE SSING OF THE PROPERTY WAS GIVEN BY THE SOCIETY TO THDC FOR DEVELOPMENT P URPOSE ONLY. THE RELEVANT PROVISIONS OF SECTION 2(47) AS ALSO THE P ROVISIONS OF SECTION 53A OF THE TRANSFER OF PROPERTY ACT, 1882, OF THE FACTS OF THIS CASE, HAVE BEEN MISCONSTRUED BY THE LEARNED. CIT(A) TO C ONFIRM THE ITOS ORDER. 4. THAT THE WORTHY COMMISSIONER OF INCOME TAX(APPE ALS) FAILED TO APPRECIATED THAT THE AGREEMENT ENTERED INTO BY THE APPELLANT WAS SUBJECT TO VARIOUS REGULATORY/STATUTORY/OTHER APPR OVALS/PERMISSIONS, ETC, REQUIRED TO BE OBTAILNED BY THE OTHER PARTY(I ES), WHICH WERE NOT OBTAINED AND HENCE THERE COULD BE NO TRANSFER UN DER THE SAID AGREEMENT. 5. THAT THE WORTHY COMMISSIONER OF INCOME TAX (APP EALS) ERRED ON FACTS AND IN LAW IN CONSIDERING THAT THE RECEIP T OF CONSIDERATION AND REGISTRATION OF PROPERTY ARE NOT RELEVANT FACTORS WHILE DETERMINING THE TRANSFER OF PROPERTY FOR CALCULATING CAPITAL GAIN UNDER THE INCOME-TAX ACT. 6. THAT THE COMMISSIONER OF INCOME TAX(APPEALS) ER RED ON FACTS AND IN LAW IN CONFIRMING THE FINDING OF THE ASSESS ING OFFICER THAT THERE WAS DEEMED TRANSFER OF PROPERTY ON THE DATE OF SIG NING OF TRIPARTITE JOINT DEVELOPMENT AGREEMENT ( THE AGREEMENT) ITS ELF, IN TERMS OF SUB-SECTIONS (II), (V) AND (VI) SECTION 2(47) OF T HE ACT. 7. THAT THE COMMISSIONER OF INCOME TAX(APPEALS) FA ILED TO APPRECIATED THAT THE CAPITAL GAIN ON THIS LAND HAS ALREADY BEEN ASSESSED IN THE HANDS OF SOCIETY BY DCIT, MOHALI WHILE MAK ING INCOME TAX ASSESSMENT OF PUNJABI HOUSING COOPERATIVE SOCIETY AND SAME INCOME (CAPITAL GAIN) CANNOT BE TAXED IN THE HANDS OF THE APPELLANT ALSO. IT LEADS TO DOUBLE TAXATION OF THE SAME INCOME. 8. THAT THE COMMISSIONER OF INCOME TAX (APPEALS) E RRED ON FACTS AND IN LAW IN CONFIRMING THE ADDITIONS MADE OF THE VALUE OF THE FLAT RECEIVED TOWARDS PART CONSIDERATION OF THE ALLEGED TRANSFER OF PROPERTY, @ RS. 4500 PER SQ. FEET BY ASSUMING NOTIONAL CONSI DERATION OF A NONEXISTENT FLAT, NOT BEING CONSISTENT WITH THE BA SIC LAW OF INCOME TAX ACT. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 33 9. THAT THE COMMISSIONER OF INCOME TAX(APPEALS) HA S FAILED TO APPRECIATED THAT UNDER THE PROVISIONS OF THE ACT W HAT COULD BE BROUGHT TO TAX IS ONLY THE REAL INCOME AND NOT AN AMOUNT W HICH WAS NEITHER RECEIVED NOR LIKELY TO BE RECEIVED BY THE ASSESSEE AND MORE OVER ON THE MARKET VALUE OF THE ASSET WHICH IS STILL NOT I N EXISTENCE. BESIDES, THE ASSESSEE HAS BEEN DEPRIVED FOR CLAIMING EXEMPT ION UNDER SECTION 54EC AND OTHER SECTIONS 54, DUE TO NON RECEIPT OF ENTIRE SALE CONSIDERATION. 10 THAT THE LD. CIT(APPEAL) FAILED TO APPRECIATE T HAT THE LD. ITO HAS RAISED THE DEMAND OF RS. 4733375/- AGAINST TOT AL AMOUNT OF 3300000/- RECEIVED BY THE APPELLANT WHICH IS AGAIN ST THE PRINCIPLE OF NATURAL JUSTICE OF LAW AS AGREEMENT HAS BEEN TERMI NATED AND THERE IS NO CHANCE TO GET ANY MORE BENEFIT IN NEAR FUTURE. 11. IT IS THEREFORE PRAYED THAT THE ADDITION MADE BY LD. ASSESSING OFFICER AND CONFIRMED BY WORTHY COMMISSIONER OF IN COME- TAX(APPEALS) MAY KINDLY BE DELETED. 12. APPELLANT CRAVES LEAVE TO ADD, ALTER OR DELETE ANY GROUND(S) EITHER BEFORE OR IN THE COURSE OF HEARING OF THE APPEAL W ITH THE PERMISSION OF THE COURT. 21. IN ITA NO.51(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX(AP PEALS), AMRITSAR HAS FAILED TO APPRECIATED THAT BOTH THE I SSUE OF NOTICE U/S 148 BY INCOME TAX OFFICER, WARD 5(4), AMRITSAR AND SUB SEQUENT REASSESSMENT ORDER ARE LEGALLY UNTENABLE. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS), AMRITSAR HAS FAILED TO APPRECIATE THAT THE INCOME TAX OFFICER, WAR 4(1), AMRITSAR HAD NO BASIS TO COME TO THE CONCLUS ION THAT THE ASSESSEE WAS THE LEGAL HEIR PARTICULARLY WHEN THE PAYMENT U NDER THE ALLEGED JOINT DEVELOPMENT AGREEMENT (JDA) DATED 25.02.2007 WERE RECEIVED BY THE THREE GRANDSONS OF SMT. HARJIT KAUR. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ADDIT ION OF RS. 44,03,389/- MADE BY INCOME TAX OFFICER, WARD 5(4), AMRITSAR ON ACCOUNT OF 1/4 TH SHARE OF ALLEGED CAPITAL GAIN. 4. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE GROSSLY ERRED IN NOT APPRECIATING THAT THE DECISION OF CIT VS. V.K. JULANI ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 34 BASHA 256 ITR 282 RELIED UPON BY THE ASSESSING OFF ICER WAS IN FACT IN FAVOUR OF THE ASSESSEE. 5. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE GROSSLY ERRED IN NOT APPRECIATING THE FACT THAT THE CAPITA L GAIN COULD ARISE TO THE SOCIETY/ALLOTTEE ONLY ON SALE PRICE OF RS. 15, 00,000/- ON PRORATA EXECUTION OF REGISTERED SALE DEEDS FOR LAND OF EQU IVALENT VALUE BEING 3.08 ACRES AS MENTIONED IN PARAS 4.1(1),(II) OF TH E JOINT DEVELOPMENT AGREEMENT DATED 25.02.2007 DUE TO PART PERFORMANCE OF JDA. 6. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE FAILED TO APPRECIATE THAT SINCE HASH BUILDERS PVT. LTD. AND THDC LTD. DID NOT MAKE PAYMENTS DUE UNDER THE JDA & DID NOT CARRY O UT THEIR PART OF THE JDA WITHIN THE TIME REQUIRED, THE SOCIETY/ALLO TTEE HAD TERMINATED THE JDA UNDER CLAUSE 14(IV) OF THE JDA VIDE RESOLU TION DATED 13.06.2011 OF THE SOCIETY. 7. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE FAILED TO APPRECIATE THAT DUE TO TERMINATION OF THE AGREEMEN T BY THE SOCIETY/ALLOTTEE, THE JDA HAD CEASED TO EXIST WITH REGARD TO THE REMAINING PAYMENTS DUE UNDER THE JDA AND THE SAME COULD NOT BE BROUGHT TO CAPITAL GAINS AT ALL. 8. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR HAS GROSSLY ERRED IN REJECTING THE ALTERN ATIVE CLAIM OF THE ASSESSEE U/S 54F OF INCOME TAX ACT, 1961 IN RESPEC T OF THE FLATS ALLEGED TO HAVE BEEN ALLOTTED TO THE ASSESSEE. 9. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ACTIO N OF THE ASSESSING OFFICER IN CHARGING INTEREST U/S 234A AT 5,23,702/ - AND INTEREST U/S 234-B AT RS. 5,63,227/- 22. IN ITA NO.52(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX(AP PEALS), AMRITSAR HAS FAILED TO APPRECIATED THAT BOTH THE I SSUE OF NOTICE U/S 148 BY INCOME TAX OFFICER, WARD 5(4), AMRITSAR AND SUB SEQUENT REASSESSMENT ORDER ARE LEGALLY UNTENABLE. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS), AMRITSAR HAS FAILED TO APPRECIATE THAT THE INCOME TAX OFFICER, WAR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 35 4(1), AMRITSAR HAD NO BASIS TO COME TO THE CONCLUS ION THAT THE ASSESSEE WAS THE LEGAL HEIR PARTICULARLY WHEN THE PAYMENT U NDER THE ALLEGED JOINT DEVELOPMENT AGREEMENT (JDA) DATED 25.02.2007 WERE RECEIVED BY THE THREE GRANDSONS OF SMT. HARJIT KAUR. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ADDIT ION OF RS. 44,03,389/- MADE BY INCOME TAX OFFICER, WARD 5(4), AMRITSAR ON ACCOUNT OF 1/4 TH SHARE OF ALLEGED CAPITAL GAIN. 4. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE GROSSLY ERRED IN NOT APPRECIATING THAT THE DECISION OF CIT VS. V.K. JULANI BASHA 256 ITR 282 RELIED UPON BY THE ASSESSING OFF ICER WAS IN FACT IN FAVOUR OF THE ASSESSEE. 5. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE GROSSLY ERRED IN NOT APPRECIATING THE FACT THAT THE CAPITA L GAIN COULD ARISE TO THE SOCIETY/ALLOTTEE ONLY ON SALE PRICE OF RS. 15, 00,000/- ON PRORATA EXECUTION OF REGISTERED SALE DEEDS FOR LAND OF EQU IVALENT VALUE BEING 3.08 ACRES AS MENTIONED IN PARAS 4.1(1),(II) OF TH E JOINT DEVELOPMENT AGREEMENT DATED 25.02.2007 DUE TO PART PERFORMANCE OF JDA. 6. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE FAILED TO APPRECIATE THAT SINCE HASH BUILDERS PVT. LTD. AND THDC LTD. DID NOT MAKE PAYMENTS DUE UNDER THE JDA & DID NOT CARRY O UT THEIR PART OF THE JDA WITHIN THE TIME REQUIRED, THE SOCIETY/ALLO TTEE HAD TERMINATED THE JDA UNDER CLAUSE 14(IV) OF THE JDA VIDE RESOLU TION DATED 13.06.2011 OF THE SOCIETY. 7. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE FAILED TO APPRECIATE THAT DUE TO TERMINATION OF THE AGREEMEN T BY THE SOCIETY/ALLOTTEE, THE JDA HAD CEASED TO EXIST WITH REGARD TO THE REMAINING PAYMENTS DUE UNDER THE JDA AND THE SAME COULD NOT BE BROUGHT TO CAPITAL GAINS TAX AT ALL. 8. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR HAS GROSSLY ERRED IN REJECTING THE ALTERN ATIVE CLAIM OF THE ASSESSEE U/S 54F OF INCOME TAX ACT, 1961 IN RESPEC T OF THE FLATS ALLEGED TO HAVE BEEN ALLOTTED TO THE ASSESSEE. 9. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ACTIO N OF THE ASSESSING ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 36 OFFICER IN CHARGING INTEREST U/S 234A AT 5,23,702/ - AND INTEREST U/S 234-B AT RS. 5,63,227/- 23. IN ITA NO.56(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX(AP PEALS), AMRITSAR HAS FAILED TO APPRECIATED THAT BOTH THE I SSUE OF NOTICE U/S 148 BY INCOME TAX OFFICER, WARD 5(4), AMRITSAR AND SUB SEQUENT REASSESSMENT ORDER ARE LEGALLY UNTENABLE. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS), AMRITSAR HAS FAILED TO APPRECIATE THAT THE INCOME TAX OFFICER, WAR 4(1), AMRITSAR HAD NO BASIS TO COME TO THE CONCLUS ION THAT THE ASSESSEE WAS THE LEGAL HEIR PARTICULARLY WHEN THE PAYMENT U NDER THE ALLEGED JOINT DEVELOPMENT AGREEMENT (JDA) DATED 25.02.2007 WERE RECEIVED BY THE THREE GRANDSONS OF SMT. HARJIT KAUR. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX(APP EALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ADDIT ION OF RS. 44,03,389/- MADE BY INCOME TAX OFFICER, WARD 5(4), AMRITSAR ON ACCOUNT OF 1/4 TH SHARE OF ALLEGED CAPITAL GAIN. 4. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE GROSSLY ERRED IN NOT APPRECIATING THAT THE DECISION OF CIT VS. V.K. JULANI BASHA 256 ITR 282 RELIED UPON BY THE ASSESSING OFF ICER WAS IN FACT IN FAVOUR OF THE ASSESSEE. 5. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE GROSSLY ERRED IN NOT APPRECIATING THE FACT THAT THE CAPITA L GAIN COULD ARISE TO THE SOCIETY/ALLOTTEE ONLY ON SALE PRICE OF RS. 15, 00,000/- ON PRORATA EXECUTION OF REGISTERED SALE DEEDS FOR LAND OF EQU IVALENT VALUE BEING 3.08 ACRES AS MENTIONED IN PARAS 4.1(1),(II) OF TH E JOINT DEVELOPMENT AGREEMENT DATED 25.02.2007 DUE TO PART PERFORMANCE OF JDA. 6. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE FAILED TO APPRECIATE THAT SINCE HASH BUILDERS PVT. LTD. AND THDC LTD. DID NOT MAKE PAYMENTS DUE UNDER THE JDA & DID NOT CARRY O UT THEIR PART OF THE JDA WITHIN THE TIME REQUIRED, THE SOCIETY/ALLO TTEE HAD TERMINATED THE JDA UNDER CLAUSE 14(IV) OF THE JDA VIDE RESOLU TION DATED 13.06.2011 OF THE SOCIETY. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 37 7. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR AND INCOME TAX OFFICER, WARD 5(4), AMRITS AR HAVE FAILED TO APPRECIATE THAT DUE TO TERMINATION OF THE AGREEMEN T BY THE SOCIETY/ALLOTTEE, THE JDA HAD CEASED TO EXIST WITH REGARD TO THE REMAINING PAYMENTS DUE UNDER THE JDA AND THE SAME COULD NOT BE BROUGHT TO CAPITAL GAINS TAX AT ALL. 8. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X(APPEALS), AMRITSAR HAS GROSSLY ERRED IN REJECTING THE ALTERN ATIVE CLAIM OF THE ASSESSEE U/S 54F OF INCOME TAX ACT, 1961 IN RESPEC T OF THE FLATS ALLEGED TO HAVE BEEN ALLOTTED TO THE ASSESSEE. 9. THAT BOTH THE LEARNED COMMISSIONER OF INCOME TA X (APPEALS), AMRITSAR HAS GROSSLY ERRED IN CONFIRMING THE ACTIO N OF THE ASSESSING OFFICER IN CHARGING INTEREST U/S 234A AT 5,23,702/ - AND INTEREST U/S 234-B AT RS. 5,63,227/-. 24. IN ITA NO.58(ASR)/2013, THE ASSESSEE HAS RAISED FOLLOWING GROUNDS OF APPEAL: 1. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED COMMISSIONER OF INCOME TAX(APPEALS) HAS ER RED IN CONFIRMING THE ADDITION MADE BY ASSESSING OFFICER FOR RS. 35343197/- AS LONG TERM CAPITAL GAINS. 2. THAT THE LEARNED CIT(A) HAS FURTHER ERRED IN CO NFIRMING THE ABOVE ADDITION OF RS. 35343197/-ON ACCOUNT OF LONG TERM CAPITAL GAINS JUST ON PRESUMPTION, SUSPICIONS, SURMISES AN D CONJECTURES AND IN ABSENCE OF ANY MATERIALS OR EVIDENCE FOUND AGAINST THE APPELLANT. HE WAS JUST RELIED ON THE TRIPARTITE SALES AGREEMENT BETWEEN PUNJABI CO- OP. HOUSE BUILDING SOCIETY LTD. HARH BUILDERS PVT. LIMITED AND THE THDC LTD., WHICH STILL NEED TO BE EXECUTED. SO, T HE ADDITION MADE NEEDS TO BE DELETED. 3. THAT THE LEARNED CIT(A) HAS FURTHER ERRED IN MA KING THE ABOVE ADDITION OF RS. 35343197/- IN ASSESSMENT YEAR 2007 -08, IN WHICH THE ASSESSEE HAS TAKEN SOME ADVANCE ONLY AND CONTRACT WAS NOT YET COMPLETED. THUS, THE ENTIRE ADDITION CONFIRMED BY LEARNED CIT(A) IS BASED ON PRESUMPTIONS, SURMISES AND CONJECTURES AN D AGAINST THE NATURAL LAW OF JUSTICE. 4. THAT THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 WITHOUT HAVING ANY GOOD REASON TO BELIEVE AND IS ILLEGAL, ARBITRARY, UNCALLED FOR AN D AGAINST THE NATURAL JUSTICE AS IT IS JUST BASED ON PRESUMPTION, SURMIS ES, SUSPICIONS ETC. AND ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 38 NEVER SUPPORTED BY ANY MATERIAL DOCUMENT OR EVIDEN CE AGAINST THE ASSESSED. 5. THE ASSESSING OFFICER HAS FAILED TO RELY ON HIS INDEPENDENT OBSERVATIONS AND ONLY RELY ON THE ASSESSMENT ORDER OF SOME OTHER ASSESSEE. 6. THAT THE ASSESSING OFFICER FAILED TO CONSIDER T HE SUBMISSIONS OF THE APPELLANT FILED DURING THE COURSE OF REASSESSM ENT PROCEEDINGS FOR THE YEAR UNDER REFERENCE. 7. THAT THE LEARNED CIT(A) HAS FURTHER ERRED IN CO NFIRMING THE INITIATION OF THE PENALTY PROCEEDINGS BY THE A.O. UNDER SECTION 271(1)(B) & 271(1)(C) OF THE INCOME TAX ACT, 1961. 8. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE , THE LD. COMMISSIONER OF INCOME TAX(APPEALS) HAS FURTHER ER RED IN CONFIRMING THE ADDITION MADE BY THE ASSESSING OFFI CER WITHOUT GIVING THE REASONABLE OPPORTUNITY TO BE HEARD TO THE ASSE SSEE. 9. THAT THE APPELLANT CRAVES, LEAVE TO ADD OR AMEN D THE GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD OR DISPOSED OF. 25. IN ITA NO.186(ASR)/2013, THE ASSESSEE HAS RAISE D FOLLOWING GROUNDS OF APPEAL: 1. THAT THE IMPUGNED ORDER IS LIABLE TO BE HELD A S BAD, INASMUCH AS, MECHANICAL APPLICATION OF HIS FINDINGS IN THE CASE OF MR. MANORANJAN KALIA, BY THE LD. CIT(A), IS PER SE ERR ONEOUS AND INCONSISTENT WITH GROUND OF APPEAL RAISED QUA THE FACTS OF THIS CASE. 2. THAT WITHOUT PREJUDICE TO ABOVE, THE LD. CIT(A) , IN THE GIVEN FACTS OF THE CASE, ERRED IN UPHOLDING THE ASSUMPTI ON OF JURISDICTION U/S 147/148. 3. THAT FAILURE ON THE PART OF LD. A.O. TO DISPOSE OF LEGAL OBJECTIONS TAKEN BY ASSESSEE, BY PASSING A SPEAKIN G ORDER, SHOULD NOT HAVE BEEN OVERLOOKED BY THE LD. CIT(A). 4. THAT THE LD. CIT(A) MISDIRECTED HIMSELF IN LAW AND ON FACTS IN CONFIRMING THE TAXATION OF NOTIONAL CAPITAL GAIN O F RS. 79,10,337/- BY WRONGLY UPHOLDING THE TRANSFER OF LAND ON THE DATE OF EXECUTION OF THE JOINT DEVELOPMENT AGREEMENT WITH THE DEVELOPERS. 5. THAT THE LD. CIT(A) OUGHT TO HAVE READ THE JOIN T DEVELOPMENT AGREEMENT IN TOTALITY, SO AS NOT TO INFER THE ACCR UAL OF CAPITAL GAIN ON THE VERY DATE OF EXECUTION OF THE SAID AGREEMENT. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 39 6. THAT THE LD. CIT(A) WRONGLY REJECTED THE ASSESS EES CLAIM THAT THE IMPUGNED CAPITAL GAIN, IF ANY, WAS ASSESSABLE ONLY IN THE HANDS OF SOCIETY AND NOT THE ASSESSEE MEMBER. 7. THAT CHARGING OF INTEREST U/S 234A & 234B HAS BEEN WRONGLY CONFIRMED. 8. THAT INITIATION OF PENALTY U/S 271(1)(C) HAS BE EN WRONGLY CONFIRMED. 9. THAT THE ORDER UNDER APPEAL IS WHOLLY AGAINST L AW AND FACTS OF THE CASE. 26. THE LD. ADDL. CIT(DR), MR. MAHAVIR SINGH INVITE D OUR ATTENTION THAT THE ISSUES IN ALL THE 24 APPEALS MENTIONED HEREINAB OVE ARE IDENTICAL TO THE ISSUES IN THE BUNCH OF 30 APPEALS DECIDED BY THE IT AT, CHANDIGARH BENCH VIDE A CONSOLIDATED ORDER DATED 29.07.2013 IN THE C ASE OF CHARANJIT SINGH ATWAL, LUDHIANA VS. ITO WARD VI(1), LUDHIANA IN ITA NO.448(ASR)/2011 AND OTHERS FOR THE ASSESSMENT YEAR 2007-08. 27. HE FURTHER INVITED OUR ATTENTION THAT IN THE PR ESENT APPEALS, THE ASSESSEES ARE EITHER PRESENT OR EX-MLAS OF PUNJAB LEGISLATIVE ASSEMBLY WHO ARE MEMBERS OF HOUSING SOCIETY. THE SAID SOCIET Y CONSISTS OF IN TOTAL 95 PRESENT OR EX-MLAS OF PUNJAB LEGISLATIVE ASSEMBLY. THE MATTER WITH RESPECT TO SOME MLAS AND THE MATTER WITH RESPECT TO THE SOCIETY ITSELF FALL UNDER THE JURSIDCTION OF CHANDIGARH ITAT AND THE RE ST UNDER THE AMRITSAR ITAT JURISDICTION. ALL THE 24 MATTERS FIXED TOD AY FOR HEARING AS MENTIONED HEREINABOVE ARE PART OF 95 PRESENT OR EX- MLAS HEREINABOVE. THE ISSUES IN THE PRESENT APPEALS ARE COMMON AND IDENTI CAL AS IN THE BUNCH OF 30 APPEALS DECIDED BY THE ITAT, CHANDIGARH BENCH (SUPR A). ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 40 28. ON THE OTHER HAND, ALL THE LD. COUNSELS APPEAR ING ON BEHALF OF DIFFERENT ASSESSEES BEFORE US IN ALL THE 24 PRESEN T APPEALS, AGREED TO THE ARGUMENT MADE BY THE LD. DR. MR. MAHAVIR SINGH. ALL THE COUNSELS PRAYED BEFORE THE BENCH TO CONSIDER THEIR WRITTEN SUBMISSI ONS AND DECIDE THE ISSUES IN ALL THE 24 APPEALS ACCORDINGLY. 29. ON PERUSING THE FACTS IN THE PRESENT 24 APPEALS BEFORE US AND THE FACTS IN THE BUNCH OF 30 APPEALS DECIDED BY A CONSOLIDATE D ORDER DATED 29.07.2013 BY THE ITAT CHANDIGARH BENCH (SUPRA) AND ON PERUSAL OF WRITTEN SUBMISSIONS PLACED ON RECORD BY DIFFERENT ARS, WE A RE OF THE VIEW THAT THE ISSUES DECIDED BY THE ITAT CHANDIGARH BENCH VIDE OR DER DATED 29.07.2013 (SUPRA) ARE IDENTICAL TO THE ISSUES IN THE PRESENT 24 APPEALS BEFORE US. THEREFORE, WE ARE PROCEEDING TO DECIDE THE PRESENT APPEALS BY THIS CONSOLIDATED ORDER AS UNDER: 30. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE WRITTEN SUBMISSIONS PLACED ON RECORD BY THE REPRESENTATIVES OF THE ASS ESSEES. THE MAIN ISSUE IN THE PRESENT APPEALS IS WHETHER THE ASSESSEE IS LIAB LE TO CAPITAL GAINS TAX IN THE IMPUGNED YEAR OR NOT. THE SAID LEGAL ISSUE HAS BEEN DEALT WITH BY THE CHANDIGARH BENCH OF ITAT IN ITS ORDER DATED 29.07.2 013 (SUPRA) IN THE CASE OF CHARANJIT SINGH ATWAL, LUDHIANA VS. ITO WARD VI (1), LUDHIANA AND IN ITA NO.448/CHD/2011 AND OTHERS VIDE ORDER DATED 29. 07.2013 (SUPRA) VIDE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 41 PARA 27 TO 44. THE FACTS IN THE CASE OF CHARANJIT S INGH ATWAL (SUPRA) IN THE LIGHT OF LEGAL POSITION IN PARA 27 TO 44 ARE DISCU SSED VIDE PARA 45 TO 51. THE LD. COUNSEL APPEARING FOR THE ASSESSEE IN THE CASE OF CHARANJIT SINGH ATWAL (SUPRA) HAS RAISED MAINLY FOLLOWING CONTENTIONS W HICH HAVE BEEN DEALT BY CHANDIGARH BENCH OF ITAT IN ITS ORDER DATED 29.07.2 013 (SUPRA) AS UNDER: I) VIDE PARA 52 TO 58 OF THE ORDER, FIRST CONTENTION WAS THAT POSSESSION WAS NOT GIVEN BY THE SOCIETY BECAUSE ACC ORDING TO HIM AS PER CLAUSE 2.1 OF THE JDA, THE POSSESSION OF THE PROPERTY WAS TO BE HANDED OVER SIMULTANEOUSLY TO THE EXECUTI ON AND REGISTRATION OF JDA AND SINCE THE JDA WAS NOT REGI STERED, THEREFORE, THE POSSESSION WAS NOT GIVEN. IT WAS HEL D BY CONSIDERING VARIOUS CONTENTIONS OF LD. COUNSELS AND LD. DR AND CASES OF VARIOUS COURTS OF LAW RELIED UPON THAT BY CONSIDERING THE PURPOSE OF INSERTION OF CLAUSE (V) AND CLAUSE (VI) OF SECTION 2(47) AND VARIOUS CLAUSES OF POWER OF ATTORNEY AND JDA, IT BECOMES ABSOLUTELY CLEAR THAT THE SOCIE TY HAS HANDED OVER THE POSSESSION OF THE SOCIETY TO THDC/H ASH AND ACCORDINGLY FIRST CONTENTION OF THE LD. DR WAS REJE CTED. II) VIDE PARA 59 TO 61 OF THE ORDER, SECOND CONTENTION WAS THAT JDA WAS EXECUTED ON 25.02.2007 AND IF POSSESSION WA S GIVEN THEN HOW THE ASSESSEE WAS HAVING POSSESSION IN TER MS OF LATER SALE DEEDS EXECUTED ON 2.3.2007 AND 25.4.2007. IT W AS HELD AFTER CONSIDERING AND ARGUMENTS OF RIVAL PARTIES AN D FACTS ON RECORD THAT MERE RECITATION IN THE SALE DEED TO THE EFFECT THAT THE SOCIETY WAS OWNER OF LAND IN POSSESSION MEASURING 2 1.2 ACRES, DOES NOT SHOW THAT THE SOCIETY WAS HAVING ACTUAL P OSSESSION. WHAT THE SOCIETY WAS HAVING IS ONLY OWNERSHIP RIGHT AND THE POSSESSION WAS ONLY CONCURRENT AS THE POSSESSORY RI GHT. ACCORDINGLY THE SECOND CONTENTION WAS ALSO REJECTED . III) VIDE PARA 62 TO 63 THE THIRD CONTENTION WAS THAT POSSESSION IF AT WAS GIVEN SHOULD BE HELD TO BE ONLY A LICENSE A S DEFINED IN SECTION 52 OF INDIAN EASEMENT ACT. THIS THIRD CONTE NTION WAS ALSO REJECTED FOR THE REASONS THAT RIGHTS GIVEN BY THE SOCIETY ARE MUCH LARGER THAN WHAT IS COVERED IN THE TERM LICEN SE. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 42 IV) VIDE PARAS 64 TO 68, THE FOURTH CONTENTION WAS THAT THE MONEY RECEIVED AT THE TIME OF EXECUTION OF JDA CAN BE TER MED, AS ADVANCE AND WHATEVER MONEY HAS BEEN RECEIVED HAS AL READY BEEN SHOWN AS CAPITAL GAIN. IT WAS HELD THAT IT IS NOT ONLY THE MONEY, WHICH IS REQUIRED TO BE TAXED BUT THE CONSI DERATION WHICH HAS ACCRUED TO THE ASSESSEE IS ALSO REQUIRED TO BE TAXED. ACCORDINGLY, THE FOURTH CONTENTION WAS ALSO REJECTE D. V) VIDE PARA 69 TO 74, FIFTH CONTENTION WAS THAT SINCE SECTION 53A OF THE TRANSFER OF PROPERTY ACT ITSELF HAS UNDERGON E AMENDMENT W.E.F. 24.9.2001 BY WHICH AGREEMENT REFERRED TO IN THAT SECTION IS REQUIRED TO BE REGISTERED AND THEREFORE, NOW IN SECTION 2(47)(V) ONLY THE AMENDED PROVISIONS CAN BE READ. I T WAS HELD THAT NON-REGISTRATION OF AGREEMENT CANNOT LEAD TO T HE CONCLUSION THAT PROVISION OF SECTION 2(47)(V) IS NOT APPLICABL E. ACCORDINGLY, FIFTH CONTENTION WAS REJECTED. VI) VIDE PARAS 75 AND 76, THE SIXTH CONTENTION WAS WITH RESPECT TO DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CHATURBHUJ DWARKADAS KAPADIA VS. CIT 260 ITR 491 IS NOT APPLICABLE. IT WAS HELD THAT THE BENCH HAS ALREADY DISCUSSED THE IMPLICATION OF THE DECISION IN THE CASE OF CHATURBH UJ DWARKADAS KAPADIA (SUPRA) IN PARA 33 TO 38 OF ITS ORDER AND A CCORDINGLY THIS CONTENTION WAS ALSO REJECTED. VIA) VIDE PARA 77 TO 86, BEING THE CONTENTION THA T IT IS NECESSARY FOR INVOKING OF SECTION 2(47)(V) OF THE ACT TO COMPLY WITH THE PROVISION OF SECTION 53A OF THE TRANSFER OF PROPERT Y ACT TO THE EXTENT THAT THERE SHOULD BE WILLINGNESS ON THE PART OF THE TRANSFEREE TO PERFORM HIS PART OF THE CONTRACT. IT WAS HELD THAT IT CANNOT BE SAID THAT THE BUILDERS WERE NOT WILLING T O PERFORM THEIR PART OF THE CONTRACT IN VIEW OF CLAUSES 4.1(I V) READ WITH CLAUSE 26(V) VII. VIDE PARA 87 AND 88, BEING THE SEVENTH CONTENTION T HAT REVENUE WRONGLY HELD THAT EVEN CLAUSE (VI) OF SECTION 2(47) IS APPLICABLE. IT WAS HELD THAT THE DEVELOPER I.E. TH DC/HASH HAS PURCHASED THE MEMBERSHIP OF THE MEMBERS IN THE SOCI ETY WHICH NOW LEAD TO THE ENJOYMENT OF THE PROPERTY AND IN TH AT TECHNICAL SENSE, CLAUSE (V) OF THE SECTION 2(47) IS APPLICABL E. VIII. VIDE PARAS 89 TO 96, BEING THE EIGHTTH CONTENTION THAT SINCE THE SOCIETY HAS TRANSFERRED THE LAND THROUGH JDA ON A P RO-RATA BASIS, THEREFORE, ONLY WHATEVER MONEY IS RECEIVED AGAINST WHICH SALE DEEDS HAVE ALSO BEEN EXECUTED CAN BE TAX ED AND ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 43 NOTIONAL INCOME I.E. THE MONEY TO BE RECEIVED LATER , CANNOT BE TAXED. IT WAS HELD THAT THERE IS NO DISPUTE THAT N O NOTIONAL INCOME CAN BE TAXED, BUT IN THE CASE OF CAPITAL GAI N SECTION 45 READ WITH SECTION 48 CLEARLY PROVIDES THAT IT IS TH E PROFIT ARISING FROM THE TRANSFER OF CAPITAL ASSET, WHICH WOULD BE SUBJECTED TO CHANGE CAPITAL GAIN TAX AND SECTION 48 CLEARLY PRO VIDES FOR TAKING THE TOTAL CONSIDERATION INTO ACCOUNT WHILE C OMPUTING THE CAPITAL GAINS, WHICH HAS ALREADY BEEN DISCUSSED IN PARAS 64 TO 68 OF THE ORDER. THEREFORE, THE WHOLE CONSIDERATION WHETHER RECEIVED OR ACCRUED WHICH HAS TO BE TAXED UNDER THE CAPITAL GAIN, ONCE THE TRANSFER OF CAPITAL ASSET TAKES PLAC E. ACCORDINGLY, THE CONTENTION WAS REJECTED. FURTHER, THE CHANDIGARH ITAT BENCH IN THE ORDER DATED 29.7.2013 (SUPRA) VIDE PARAS 97 TO 99 HAS DEALT WIT H ISSUE OF TAXABILITY OF FLAT ON THE BASIS OF ABOVE PRINCIPLES CONSIDERING CLAUSE 4 OF JDA, IT WAS HELD THAT ONCE THIS VESTED RIGHT ARISES OUT OF THE ABOVE CONTRACT, IT CAN BE EASILY SAID THAT THIS RIGHT HAS ALSO ACCRUED TO THE ASSESSEE. THEREFORE, CAPITA L GAIN TAX HAS TO BE PAID ON THE TOTAL CONSIDERATION ARISING ON TH E TRANSFER WHICH WOULD INCLUDE THE CONSIDERATION WHICH HAS BEE N RECEIVED AS WELL AS THE CONSIDERATION WHICH HAS ARISEN AND B ECOME DUE AND MAY BE RECEIVED LATER ON. ACCORDINGLY, THIS CON TENTION OF THE ASSESSEE WAS ALSO REJECTED. IX VIDE PARA 100 TO 107, BEING THE NINTH CONTENTION THAT ASSESSEE HAS ALREADY TERMINATED THE AGREEMENT AND HAS REVOK ED THE POWER OF ATTORNEY. IT WAS HELD IN VIEW OF PROVISIO N OF SECTION 45 READ WITH SECTION 48 OF THE ACT THAT SUBSEQUENT EVENTS, IF AT ALL ANY WILL NOT MAKE ANY DIFFERENCE BECAUSE TOTAL CONSIDERATION RECEIVED OR ACCRUED HAS TO BE ASSESSED IN THE YEAR OF TRANSFER. THE WORD IRREVOCABLE ITSELF SHOWS THAT IN THE E YES OF LAW SPECIAL POWER OF ATTORNEY COULD NOT HAVE BEEN REV OKED. IN VIEW OF THIS ANALYSIS, EITHER THE JDA HAS NOT BEEN CANCELLED OR IN ANY CASE THE SAME CANNOT BE CONSIDERED FOR DETE RMINING THE TAXATION OF CAPITAL GAIN. ACCORDINGLY THIS CONTENT ION WAS ALSO REJECTED. X. VIDE PARA 108 & 109, BEING THE TENTH CONTENTION THAT EVEN IF THE WHOLE CONSIDERATION HAS TO BE TAXED THEN VALUE OF THE FLATS CANNOT BE TAKEN AT RS.4500/- PER SQ.FEET. IN VIEW OF AGREEMENT BETWEEN HASH AND THDC CONSIDERATION HAS BEEN SHOW N AT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 44 RS.2000/- PER SQ. FEET FOR 126 FLATS WHEREAS IT IS RS.4500/- PER SQ. FEET FOR THREE FLATS. IT WAS HELD THAT AO HAS ESTIMATED THE VALUE OF FLATS ON MOST REASONABLE BASIS. ALSO VIDE PARA 110 THERE WAS CONTENTION WITH RESPE CT TO DEDUCTION U/S 54F OF THE ACT. IT WAS HELD THAT NO G ROUND WAS RAISED IN THE APPEAL. THOUGH REFERENCE WAS MADE IN GROUND NO.2.3 WITH REFERENCE TO SECTION 54F\ AND 54EC WHIC H ARE ON DIFFERENT FACTS AND THEREFORE DEDUCTION U/S 54F AN D 54 ARE NOT THE SAME. ACCORDINGLY, THE CONTENTION WAS REJECTED. ALSO THE SAID ISSUE HAS BEEN DISMISSED IN THE CASE OF SH.SUR INDER SINGH VS. DCIT IN ITA NO.1071/CHD/2011 VIDE PARA 166 TO 169 FOR THE REASONS MENTIONED THEREIN. 31. VIDE PARA 111 TO 113, IT WAS CONTENDED THAT CAP ITAL GAIN SHOULD HAVE BEEN TAXED IN THE HANDS OF SOCIETY WHICH IS LEGAL O WNER OF THE LAND. IT WAS HELD THAT THE FACT STANDS ADMITTED BY THE ASSESSEE BECAUSE ASSESSEE HAS FILED A RETURN DECLARING CAPITAL GAIN AGAINST PART MONEY RE CEIVED AGAINST THE PLOT. THUS, IT BECOMES CLEAR THAT IT IS THE INDIVIDUAL ME MBER WHO ARE LIABLE TO TAX IN RESPECT OF TRANSFER OF PLOTS AND THE SOCIETY BEI NG ONLY A FACILITATOR OR POST OFFICE. ACCORDINGLY, THIS CONTENTION WAS ALSO REJEC TED. 32 VIDE PARAS 5 TO 9 ALSO THE ASSESSEE HAS RAISED THE ADDITIONAL EVIDENCE, WHICH AFTER CONSIDERING THE FACTS ON RECORD AND ARG UMENTS OF LD. COUNSELS ALLOWED THE ADMISSION OF ADDITIONAL EVIDENCE. 33 VIDE PARA 10 TO 14, THE REVISED RETURN WAS TREAT ED AS NON-EST AND IT WAS HELD THAT NO DISADVANTAGE HAS OCCURRED TO THE A SSESSEE BECAUSE IN THE REVISED RETURN, THE ASSESSEE HAS INCLUDED A SUM OF RS.27,58,436/- ON ACCOUNT OF CAPITAL GAIN AND THE WHOLE DISPUTE IN THE ASSESS MENT RELATES TO CAPITAL ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 45 GAIN ARISING OUT OF SALE OF PLOT IN THE ASSESSMENT RELATING TO CAPITAL GAIN ARISING OUT OF SALE OF PLOT IN PUNJABI CO-OPERATIVE HOUSING BUILDING SOCIETY LTD. MOHALI. IN FACT, THE AO HAS ULTIMATELY ASSESSE D MUCH HIGHER AMOUNT OF CAPITAL GAIN, WHICH THE ASSESSEE IS DISPUTING. ACCO RDINGLY, THIS GROUND OF THE ASSESSEE WAS REJECTED. ACCORDINGLY ALL THE ISSU ES, AS DISCUSSED ABOVE IN THE CASE OF SH.CHARANJIT SINGH ATWAL (SUPRA) WERE DISMISSED BY THE ITAT CHANDIGARH BENCH IN ITS ORDER DATED 29.07.2013. 34. AS REGARDS ISSUE OF NOTICE U/S 148, THE SAME WAS DEALT WITH IN ITA NO.986/CHD/2011 IN THE CASE OF AVTAR SINGH BRAR VS. ITO. IT WAS HELD THAT LD. CIT(A) HAS DONE NO WRONG IN REJECTING THE ISSU E ON REOPENING OF ASSESSMENT. ACCORDINGLY, THE GROUND WAS REJECTED. 35. IN THE CASE OF SMT. SURJIT KAUR IN ITA NO.993/ CHD/2011, THE ASSESSEE WAS A MEMBER OF THE DEFENCE SERVICES CO-O PERATIVE HOUSING BUILDING SOCIETY LTD; WHICH WAS THE OWNER OF 27.3 A CRES OF LAND. THIS LAND WAS TRANSFERRED TO THDC/HASH AS IN THE CASE OF PUN JABI CO-OPERATIVE HOUSING BUILDING SOCIETY LTD; EITHER FACTS ARE IDEN TICAL TO THE CASE OF SH. CHARANJIT SINGH ATWAL (SUPRA). ACCORDINGLY, BEING I DENTICAL ISSUE AS IN THE CASE OF SH.CHARANJIT SINGH ATWAL (SUPRA), THE APPEA L OF THE ASSESSEE WAS DISMISSED. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 46 36. REGARDING INTEREST U/S 234B AND WITHDRAWAL U/S 244A, IT WAS HELD IN PARA 114 THAT THE SAME IS CONSEQUENTIAL IN NATURE A ND AO WAS DIRECTED TO CHARGE OR WITHDRAW INTEREST IN ACCORDANCE WITH LAW . 37. ACCORDINGLY, ALL THE GROUNDS AND CONTENTIONS RA ISED IN 30 APPEALS AS MENTIONED HEREINABOVE BY THE ITAT, CHANDIGARH BENC H HAVE BEEN DISMISSED. FOR THE SAKE OF CONVENIENCE, WE REPRODU CE THE FACTS IN THE CASE OF SH. CHARANJIT SINGH ATWAL VS ITO IN ITA NO.448(C HD/2011 AND THE FINDINGS OF THE ITAT, CHANDIGARH BENCH ON THE ISSUE S IN THE APPEAL VIDE PARAS 17 TO 115 AS UNDER: 17 BRIEF FACTS OF THE CASE ARE THAT WHILE MAKING DI SCREET ENQUIRIES IN THE CASES OF HOUSING SOCIETIES, IT WA S GATHERED THAT HOUSING SOCIETY CONSISTING OF 95 PRE SENT AND EX-MLAS OF PUNJAB LEGISLATIVE ASSEMBLY IS OWNE R OF THE 21.2 ACRES OF LAND IN VILLAGE KANSAL, DISTT. M OHALI. THE VILLAGE KANSAL SHARES ITS BOUNDARY WITH CAPITA L CITY OF CHANDIGARH. ON 25.2.2007 THE HOUSING SOCIETY OF M LAS ENTERED INTO A TRIPARTITE JOINT DEVELOPMENT AGREEM ENT (HEREIN AFTER REFERRED AS JDA) WITH HASH BUILDER S (P) LTD (HEREINAFTER REFERRED TO HASH) AND M/S TATA HOUSING DEVELOPMENT COMPANY LTD. (HEREINAFTER REFERRED AS THDC). BY VIRTUE OF THIS TRIPARTITE AGREEMENT IT WAS AGREED UPON AMONG THESE PARTIES THAT THE SOCIETY W HICH IS OWNER OF 21.2 ACRES OF LAND, SHALL TRANSFER ITS LAND TO THDC/HASH IN LIEU OF MONETARY CONSIDERATION AND CONSIDERATION IN KIND. AS PER THE AGREEMENT EACH MEMBER OF THE SOCIETY HAVING A PLOT OF 500 SQYD IN THE SO CIETY WAS TO RECEIVE MONETARY CONSIDERATION OF RS. 82,50 ,000/- AND THE MEMBERS HOLDING PLOT OF 1000 SQYD WAS TO R ECEIVE A SUM OF RS. 1.65 CRORES. IN ADDITION TO THIS MEMB ER HOLDING A PLOT OF 500 SQYD WAS TO RECEIVE FULLY FU RNISHED FLAT MEASURING 2250 SQFT TO BE CONSTRUCTED BY THDC /HASH AND MEMBERS HAVING 1000 SQYD WERE TO GET TWO SUCH FLATS. ACCORDING TO THE ASSESSING OFFICER TOTAL CONSIDERATION TO BE RECEIVED BY ALL THE MEMBERS WA S RS. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 47 1,06,42,35,000/- AND FURNISHED FLATS AS MENTIONED ABOVE. BEFORE ENTERING INTO THE TRIPARTITE AGREEMENT THE SOCIETY IN ITS EXECUTIVE COMMITTEE MEETING HELD ON 4.01.20 07 WHICH WAS APPROVED IN THE GENERAL BODY MEETING HEL D ON 26.2.2007, PASSED A RESOLUTION TO THE EFFECT THAT ALL THE MEMBERS WOULD SURRENDER THEIR ALL RIGHTS IN THE PR OPERTY TO THE SOCIETY AND THE SOCIETY WOULD ENTER INTO AN AGREEMENT ON BEHALF OF THE MEMBERS WITH THDC/HASH. THE ASSESSING OFFICER HAS REFERRED TO THIS RESOLUT ION AS WELL AS VARIOUS IMPORTANT CLAUSES OF THE JDA AND H AS PLACED LOT OF RELIANCE ON CLAUSE 2.1 OF THE JDA WH ICH IS AS UNDER: THE OWNER HEREBY IRREVOCABOY AND UNEQUIVOCALLY GRANTS AND ASSIGNS IN PERPETUITY ALL ITS RIGHTS TO DEVELOP, CONSTRUCT, MORTAGE, LEASE, LICENSE SELL AN D TRANSFER THE PROPERTY ALONG WITH ANY AND ALL THE CONSTRUCTIONS, PREMISES, HEREDITAMENTS, EASEMENTS, TREES THEREON IN FAVOUR OF THDC FOR THE PURPOSE OF DEVELOPMENT, CONSTRUCTION, MORTGAGE, SALE, TRANSFER , LEASE, LICENSE AND/OR EXPLOITATION FOR FULL UTILIZA TION OF THE PROPERTY (RIGHTS) AND TO EXECUTE ALL THE DOCUMENTS NECESSARY TO CARRY OUT, FACILITATE AND ENFORCE THE RIGHTS IN THE PROPERTY INCLUDING TO EXECUTE LEASE AGREEMENT. LICENSE AGREEMENTS, CONSTRUCTION CONTRACTS, SUPPLIE R CONTRACTS, AGREEMENT FOR SALE. CONVEYANCE, MORTGAG E DEEDS, FINANCE DOCUMENTS AND ALL DOCUMENTS AND AGREEMENTS NECESSARY TO CREATE AND REGISTER THE MORTGAGE, CONVEYANCE, LEASE DEEDS, LICENSE AGREEMEN T, POA, AFFIDAVITS, DECLARATIONS, INDEMNITIES AND ALL SUCH OTHER DOCUMENTS, LETTERS AS MAY BE NECESSARY TO CAR RY OUT, FACILITATE AND ENFORCE THE RIGHTS AND TO REGIS TER THE SAME WITH THE REVENUE/COMPETENT AUTHORITIES AND TO APPEAR ON OUR BEHALF BEFORE ALL AUTHORITIES, STATUT ORY OR OTHERWISE AND BEFORE ANY COURT OF LAW (THE DEVELOP MENT RIGHTS). THE OWNER HEREBY HANDS OVER THE ORIGINAL TITLE DEEDS OF THE PROPERTY AS MENTIONED IN THE LIS T ANNEXUED HERETO AND MARKED AS ANNEXURE IV AND PHYSICAL, VACANT POSSESSION OF THE PROPERTY HAS BEE N HANDED OVER TO THDC SIMULTANEOUSLY TO THE EXECUTION AND REGISTRATION OF THIS AGREEMENT TO DEVELOP THE S AME AS SET OUT HEREIN. 18 IT WAS FURTHER NOTICED THAT TILL DATE A MEMBER HAVING 500 SQYD PLOT IN SOCIETY HAD RECEIVED RS. 33.00 LA KHS EACH AND A MEMBER HAVING 1000 SQYD PLOT HAD RECEIV ED ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 48 RS. 66.00 LAKH. THE ASSESSEE WAS ALSO A MEMBER AN D PRESIDENT OF THE SOCIETY AND WAS OWNER OF A PLOT MEASURING 1000 SQYD. THEREFORE, AS PER JDA, HE W AS TO RECEIVE RS. 1.65 CRORES AS MONETARY CONSIDERATION AND TWO FURNISHED FLATS AS CONSIDERATION IN KIND AND T HE COST OF THE SAME AS PER ASSESSING OFFICER WAS RS. 2,02,50,000/- AND TOTAL CONSIDERATION WOULD BE RS. 3,67,50,000/-. 19 ACCORDING TO THE ASSESSING OFFICER SINCE THE SOCIETY HAS ASSIGNED ALL RIGHTS IN 21.2 ACRES OF L AND BELONGING TO THE SOCIETY IN TERMS OF JDA TO THDC/H ASH AND ALSO HANDED OVER THE PHYSICAL VACANT POSSESSIO N OF THE PROPERTY TO THDC/HASH, THEREFORE, THE ASSESSE E BECAME LIABLE TO CAPITAL GAIN TAX ON HIS SHARE OF CONSIDERATION. ACCORDINGLY A LETTER DATED 7.12.2 008 WAS ISSUED INTIMATING THE ASSESSEE THAT AFTER CONSIDER ATION OF THE VARIOUS CLAUSES OF JDA DATED 25.2.2007 AND THE RESOLUTION PASSED BY THE SOCIETY ON 26.2.2007, CAP ITAL GAIN WAS TO BE CHARGED IN THE HANDS OF THE ASSESSE E IN ASSESSMENT YEAR 2007-08 BY TAKING FULL VALUE OF TH E CONSTRUCTION AT RS. 3,67,50,000/-. THE ASSESSEE F ILED VARIOUS REPLIES WHICH HAVE BEEN EXTRACTED BY THE ASSESSING OFFICER AS UNDER: THIS HAS REFERENCE TO YOUR LETTER DATED 7.12.2009, WE SUBMITTED THAT UNDER: 1 THE AGREEMENT UNDER REFERENCE IS ONLY IN THE NAT URE OF AN AGREEMENT TO SELL AND NOT A SALE DEED AND THEREFORE NO CAPITAL GAIN CAN ARISE UNDER THE SAID AGREEMENT. THE AMOUNTS RECEIVED UNDER THE SAID AGREEMENT ARE A CTUALLY THE ADVANCES RECEIVED AND NOT THE SALE CONSIDERATI ON AND THE LAND TRANSFERRED IN FAVOUR OF THDC LTD. IS ONLY ON ACCOU NT OF SECURITY. A LETTER FROM M/S HASH BUILDERS TO THAT EFFECT IS ENC LOSED HEREWITH. THERE ARE MANY CONDITIONS ENVISAGED IN THE AGREEMEN T WHICH NEED TO BE FULFILLED BEFORE THE FULL EXECUTION OF THE AGREE MENT AND TRANSFER OF PROPERTY TO THDC LID. AND RECEIPT OF THE CONSIDERAT ION. 4 UNDER THE PARTIAL EXECUTION, THE PART OF PROPERTY MEASURING APPROX, 72 SQ YARDS WAS REGISTERED IN FAVOUR OF THDC AND SUM OF RS. 12 LACS WAS RECEIVED AS STATED EARLIER, THE AMOUNT WAS RECEIVED AS ADVANCE UNDER THE AGREEMENT AND THE PROPERTY WAS TR ANSFERRED AS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 49 SECURITY TOWARDS THAT ADVANCE. THERE WERE DIFFERE NT LEGAL OPINIONS ON THE TAXABILITY OF THE AMOUNTS RECEIVED. HOWEVER IN DISCHARGE OF THE DUTIES AS RESPONSIBLE CITIZENS AND AVOID LITIGATION, THE MEMBERS DECIDED TO PAY CAPITAL GAIN TAX ON THE AMOUNTS RECEIVED VOLUNTARILY AND SUCH AS THE ASSESSEE HAS P AID DUE AMOUNT OF TAXES VOLUNTARILY DURING THE COURSE OF PR OCEEDINGS IT MAY KINDLY BE APPRECIATED THAT TAX LIABILITY WILL ARISE ONLY TO EXTENT OF COMPLETED TRANSACTIONS I.E. THE CAPITAL GAIN ARISING ON THE LAND WHICH HAS BEEN TRANSFERRED AND FOR WHICH CONSIDERATION HAS BEEN RECEIVED. THE ASSESSEE HAS F ULLY DISCHARGED HIS LIABILITY TO THAT EXTENT THERE CANNOT BE ANY TA X LIABILITY ON INCOMPLETE TRANSACTION I.E. WHERE THE LAND HAS NOT BEEN TRANSFERRED AND THE CONSIDERATION HAS NOT BEEN RECEIVED, 5 IN YOUR LETTER UNDER CONSIDERATION, YOU HAVE CONSIDERED THE NATIONAL 'VALUE OF THE PROPOSED FLAT MEASURING 2250 SQ. FEET AS A PART OF THE CONSIDERATION HERE THE FOLLOWING POINTS NEED TO BE CONSIDERED. 1.) THE FLAT SHALL BE GIVEN ONLY AFTER THE FULL LAN D I.E. 500 SQ. YARD, HAS BEEN TRANSFERRED TO THE BUYER. 2) THERE IS NO PROVISION IN THE AGREEMENT TO ALLOT PRO PORTIONATE FLAT OR MAKE EQUIVALENT PROPORTIONATE PAYMENT. SO F OR THE PRESENT TRANSACTION WHERE ONLY A PART OF THE LAND H AS BEEN TRANSFERRED, NO CONSIDERATION ON ACCOUNT OF FLAT IS AVAILABLE. SO NO QUESTION OF ANY TAX LIABILITY ARISE. 3) IT MAY KINDLY BE APPRECIATED THAT THE DEVELOPER HAS NOT EVEN ' ACQUIRED THE LAND TILL DATE AND HAS NOT EVEN OBTAINED PERMISSION TO START DEVELOPMENT. SO THERE IS NO QUE STION OF ANY CONSTRUCTION OF FIATS NOW OR NEAR FUTURE THAT I S TO SAY, THERE IS NO CAPITA! ASSET IN EXISTENCE AS ON DATE FOR WHICH THE NATIONAL VALUE CAN BE CONSIDERED. 4) CLAUSE NO 14 IS TERMINATION CLAUSE OF THE AGR EEMENT UNDER REFERENCE (COPY ENCLOSED), VERY CLEARLY STA TES THE RIGHTS OF THDC TO TERMINATE THE AGREEMENT AND IN TH AT SITUATION, THE LAND ALREADY TRANSFERRED TO THDC WILL BE RETAIN ED BY THEM AND NO FURTHER LAND WILL BE PURCHASED BY THDC AND NO FU RTHER PAYMENT SHALL BE MADE BY THEM. IN THAT EVENT THE AMOUNT REC EIVED BY ASSESSEE WILL BE CONSIDERED AS FULL, AND FINAL CONS IDERATION. SO THERE IS NO QUESTION OF CONSIDERING THE NATIONAL VA LUE OF PROPOSED FLAT AS THE UNREALIZED CONSIDERATION FOR T HE PURPOSE OF CAPITAL GAIN OF THE ASSESSEE. THE ASSESSEE IS A HON 'BLE CITIZEN AND REGULAR INCOME TAX PAYEE AND SHALL DISCHARGE HIS LI ABILITY UNDER INCOME TAX WHEN THE WHOLE LAND WILL BE TRANSFERRED. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 50 5.) WHILE MAKING THE CALCULATION OF CAPITAL GAIN TA X, THE AMOUNT OF CONSIDERATION HAS BEEN WRONGLY TAKEN OF RS. 15 LACS INSTEAD OF RS,12 LACS. AS PER THE AGREEMENT, SUM OF RS. 3 LACS IS ADJUSTABLE ADVANCE. YOU ARE REQUESTED TO KINDLY RE COMPUTED TAX LIABILITY, 6.) THERE ARE VARIOUS JUDGMENTS ON THIS ISSUE. THE FOLLOWING CASES ARE ENCLOSED HEREWITH FOR THE REFERENCE. A. CIT VS. ATAM PRAKASH & SONS (2008) 219 CTR (DEL) B. SMT. RAJ RANI DEVI RAMNA VS. CIT (1993) 201 ITR 1032 (PAT) C. ZUARI ESTATE DEVELOPMENT & INVESTMENTS CO. (P) LTD. VS. J.R.KANEKAR, DEPUTY CIT. (2004) 191 CTR (BOM) IN VIEW OF THE ABOVE YOU ARE REQUESTED TO KINDLY CO NSIDERATION THE CAPITA! GAIN AS SUBMITTED BY US.' 9. THE CASE WAS FURTHER FIXED FOR 24.12.2009, ON THE SAID DATE THE COUNSEL OF THE ASSESSEE FIFED ANOTHER REPL Y WHICH IS REPRODUCED AS UNDER: 1AS PER PARA 6.1 OF YOUR LETTER, YOU HAVE MENTIONED THAT THERE IS A TRANSFER OF PROPERTY UPON THE SURRENDER OF ALL OTMENT RIGHTS. YOU MAY KINDLY REFER TO THE AGREEMENT DATED 25,02.2007 WHEREIN IT IS CLEARLY MENTIONED THAT ALL OTMENT RIGHTS HAVE BEEN SURRENDERED BY THE MEMBERS IN FAVO UR OF THE OWNER I.E. 'PUNJABI CO-OPERATIVE HOUSE BUILDING , SOCIETY LTD' AND NOT IN FAVOUR OF THE BUYERS. SO THEREFORE, THERE IS NO TRANSFER OF PROPERTY U/S 2(14) AND 2(47). 2REGARDING YOUR OBSERVATION OF HAVING ACCEPTED THE POSITION OF TRANSFER, PLEASE NOTE THAT WE UNDERSTAND THAT TR ANSFER OF PROPERTY IS ONLY TO THE EXTENT OF THE LAND TRANSFER RED BY WAY OF SALE DEED. 3 IT IS VERY CLEAR FROM THE AGREEMENT THAT NO TRANSFER OF PROPERTY HAVE TAKEN PLACE ONLY THE DEVE LOPMENT RIGHT HAS BEEN TRANSFERRED. THEREFORE, THERE IS NO TRANSFER OF PROPERTY UNDER SECTION 53A OF TRANSFER OF PROPERTY ACT, ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 51 4. CLAUSE 9.3 OF THE AGREEMENT IS VERY CLEAR LY STATING THAT THE OWNERSHIP HAS NOT BEEN TRANSFERRED. IN VIEW OF OUR SUBMISSION YOU ARE REQUESTED TO COMP LETE THE CAPITA! GAINS TAX IN ACCORDANCE WITH OUR RETURN. TH E ASSESSEE WANTS TO BE PERSONALLY HEARD AND MAKE FURT HER SUBMISSION. YOU ARE REQUESTED TO KINDLY ADJOURN THE CASE TILL 29-12-2009.' 11. VIDE THE ABOVE SAID LETTER THE ASSESSEE REQUE STED TO BE PERSONALLY HEARD HOWEVER ON 29.12.2009 HE DID NOT A PPEAR. THE COUNSEL OF THE ASSESSEE FILED WRITTEN SUBMISSION WH ICH IS REPRODUCED AS UNDER: 1 IN PARA 6,1 OF YOUR LETTER DATED 7.12.2009, YOU HAVE WRITTEN THAT THERE IS GRANT AND ASSIGNMENT OF DEVELOPMENT RIGHTS IN THE PROPERTY AND THERE IS TRA NSFER OF PROPERTY UPON THE SURRENDER OF ALLOTMENT RIGHT. THI S IS NOT A TRUE FACTUAL POSITION. THE ALLOTMENT RIGHTS HAVE NOT BEEN SURRENDERED BY THE MEMBERS IN FAVOUR OF THDC LTD OR M/S HASH BUILDERS LTD. THE FACTUAL POSITION IS THAT THE SOCIETY I.E. M/S PUNJABI CO-OP HOUSE BLDG. SOCIETY LTD. HAS ENTERED INTO AN AGREEMENT WITH M/S THDC LID. M/S HA SH BUILDERS LTD. AS PER CLAUSE 2.1 OF THE AGREEMENT IT IS VERY CLEARLY MENTIONED THAT THE POSSESSION OF THE PROPERTY HAS BEEN HANDED OVER TO THDC LTD. ONLY TO DEVELOP THE SAME. A CLOSE EXAMINATION OF THE AGREEMENT CLEA RLY REVEALS THAT THE AGREEMENT IS A JOINT DEVELOPMENT AGREEMENT. THE SOCIETY INTENDED TO DEVELOP THE LAND OWNED BY IT. HOWEVER SINCE THE REQUISITE EXPERTISE WERE N OT AVAILABLE WITH THE SOCIETY, THE OTHER TWO DEVELOPERS WERE INVOLVED IN THE PROJECT. THE COST O F DEVELOPMENT WAS TO BE BORNE BY THE THDC. THE PAYMEN T TO THE SOCIETY WAS TO BE MADE PRO-RATA ON TRANSFER OF LAND IN FAVOUR OF THDC LTD, IT IS VERY CLEAR FROM THE AGREE MENT THAT NO CONSIDERATION WAS PAYABLE TO THE ASSESSEE UNLESS THE LAND WAS TRANSFERRED. SO THERE IS A CLEAR CUT RELAT ION BETWEEN THE LAND TRANSFER AND CONSIDERATION. NO CONSIDERATION WILL BE RECEIVED IF THE LAND IS NOT T RANSFERRED. AS FAR AS THE POSSESSION AS MENTIONED IN THE AGREEM ENT IS CONCERNED, THE SAME IS FOR DEVELOPMENT ONLY AND THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 52 TERMINATION CLAUSE VERY CLEARLY STATES THAT IF THE AGREEMENT IS TERMINATED, THDC LTD WILL RETAIN ONLY THAT MUCH LAN D WHICH HAS BEEN TRANSFERRED TO THEM AND THE REMAINING LAND WILL BE RETAINED BY THE SOCIETY/MEMBERS. THE ACTUAL POSITIO N IS SUCH THAT NO DEVELOPMENT WORK HAS TILL DATE BEEN UN DERTAKEN BY THE THDC LID BECAUSE THE VARIOUS CONDITIONS STIP ULATED IN THE AGREEMENT HAVE NOT BEEN FULFILLED. THE POSSE SSION AS MENTIONED IN THE AGREEMENT AND WHICH IS BEING MADE THE BASIS BY YOU TO CONSIDER THE TRANSACTION AS TRANSFE R U/S 53A OF THE TRANSFER OF PROPERTY ACT IS ACTUALLY NOT OF ANY CONSEQUENCES AND ACTUALLY THERE IS NO TRANSFER EXCE PT TO THE EXTENT OF LAND TRANSFERRED BY WAY OF REGISTERED SAL E-DEED. 2 CLAUSE 6.1 OF THE AGREEMENT CLEARLY STATES THAT HANDING OVER THE ORIGINAL TITLE -DEEDS IS AS SECURI TY FOR THE ADJUSTABLE ADVANCE. 3 AS PER CLAUSE 9.2 OF THE AGREEMENT, IT IS V ERY CLEARLY MENTIONED THAT THE OWNER SHALL EXECUTE IN F AVOUR OF M/S THDC LTD: THE SALE-DEEDS TO COMPLE TE THE AFORESAID TRANSACTION. SO IT IS EVIDENT THAT THE EXECUTION OF SALE-DEEDS IS AN INTEGRAL PART OF THE TRANSACTION A ND THE TRANSACTION SHALL REMAIN INCOMPLETE. IF THE SALE DE EDS ARE NOT EXECUTED. 4 THE CLAUSE 13 VERY CLEARLY STATES THAT TH E RIGHTS TRANSFERRED RELATE TO DEVELOPMENT/CONSTRUCTION WORK AND M/S THDC LTD SHALL NOT DO ANYTHING WHICH ADVERSELY AFFE CT THE RIGHT OF THE OWNER TO RECEIVE THE ENTIRE CONSIDERAT ION. 5 KEEPING IN VIEW THE CONDITIONS IN THE AGREEMENT AND TO THE FACT THAT M/S THDC LTD: M/S HASH BUILDER LTD HAVE NOT DONE ANY DEVELOPMENT WORK ON THE LAND UNDER CONSIDERATION TILL DATE IN PURSUANCE OF THE AGREEME NT DATED 25.2.2007 OR IN FURTHERANCE OF THE SAID AGREEMENT, NO TRANSFER SHOULD BE CONSIDERED TO HAVE BEEN TAKEN PL ACE IN RESPECT OF THE LAND WHICH IS NOT YET TRANSFERRED, IF THE VIEWS OF THE DEPARTMENT ARE HELD TO BE CORRE CT FOR THE SAKE OF DISCUSSION, THE FOLLOWING SITUATION WILL ARISE: 1, ASSESSES WILL BE DEPRIVED FROM AVAILING THE EXEM PTION U/S 54EC SINCE NO FUNDS ARE AVAILABLE WITH THE ASSESSEE FOR INVESTMENT. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 53 2, ASSESSEE WILL BE DEPRIVED FROM AVAILING EXEMPTIO N U/S 54F AS NO RESIDENTIAL HOUSE HAS YET BEEN CONSTRUCTED. THIS IS AN IRONICAL SITUATION WHERE ASSESSEE IS HAV ING TO PAY TAX ON THE NOTIONAL VALUE OF THE FLAT TO BE GIVEN IN THE F UTURE TO HIM AS CONSIDERATION BUT EXEMPTION UNDER SECTION 54F WILL BE DENIED BECAUSE THE RESIDENTIAL HOUSE DID NOT EXIST, 3. FURTHER AS PER THE TERMINATION CLAUSE OF THE A GREEMENT VARIOUS CONDITIONS HAVE BEEN PRESCRIBED UNDER WHICH THE AGREEMENT CAN BE TERMINATED. IT IS VERY CLEARLY MEN TIONED IN THE AGREEMENT THAT IN THE EVENT OF TERMINATION OF THE A GREEMENT THE LAND TRANSFERRED BY THE MEMBERS WILL BE RETAINED BY THDC LTD AND CONSEQUENTLY NO FURTHER CONSIDERATION SHALL BE GIVEN TO THE MEMBERS. IT IS EVIDENT FROM THE FACTS IN THE CASE T HAT INORDINATE DELAY HAS ALREADY TAKEN PLACE IN THIS CASE. THE AGR EEMENT WAS ORIGINALLY ENVISAGED TO BE FULLY EXECUTED IN F.Y 20 07-08. BUT NOW EVEN FY 2009-10 IS ALSO GOING TO EXPIRE. IN THA T CASE THE ASSESSEE WILL HAVE NO REMEDY AVAILABLE AGAINST THE TAX PAID ON CONSIDERATION WHICH WILL NEVER BE RECEIVED BY HIM. UNDER SUCH CIRCUMSTANCES IT WILL BE FULLY UNLAWFUL TO CHARGE T AX. 4. THE VALUE OF PROPOSED FLAT IS UNDETERMINABLE A ND THERE IS NO WAY TO DETERMINE THE SAME. THERE IS NO PROVISION TO PAY TAX ON THE NOTIONAL VALUE. CLAUSE 6.18 OF THE AGREEMENT ENTITLED THE ASSESSEE TO SURRENDER HIS PROPOSED FLAT TO THDC LTD . AND IN THAT CASE ONLY 75% OF THE FUTURE MARKET-PRICE WILL BE RE CEIVED BY HIM. IN THE LIGHT OF ABOVE DISCUSSION IT IS ONCE AGAIN R EQUESTED THAT TAX MAY BE CALCULATED AS PER THE RETURN FILED BY THE AS SESSEE. HOWEVER IF THE DEPARTMENT CHOOSE TO DISAGREE WITH O UR SUBMISSIONS THEN IT IS SUBMITTED THAT THE CAPITA! G AIN SHOULD BE CHARGED IN THE HANDS OF THE PUNJABI CO-OPERATIVE HO USE BLDG. SOCIETY. IT WILL BE PERTINENT TO NOTE HERE THAT T HE PROCEEDINGS IN THE CASE OF THE SOCIETY HAVE BEEN REOPENED U/S 148 OF T HE I.T ACT 1961 BY THE LEARNED D.C.I.T MOHALI. IN THE REASONS RE CORDED BY THE LEARNED D.C.I.T, IT HAS CLEARLY BEEN MENTIONED THAT HE PROPOSES TO TAX THE CAPITAL-GAIN IN THE HANDS OF THE SOCIETY. COPY OF THE REASONS RECORDED IS ENCLOSED. IT MAY BE APPRECIATE D THAT THE SAME AMOUNT CAN'T BE TAXED TWICE'. ON 29,12,2009 AGAIN THE COUNSEL OF THE ASSESSEE FIL ED A LETTER AND SUBMITTED AS UNDER: ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 54 'THIS BEING REFERRED TO THE CAPTIONED PROCEEDINGS R EGARDING YOUR QUERY ABOUT THE COST OF ACQUISITION IS RS. 11 LACS WHICH IS PAID AS PER FOLLOWING DATES. RECEIPT NO, 307 09-11-01 5,04,000/- RECEIPT NO. 426 12-02-04 7,00,007/- OUT OF ABOVE AMOUNT RS. 1,00.000/- WAS REFUNDED TO THE ASSESSEE AND RS, 4000/- WAS TOWARDS MEMBERSHIP CHAR GES AND OTHER FUNDS OF THE SOCIETY. IN CONTINUATION TO OUR EARLIER REPLY SUBMITTED, WE ONCE AGAIN REITERATE THAT THE POSSESSION GIVEN BY THE ASSESSEE IS ONLY TO THE EXTENT OF LAND SOLD BY WAY OF REGISTERED SALE DEED. THERE ARE CERTAIN ADDENDUMS TO THE AGREEMENT WHICH ARE NOT PR ESENTLY AVAILABLE WITH THE ASSESSEE & CANNOT BE SUBMITTED I MMEDIATELY. 20 THE ASSESSING OFFICER AFTER CONSIDERING THE SUBMISSIONS DID NOT FIND ANY FORCE IN THE SAME AND OBSERVED AS UNDER: (I) THERE IS NO FORCE IN THE ARGUMENT THAT THE JDA WAS ONLY AN AGREEMENT TO SELL AND NOT A SALE DEED BECA USE JDA RESULTED IN THE TRANSFER OF ASSETS. ALL THE I NGREDIENTS OF TRANSFER I.E. CONSIDERATION FROM SCHEDULE OF PA YMENTS, RIGHTS AND LIABILITIES OF THE PARTIES ETC. WERE ME NTIONED IN THE JDA, CAPITAL GAIN AROSE BECAUSE OF THE FACT TH AT IT WAS A CASE OF TRANSFER OF CAPITAL ASSET IN VIEW OF SECTION 2(47)(II), 2(47)(V) AND 2(47)(VI). ACCORDING TO H IM AS PER CLAUSE 2.1 OF THE JDA OWNER OF THE LAND MADE AGREE MENT AND IRREVOCABLY AND UNEQUIVOCALLY GRANTED AND ASS IGNED IN PERPETUITY ALL OF ITS RIGHTS TO DEVELOP, CONSTR UCT, MORTGAGE, LEASE, LICENSE, SELL AND TRANSFER THE PR OPERTY (21.2 ACRES OF LAND) ALONG WITH ANY AND ALL CONSTR UCTIONS TREES ETC. IN FAVOUR OF THDC/HASH FOR THE PURPOSE OF DEVELOPMENT, CONSTRUCTION, MORTGAGE, SELL, TRANSFE R, LEASE, LICENSE AND/OR EXPLOITATION FOR FULL UTILIZ ATION OF THE PROPERTY AND TO EXECUTE ALL DOCUMENTS NECESSARY TO CARRY OUT FACILITIES AND RIGHTS IN THE PROPERTY. THUS T RANSFER OF PROPERTY WAS EFFECTED THROUGH THIS AGREEMENT. (II) THE OWNER HAD ALSO HANDED OVER THE ORIGINAL T ITLE DEEDS OF THE PROPERTY AND ALSO HANDED OVER THE PHY SICAL, VACANT POSSESSION OF THE PROPERTY TO THDC/HASH SIMULTANEOUSLY TO THE EXECUTION AND REGISTRATION O F THIS JDA AND THEREFORE, THE CASE OF THE ASSESSEE WAS C OVERED ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 55 BY THE PROVISIONS OF SECTION 2(47)(V) OF THE ACT R .W.S 53A OF T.P. ACT. AS PART CONSIDERATION HAD ALSO BEEN R ECEIVED. ACCORDING TO THE ASSESSING OFFICER THE FACTS OF TH E CASE WERE SIMILAR TO THE FACTS IN CASE OF CIT V. K. JEE LANI BASHA, 256 ITR 282 (MAD) WHEREIN HON'BLE HIGH COUR T AFTER ANALYZING THE PROVISIONS OF SECTION 2(47)(V) HAD HELD THAT ONCE THE POSSESSION EVEN FOR A PART OF THE PR OPERTY WAS HANDED OVER TO THE TRANSFEREE, FOR THE PURPOSE OF SECTION 2(47)(V) R.W.S 45, THE TRANSFER WAS COMPLE TE. (III) THE ASSESSEES CASE WAS ALSO COVERED BY THE PROVISIONS OF SECTION 2(47)(VI) WHICH DEALS WITH A NY TRANSACTION WHICH HAD EFFECT OF TRANSFERRING OR EN ABLING THE ENJOYMENT OF ANY IMMOVABLE PROPERTY AND ASSIGN ING VARIOUS RIGHTS IN THE PROPERTY IN FAVOUR OF THDC AND HANDING OVER THE ORIGINAL TITLE DEEDS AS WELL AS H ANDING OVER OF THE PHYSICAL VACANT POSSESSION OF LAND HAS THE EFFECT OF TRANSFERRING OR ENABLING THE ENJOYMENT O F THE SAID PROPERTY TO THDC/HASH. (IV) THERE WAS NO FORCE IN THE CONTENTION THAT THE AMOUNTS RECEIVED UNDER THE SAID AGREEMENT WERE ADVANCES RECEIVED AND NOT THE SALE CONSIDERATION BECAUSE TOTAL CONSIDERATION WAS STRUCTURED IN THE JDA AND THE CONSIDERATION WAS TO BE RECEIVED AS PER CLAUSE 4(IV) OF THE JDA. IN FACT THE ASSESSEE HAS HIMSELF SHOW N THE RECEIPT AND RETURNED THE SAME AS CAPITAL GAIN WHIC H CONTRADICTS THESE ARGUMENTS OF THE ASSESSEE. AS P ER SECTION 45 OF IT ACT, INCOME-TAX WAS TO BE CHARGED UNDER THE HEAD CAPITAL GAIN ON TRANSFER OF A CAPITAL A SSET AND SHALL BE DEEMED TO BE THE INCOME OF THE PREVIOUS Y EAR IN WHICH TRANSFER TOOK PLACE. THE YEAR OF TRANSFER I S THE CRUCIAL YEAR AND NOT THE TIME OF THE RECEIPT. (V) THERE WAS NO FORCE IN THE CONTENTION THAT THE VALUE OF THE FLAT SHOULD NOT BE INCLUDED BECAUSE THE ASS ESSEE HAS NOT RECEIVED SUCH FLAT, BECAUSE THE FLAT WAS T O BE RECEIVED BY EACH MEMBER OF THE SOCIETY WAS PART OF THE ENTIRE CONSIDERATION AS PER CLAUSE 4.2 OF JDA. IN ANY CASE AS PER SECTION 45 R.W.S. 48, ITS FULL VALUE O F CONSIDERATION RECEIVED OR ACCRUED WHICH HAS TO BE CONSIDERED. (VI) IT WAS ALSO OBSERVED THAT SURRENDER OF ALLOT MENT LETTER BY THE MEMBERS INCLUDING ASSESSEE WAS PROCE SSED ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 56 IN ORDER TO ENABLE THE SOCIETY TO ENTER INTO TRIPA RTITE JDA WITH HASH AND THDC. BY SURRENDERING THE ALLOTMENT LETTER, THE RIGHT OF THE ASSESSEE IN IMMOVABLE PRO PERTY OWNED BY HIM GOT EXTINGUISHED AND THIS EXTINGUISHM ENT WAS IN LIEU OF ENTIRE CONSIDERATION WHICH WAS RECE IVED BY THE MEMBERS INCLUDING THE ASSESSEE. THUS THIS CAS E WAS ALSO COVERED U/S 2(47)(II) OF THE ACT. (VII) IT WAS OBSERVED THAT THERE IS NO MERIT IN TH E CONTENTION THAT THE ASSESSEE WOULD NOT BE COVERED U/S 54EC DUE TO LACK OF FUNDS OR EXEMPTION U/S 54 WAS NOT RELEVANT TO THE ISSUE ABOUT TAXABILITY OF LONG TER M CAPITAL GAINS WHICH WAS DEPENDENT ONLY ON TRANSFER. (VIII) IT WAS OBSERVED THAT THERE WAS NO FORCE IN THE CONTENTION THAT THE VALUE OF THE FLATS WAS UNDETER MINABLE BECAUSE THE VALUE OF THE FLAT WAS VERY MUCH DETERM INABLE AS PER THE MARKET RATE PREVAILING WHICH COULD ALSO BE ASCERTAINED FROM THE RATE AT WHICH THE FLATS WERE BEING OFFERED TO THE GENERAL PUBLIC. (X) THE ASSESSING OFFICER WAS OF THE VIEW THAT THE CASE LAWS RELIED ON BY THE ASSESSEE WERE DISTINGUISHABL E FOR WHICH THE REASONS HAVE BEEN GIVEN AT PAGE 23 AND 2 4 OF THE ASSESSMENT ORDER. 21 IN THIS BACKGROUND THE ASSESSEE WAS CHARGED TO CAPITAL GAIN TAX U/S 45 FOR THE TOTAL CONSIDERATIO N RECEIVED AND RECEIVABLE BY BEING A MEMBER OF THE SOCIETY IN VIEW OF JDA. 22 ON APPEAL BEFORE THE LD. CIT(A) DETAILED SUBMISSIONS WERE MADE (IN THE IMPUGNED ORDER REFER ENCE IS MADE TO WRITTEN SUBMISSIONS WITHOUT DISCUSSING THE ARGUMENTS). THE LD. CIT(A) REFERRED TO THE PROVIS IONS OF SECTION 45 AND 2(47) OF THE ACT AND OBSERVED THAT CLAUSES (V) TO (VI) WERE INSERTED IN SECTION 2(47) W.E.F. 1.4.1988. HE OBSERVED THAT BEFORE INSERTION OF THIS PROVISIO N, IT WAS ALWAYS POSSIBLE TO AVOID OR POSTPONE CAPITAL GAIN BY EITHER NOT EXECUTING CONVEYANCE DEED OR POSTPONE S UCH EXECUTION BECAUSE VENDOR OF THE PROPERTY COULD GIV E THE PRIVILEGE OF OWNERSHIP OR ENJOYMENT OF THE PROPERT Y BY EXECUTING A POWER OF ATTORNEY ETC. TO AVOID SUCH LEAKAGE OF REVENUE CLAUSES (V) AND (VI) WERE INSERTED TO S ECTION 2(47) OF THE ACT. HE THEN DISCUSSED THE DECISION OF ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 57 HON'BLE BOMBAY HIGH COURT IN CASE OF CHATURBHUJ DWARKADAS KAPADIA V. CIT, 260 ITR 491 (BOM) AND EXTRACTED THE FOLLOWING CONDITIONS WHICH WERE REQU IRED TO BE SATISFIED TO COVER THE CASE U/S 2(47)(V) R.W.S. 53A OF T.P. ACT. (A) THERE SHOULD BE CONTRACT FOR CONSIDERATION (B) IT SHOULD BE IN WRITING (C) IT SHOULD BE SIGNED BY THE TRANSFEROR OR ON HI S BEHALF (D) IT SHOULD PERTAIN TO TRANSFER OF IMMOVEABLE PR OPERTY (E) TRANSFEREE HAS IN PART PERFORMANCE OF CONTRACT HAS TAKEN POSSESSION OR PART POSSESSION OF THE PROPERTY . (F) LASTLY, TRANSFEREE SHOULD BE READY AND WILLING TO PERFORM HIS PART OF CONTRACT. 23 IF THE ABOVE CONDITIONS WERE SATISFIED THEN THE TRANSFER CAN BE SAID TO HAVE TAKEN PLACE FOR THE P URPOSE OF SECTION 45. ACCORDING TO HIM AS PER THE DECISI ON OF CHATURBHUJ DWARKADAS KAPADIA V. CIT (SUPRA) ONCE T HE POSSESSION OR PART POSSESSION OF THE PROPERTY WAS GIVEN BY THE TRANSFEROR TO THE TRANSFEREE THEN THE TRANSFER CAN BE SAID TO HAVE TAKEN PLACE. HE ALSO REFERRED TO THE DECISION OF AUTHORITY FOR ADV ANCE RULING IN CASE OF JASBIR SINGH SARKARIA, 164 TAXMAN 108: 294 ITR 196 . HE REFERRED TO VARIOUS OBSERVATIONS OF THE AUTHORITY IN THIS CASE AND CONCLUDED THAT THE RECEIPT OF ENTIRE CONSIDERATION WAS NOT A FACTOR T O BE SEEN FOR APPLICATION OF SECTION 2(47)(V). ONCE THESE TWO DECISIONS WER E CONSIDERED ALONG WITH THE PROVISIONS OF SECTION 45 R.W.S. 2(47)(V) THEN IT WOULD EMERGE AS UNDER: (A) THE JOINT DEVELOPMENT AGREEMENT HAS BEEN ENTER ED INTO BETWEEN THE PUNJAB COOP HOUSING BUILDING SOCIETY LTD. MOH ALI, OF WHICH ASSESSEE IS MEMBER, AND. M/S HASH BUILDERS (P) LTD. AND M/S TATA HOUSING DEVELOPMENT COMPANY LTD. MUMBAI AS ON 25.2. 2007. B) THE MEMBERS OF THE SOCIETY SURRENDERED THEIR ALLOTMENT RIGHTS AND THE SOCIETY ON BEHALF OF MEMBERS ENTERED INTO THE JOINT DEVELOPMENT AGREEMENT IN LIEU OF 'ENTIRE CONSIDERATION' AS DESC RIBED IN THE JOINT DEVELOPMENT AGREEMENT IN THE PREVIOUS YEAR 2006-07 . (C) THE RECEIPT OF CONSIDERATION WAS STRUCTURED AND THE ASSESSEE RECEIVED PART OF THE ENTIRE CONSIDERATION' DURING THE FINANCIAL YEAR 2006- 07. THIS CLEARLY SHOWS THAT THE TRANSFEREE IS READY AND WILLING TO PERFORM HIS PART OF CONTRACT. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 58 (D) IN VIEW OF CLAUSE 2.1 OF THE JOINT DEVELOPMENT AGREEMENT, THE OWNER HAS AT THE TIME OF MAKING THE AGREEMENT IRREV OCABLY AND UNEQUIVOCALLY GRANTED AND-ASSIGNED IN PERPETUITY AL L ITS RIGHTS TO DEVELOP, CONSTRUCT, MORTGAGE, LEASE, LICENSE, SELL AND TRANS FER THE PROPERTY I.E (21.2 ACRES OF LAND) ALONGWLTH ANY AND ALL CONSTRUCTIONS, TREES ETC. IN FAVOUR OF M/S TATA HOUSING DEVELOPMENT COMPANY LTD, FOR THE P URPOSE OF DEVELOPMENT, CONSTRUCTION, MORTGAGE, SALE , TRANSFE R, LEASE, LICENSE AND/OR EXPLOITATION FOR THE FULL UTILIZATION OF THE PROPER TY AND TO EXECUTE ALL THE DOCUMENTS NECESSARY TO CARRY OUT, FACILITATE AND EN FORCE THE RIGHTS IN THE PROPERTY. THUS, IN FACT THE OWNER HAS IRREVOCABLY AND UNEQUIVOCALLY GRANTED AND ASSIGNED IN PERPETUITY ALL THE RIGHTS W HICH AN OWNER CAN HAVE IN AN IMMOVEABLE PROPERTY. ALL THESE RIGHTS HAVE BE EN GIVEN ON DATE OF AGREEMENT I.E. 25.02.2007 AND EVEN POSSESSION HAS B EEN HANDED OVER IN THE FINANCIAL YEAR 2006-2007. THE PARA 2.1 CLEARLY STATES THAT ' THE OWNER HEREBY HANDS OVER THE ORIGINAL TITLE DEEDS OF THE P ROPERTY AS MENTIONED IN THE LIST ANNEXED HERETO AND MARKED AS ANNEXURE IV A ND PHYSICAL, VACANT POSSESSION OF THE PROPERTY HAS BEEN HANDED OVER TO THDC SIMULTANEOUSLY TO THE EXECUTION AND REGISTRATION OF THIS AGREEMENT TO DEVELOP THE SAME AS SET OUT THEREIN. THUS POSSESSI ON IN PART PERFORMANCE OF CONTRACT HAS BEEN HANDED OVER TO THE TRANSFEREE WITHOUT ANY AMBIGUITY IN THE PREVIOUS YEAR 2006-07 ITSELF. E) AN IRREVOCABLE TRANSFER HAS THUS BEEN MADE WHICH IS NOT DEPENDENT ON ANY CONDITION TO BE FULFILLED. F) FURTHER COINING TO 'CONSIDERATION' PART . AS P ER PARA 4,1 RS,6,00,000 PER HOLDER OF 1000 SQ,YARDS HAS TO BE PAID BY TRANS FEREE ON ACCOUNT OF EARNEST MONEY , WHICH HAS BEEN PAID TO THE ASSESSEE , FURTHER AS PER PARA 4.1 (II) CLEARLY STATES THAT IN LIEU OF. RS, 1 2,00,000 PER PLOT HOLDER OF 500 SQ. YARDS AND RS.24,00,000 PER PLOT HOLDER OF 1 000 SQ. YARDS IS BEING PAID ON THE EXECUTION OF AGREEMENT AGAINST' W HICH THE SOCIETY ON BEHALF OF MEMBERS WILL TRANSFER 3.08 ACRES OF THE C ONTIGUOUS LAND OUT OF PROPERTY, IT HAS BEEN CONFIRMED THAT AGAINST THE AB OVE PAYMENT THE LAND MEASURING,3.08 ACRES HAS BEEN TRANSFERRED IN THE N AME OF THDC AND REGISTERED VIDE SALE DEED DATED 02/03/2007 I.E. IN THE PREVIOUS YEAR 2006- 07. G) THUS IT IS CLEAR FROM ABOVE TRANSACTIONS THAT TRANSFEREE, M/S TATA HOUSING DEVELOPMENT COMPANY LTD,, MUMABI, HAS PERFO RMED AND IS WILLING TO PERFORM HIS PART OF CONTRACT AND IN THIS PART PERFORMANCE OF CONTRACT, THE ASSESSEE AND OTHER MEMBERS OF THE PUN JAB COOP HOUSING BUILDING SOCIETY LTD, MOHALI HAVE GIVEN POSSESSION OF THE WHOLE OF LAND OF 21.2 ACRES TO THE THDC AND HAVE FURTHER IRREVOCABLY AND UNEQUIVOCALLY GRANTED AND ASSIGNED ALL RIGHTS IN PERPETUITY TO TH DC IN THE SAID PREVIOUS YEAR I.E. 2006-07. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 59 H) HENCE IT IS ESTABLISHED BEYOND DOUBT THAT TRANS FER HAS TAKEN PLACE AS ENVISAGED AS PER SECTION 2(47)(V) OF THE-INCOME TAX ACT AND SINCE IT HAS TAKEN PLACE THROUGH SOCIETY OF WHICH ASSESSEE IS AL SO MEMBER SO SECTIONS 2(47) (VI) AND 2(47)(II) WOULD ALSO SUPPOR T SECTION 2(47)(V) OF THE INCOME TAX ACT. (I) NOW ONCE IT HAS BEEN ESTABLISHED THAT TRANSFER HAS TAKEN PLACE, THEN THE NEXT IMPORTANT QUESTION IS THE YEAR IN WHI CH THE TRANSFER HAS TAKEN PLACE AND IT IS THE YEAR IN WHICH THE TRANSFE R HAS TAKEN PLACE, WHOLE OF THE CONSIDERATION , WHETHER RECEIVED OR RECEIVAB LE IN CASH OR KIND, WOULD BE CHARGEABLE TO CAPITAL GAINS U/S 45, WHETHE R THE ENTIRE CONSIDERATION HAS BEEN RECEIVED IN THE YEAR OF TRAN SFER OR NOT. J) FROM THE DISCUSSION IN ABOVE PARAS IT IS CLEAR T HAT NOT ONLY AGREEMENT HAS BEEN ENTERED INTO IN, THE PERVIOUS YEAR 2006-07 BUT THE OWNER HAS AT THE TIME OF MAKING THE AGREEMENT IRREVOCABLY AND UN EQUIVOCALLY GRANTED AND ASSIGNED IN PERPETUITY ALL ITS RIGHTS TO DEVEL OP, CONSTRUCT, MORTGAGE, LEASE, LICENSE, SELL AND TRANSFER THE PROPERTY I.E (21.2 ACRES OF LAND) ALONGWITH ANY AND ALL CONSTRUCTIONS, TREES ETC. IN FAVOUR OF M/S TATA HOUSING DEVELOPMENT COMPANY LTD. K) FURTHUR M/S TATA HOUSING DEVELOPMENT COMPANY LTD HAS ALSO IN PART PERFORMANCE OF CONTRACT HAS MADE THE PAYMENTS TO THE OWNERS AND IS WILLING TO PERFORM HIS PART, OF CONTRACT AND THE ME MBERS OF SOCIETY IN THIS PART PERFORMANCE OF CONTRACT HAVE ASSIGNED FULL RIG HTS IN THE FAVOUR OF TRANSFEREE IN THE PREVIOUS YEAR 2006-07 ITSELF AND SURRENDERED ALLOTMENT LETTERS TO ENABLE THE SOCIETY TO ENTER INTO TRIPAR TITE AGREEMENT WITH HASH AND THDC. L) MOST IMPORTANTLY PHYSICAL AND VACANT POSSESSION OF WHOLE OF THE LAND OF 21.2 ACRES HAS BEEN HANDED TO M/S TATA HOUSING DEVE LOPMENT COMPANY LTD. IN THE PREVIOUS YEAR 2006-07, SAME IS CLEAR FR OM PARA 2.1 OF THE JOINT DEVELOPMENT AGREEMENT AND DISCUSSED IN DETAIL IN PR ECEEDING PARAGRAPHS. M) THUS THE TRANSFER WOULD BE DEEMED TO HAPPEN IN THE PREVIOUS YEAR 2006-07 ITSELF. N) IT HAS ALREADY BEEN DISCUSSED IN DETAIL THAT REG ISTRATION OF CONVEYANCE DEED AND RECEIPT OF ENTIRE CONSIDERATION IS NOT AT ALL IMPORTANT IN THE YEAR IN WHICH DEEMED TRANSFER U/S 2(47)(V) O F IT ACT HAS TAKEN PLACE. O) FURTHER THE AGREEMENT IS CLEAR AND THERE IS NO AMBIGUITY REGARDING IRREVOCABLE RIGHTS BEING GIVEN TO THE TRANSFEREE. A S REGARDS CERTAIN PETTY ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 60 CONDITIONS AND PROVISIONS RELATING TO TERMINATION O F THE CONTRACT, IT IS OBSERVED THAT THESE CLAUSES ARE NECESSARY PART OF S UCH TYPE OF JOINT DEVELOPMENT AGREEMENT. AT THE SAME TIME SUCH AGREEM ENTS INCLUDING THIS AGREEMENT HAS THE PROVISIONS OF 'DISCLAIMER' 'PARTI AL INVALIDITY' 'INDEMNITY' AND 'ARBITRATION'. THE DISPUTES ARISING, IF ANY, SH ALL BE RESOLVED AS PER THE PROVISIONS AND AWARDS SHALL BE GRANTED, IN APPROPRI ATE CASES BY THE ARBITRATOR. THESE PROVISIONS ARE THERE TO SAFEGUARD THE INTEREST OF ALL THE PARTIES TO THE JOINT DEVELOPMENT AGREEMENT AND PART IES WOULD BE INDEMNIFIED BY EACH OTHER AND SHALL ALSO RECEIVE AW ARD IF THE TERMS/CONDITIONS ARE NOT FULFILLED. P) AS REGARDS APPLICABILITY OF SECTION 54F, THERE A RE-CERTAIN CONDITIONS WHICH ARE ATTACHED WITH SECTION 54F ALSO WHICH HAVE TO BE FULFILLED BEFORE WHICH EXEMPTION UNDER THAT SECTION IS AVAILABLE TO THE ASSESSEE. THE ASSESSEE HAS NOT EVEN TRIED TO MAKE ANY CLAIM BY SH OWING THAT HE HAS FULFILLED THE SAID CONDITIONS TO BE ELIGIBLE FOR EX EMPTION UNDER SECTION 54F, SO EXEMPTION CANNOT BE GIVEN IN SUCH A SITUATION U/ S 54F. Q) THE JUDGMENT RELIED UPON BY THE ASSESSEE ARE NOT APPLICABLE TO THE CASE OF ASSESSEE AS MOST OF THEM PERTAIN TO THE PRE VIOUS YEAR BEFORE SECTION 2(47)(V) AND 2(47)(VI) WAS INSERTED W.E.F. 1.4.1988. OTHER JUDGMENTS REFERRED BY ASSESSEE ARE DISTINGUISHABLE AS FOLLOWS: ACIT VS PUSPA DEVI: THIS RULING HAS BEEN IN FACT IN FAVOUR OF REVENUE AND COMPLETELY RATIFIES THE PRINCIPLES LAID DOWN IN THE JUDGMENT OF CHATURBHUH DWARKADAS KAPADIA VS CIT AS IT SAYS THAT TRANSFER O F CAPITAL ASSET TOOK PLACE BY VIRTUE OF AGREEMENT DATED 07/09/1991 IN TH E FINANCIAL YEAR 1991- 92 AND AS SUCH, THE AO WAS FULLY JUSTIFIED IN LEVYI NG CAPITAL GAINS IN THE SAME PREVIOUS YEAR. II) CIT VS K. JEEIANI BASHA: THIS RULING SUPPORTS T HE CONTENTION OF REVENUE THAT ENTIRE CONSIDERATION RECEIVABLE FOR THAT PART OF PROPERTY WOULD 'BE' TAXABLE WHICH HAS BEEN PARTED WITH OR TRANSFERRED E VEN WHEN WHOLE OF THE CONSIDERATION LIES NOT BEEN RECEIVED. . III) ZUARI ESTATE DEVELOPMENT & INVESTMENT CO. (P) LTD, VS DCIT: THIS CASE IS ALSO NOT RELEVANT AS IT PERTAINS TO AGREEME NT ENTERED INTO IN 1984 MUCH BEFORE SECTION 2(47(V) WAS INSERTED . 24. BEFORE US, THE LD. COUNSEL OF THE ASSESSEE MAD E DETAILED SUBMISSIONS. FURTHER WRITTEN SUBMISSIONS HAS ALSO BEEN FILED. HE CARRIED US THROUGH THE FACTS OF THE CASE BY REFERRING TO VARIOUS DOCUMENTS IN PAPER BO OK AND ALSO CASE LAWS AS WELL AS COMMENTARY BY, MULLA DINSHAW FREDERICK MULLA ON THE INTERPRETATION OF SECTION ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 61 53A OF TRANSFER OF PROPERTY ACT. THE SUBMISSIONS C AN BE SUMMARIZED AS UNDER: I FIRST OF ALL HE REFERRED TO PROVISIONS OF SECTIO N 2(47)(V) OF IT ACT AND SECTION 53A OF T.P. ACT AND SUBMITTED THAT FOLLOWING CONDITIONS EMERGED FOR AT TRACTING THESE PROVISIONS- A THERE MUST BE CONTRACT OF TRANSFER FOR CONSIDERA TION FOR AN IMMOVABLE PROPERTY; B CONTRACT MUST BE IN WRITING C TERMS NECESSARY TO CONSTITUTE TRANSFER SHOULD BE ASCERTAINABLE WITH REASONABLE CERTAINTY. D THE TRANSFEREE MUST HAVE IN PART PERFORMANCE TAK EN THE POSSESSION OF THE PROPERTY OR PART THEREOF FRO M THE TRANSFEROR AND IF ALREADY IN POSSESSION, CONTINUES IN THE POSSESSION IN PART PERFORMANCE OF THE CONTRACT. E TRANSFEREE MUST HAVE DONE SOMETHING IN FURTHERAN CE OF THE CONTRACT. F THE TRANSFEREE MUST HAVE PERFORMED OR WILLING TO PERFORM HIS OBLIGATIONS IN SUCH CONTRACT. IN VIEW OF THE ABOVE CONDITIONS IN THE PRESENT CAS E, CONDITION NO. (D) AND (F) HAVE NOT BEEN COMPLIED B ECAUSE THE ASSESSEE AND/OR SOCIETY HAS NOT HANDED OVER TH E POSSESSION TO THDC/HASH. IN THIS REGARD HE PARTICU LARLY REFERRED TO CLAUSE 2(1) OF THE JDA AND POINTED OUT THAT THE POSSESSION WAS TO BE HANDED OVER TO THDC/HASH SIMULTANEOUSLY WITH THE EXECUTION AND REGISTRATION OF THE JDA. SINCE THE JDA WAS NOT REGISTERED THEREFORE, IT IS CLEAR THAT THE POSSESSION WAS NOT HANDED OVER. IN ANY CASE THE POSSESSION IF AT ALL WAS GRANTED AS PERMI SSIVE LICENSE WITH RIGHT TO DEVELOPERS I.E. THDC/HASH ON LY FOR THE PURPOSE OF DEVELOPMENT OF THE LAND AND NOT AS PART OF PERFORMANCE OF THE CONTRACT OF TRANSFER OF LAND. THE FACT THAT POSSESSION WAS NOT HANDED OVER TO THE THDC/HA SH ALSO BECOMES CLEAR FROM THE SALE DEED DATED 2.3.20 07 (PLACED AT PAGE 119 TO 136). HE REFERRED TO CLAUS E A OF RECITATION CLAUSES AT PAGE 120 WHICH CLEARLY PROVI DES THAT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 62 VENDOR I.E. THE SOCIETY WAS OWNER AND IN POSSESSIO N OF TOTAL LAND MEASURING 160 KANAL AND 7 MARLAS EQUIVA LENT TO 21.2 ACRES IN VILLAGE KANSAL DISTT. MOHALI. THIS DEED WAS FOR SALE OF PART OF THE PROPERTY MEASURING ABOUT 3 .08 ACRES OUT OF TOTAL LAND CONTRACTED TO BE GIVEN TO THDC/HASH MEASURING ABOUT 21.2 ACRES. HE POINTED OUT THAT SALE DEED HAS BEEN EXECUTED ON 2.3.2007 WHERE AS JDA WAS EXECUTED ON 25.2.2007. THUS IT IS CLEAR T HAT NO POSSESSION WAS GIVEN ON 25.2.2007 OTHERWISE THE SO CIETY WOULD NOT BE IN POSSESSION ON 2.3.2007. SIMILARLY ONE MORE PART OF THE LAND WAS SOLD BY SECOND DEED EXEC UTED ON 25.4.2007 WHEREIN SIMILAR CLAUSE A AS IN THE FIRST DEED IS THERE (REFER PAGE 138 OF THE PAPER BOOK) S HOWS THAT THE SOCIETY WAS IN POSSESSION OF THE LAND ON LATER DATE. THESE TWO SALE DEEDS CLEARLY SHOW THAT NO POSSESSION WAS GIVEN ON THE DATE OF EXECUTION OF T HE JDA. IN ANY CASE THE JDA MAKES IT CLEAR THAT THE POSSESSION WAS TO BE GIVEN SIMULTANEOUSLY TO THE REGISTRATION OF JDA AND SINCE JDA WAS NOT REGISTER ED, NO POSSESSION WAS GIVEN. II IT WAS SUBMITTED THAT THE POSSESSION, IF AT AL L, WAS GIVEN TO THE DEVELOPERS I.E THDC/HASH WHICH WAS A PERMISSIVE LICENSE TO DEVELOP THE PROJECT AND NOT AS PERFORMANCE OF THE CONTRACT. REFERENCE WAS MADE T O SECTION 52 OF THE INDIAN EASEMENT ACT, 1882 WHICH READS AS UNDER: 52. LICENCE DEFINED WHERE ONE PERSON GRANTS TO ANOTHER, OR TO A DEFINI TE NUMBER OF OTHER PERSONS, A RIGHT TO DO, OR CONTINUE TO DO, IN OR UPON THE IMMOVABLE PROPERTY ALL THE GRANTOR, SOMETHING WHICH WOULD, IN THE ABSENCE OF SUCH RIGHT , BE UNLAWFUL AND SUCH RIGHT DOES NOT AMOUNT TO AN EASEM ENT OR AN INTEREST IN WHICH THE PROPERTY, THE RIGHT IS CALLED A LICENSE. IT WAS CONTENDED THAT SECTION 2(47)(V) R.W.S. 53A OF T.P ACT REFERS TO LEGAL POSSESSION WHEREBY THE TRANSFE REE HAS A LEGAL RIGHT TO ENTER UPON AND EXERCISE RIGHTS OF POSSESSION I.E. CONTROL OVER THE PROPERTY. IN THI S CONNECTION HE REFERRED TO THE OBSERVATION OF AUTHO RITY FOR ADVANCE RULING IN CASE OF JASVIR SINGH SARKARIA, 2 94 ITR 196. HE PARTICULARLY REFERRED TO PARA 26 TO 28 OF THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 63 JUDGMENT. HE FURTHER REFERRED TO CLAUSE F (PAGE 17 OF THE PAPER BOOK) I.E., CLAUSE 2.1 OF THE JDA (PAGE 24 OF THE PAPER BOOK) AND SUBMITTED THAT CONTENTS OF THE SE CLAUSES WILL ENTIRELY SHOW THAT POSSESSION WAS GIV EN AND WAS ENVISAGED IN THE SHAPE OF LICENSE TO THE DEVEL OPERS FOR UNDERTAKING THE DEVELOPMENT OF PROPERTY AND LE GAL POSSESSION WAS NEITHER HANDED OVER OR INTENDED TO BE HANDED OVER. III MONEY WHICH IS RECEIVED AT THE TIME OF EXECUTI ON OF JDA CAN BE TERMED AS ADVANCE PAYMENT. IN ANY CASE WHEN THESE AMOUNTS WERE ADJUSTED AS PART OF SALE CONSIDERATION FOR SALE OF PART OF THE PROPERTY AND THE SAME HAVE BEEN RETUNED BY THE ASSESSEE AS LONG TE RM CAPITAL GAINS THROUGH REVISED RETURN IN THE YEAR O F RECEIPT. IV IT WAS EMPHASIZED THAT IN ANY CASE SECTION 53A OF T.P. ACT HAS BEEN AMENDED BY AMENDMENT ACT, 2001 WHEREBY REGISTRATION OF AGREEMENT HAS BEEN MADE MANDATORY FOR THE SAME TO BE ENFORCEABLE. SINCE J DA WAS NEVER REGISTERED THEREFORE, RECOURSE COULD NO T BE TAKEN TO SECTION 2(47)(V) OF THE ACT BECAUSE JDA W AS NOT REGISTERED. PURSUANT TO AMENDMENT IN SECTION 53A OF T.P. ACT WITH EFFECT FROM 24.9.2001 IT WAS ONLY T HE AMENDED PROVISION WHICH CAN BE READ WITH SECTION 2(47)(V) OF THE ACT. IN THIS REGARD HE REFERRED T O DECISION OF HON'BLE SUPREME COURT IN CASE OF SURANA STEELS P LTD. V. CIT, 237 ITR 777. IN THAT CASE IT WAS OBSERVED THAT WHEN A SECTION OR AN ACT OF PARLIAMENT IS INTRODUC ED INTO ANOTHER ACT, IT MUST BE READ IN THE SENSE IT BORE IN THE ORIGINAL ACT. IN OTHER WORDS, THE MEANING ATTACHE D TO THE ORIGINAL SECTION WHICH HAS BEEN REFERRED IN ANOTHE R ACT, HAS TO BE UNDERSTOOD AS SAME. THEREFORE, ONCE TH E ORIGINAL SECTION 53A OF T.P. ACT UNDERGOES AMENDME NT THE SAME HAS TO BE READ IN SECTION 2(47)(V) AS AMENDED AND THEREFORE, AS JDA IS NOT REGISTERED SECTION 2(47) (V) WILL NOT BE APPLICABLE. V THE LD. COUNSEL OF THE ASSESSEE REFERRED TO THE DECISION OF HON'BLE BOMAY HIGH COURT IN CASE OF CHATURBHUJ DWARKADAS KAPADIA V CIT (SUPRA) AND TRI ED TO DISTINGUISH THE SAME. HE SUBMITTED THAT THIS DECI SION CANNOT BE TAKEN AS AN AUTHORITY FOR THE PROPOSITIO N THAT DATE OF AGREEMENT SHOULD BE RECKONED AS DATE OF TR ANSFER. IN ANY CASE, THE DECISION HAS TO BE SEEN FOR WHAT HAS BEEN HELD IN THE DECISION AND IN THIS CASE ULTIMAT ELY THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 64 APPEAL OF THE ASSESSEE WAS ALLOWED WHICH MEANS THE TRANSFER WAS HELD TO HAVE TAKEN EFFECT ONLY AFTER RECEIPT OF SUBSTANTIAL PAYMENT OF CONSIDERATION. VI THE LD. COUNSEL OF THE ASSESSEE FURTHER POINTED OUT THAT THERE IS ANOTHER IMPORTANT CONDITION IN INVOK ING SECTION 2(47)(V) OF THE ACT R.W.S 53A OF T.P. ACT I.E. THE TRANSFEREE MUST HAVE PERFORMED OR WILLING TO PERFO RM HIS PART OF THE CONTRACT. IT WAS ARGUED THAT WILLINGN ESS OF THE TRANSFEREE TO PERFORM HIS PART OF THE CONTRACT IS NOT AN EMPTY FORMALITY AND IT HAS TO BE ABSOLUTE AND UNQU ALIFIED. THUS WILLINGNESS CANNOT BE CONDITIONAL OR CONTINGE NT ON SUBSEQUENT EVENTS. IN THE JDA FOLLOWING OBLIGATION S WERE TO BE COMPLIED BY THE TRANSFEREE (A) AS PER CLAUSE J OF THE JDA THE GOVERNMENT APPROVALS WERE TO BE OBTAINED BY THE TRANSFEREE I. E. THDC/HASH. (B) AS PER CLAUSE 3.1 OF JDA ALL BUILDING, PLANS A ND DESIGNS AND DRAWINGS ETC. FOR CONSTRUCTION OF THE PROJECT WERE TO BE PREPARED BY THE TRANSFEREE I.E. THDC/HA SH. (C) CLAUSE 4.1 AND 7.10 OF JDA PROVIDED REGARDING TIMELY PAYMENT OF CONSIDERATION. (D) CLAUSE 7.9 OF THE JDA PROVIDED THAT THDC/HASH SHALL OBTAIN ALL APPROVALS AND COMMENCE CONSTRUCTI ON WITHIN 6 MONTHS OF HAND OVER OF FINAL PLANS. (E) CLAUSE 8.4 PROVIDED OBLIGATION TO TAKE TIMELY APPROVAL AND CLAUSE 8.6 PROVIDED FOR PAYMENT OF VA RIOUS STATUTORY CHARGES IN RESPECT OF DEVELOPMENT CHARGE S, LICENSE FEE AND EXTERNAL DEFAULT ETC. FURTHER TO ABOVE OBLIGATION, TIME WAS OF ESSENCE IN THE CONTRACT WHICH BECOMES CLEAR FROM CLAUSE 1.2( A), 4.1 AND 7.10 REGARDING TIMELY PAYMENT AND CLAUSE 14(IV ) REGARDING TERMINATION OF CONTRACT. IN THE CASE BEFORE US, THERE WAS NO WILLINGNESS ON THE PART OF DEVELOPER I.E. THDC/HASH TO PERFORM THE AB OVE OBLIGATION BECAUSE OF THE FOLLOWING ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 65 (I) THDC/HASH FAILED TO OBTAIN NECESSARY APPROVAL AND DID NOT UNDERTAKE ANY DEVELOPMENT WORK ON LAND. (II) THDC/HASH I.E. DEVELOPER HAS NOT PAID TIMELY PAYMENT IN TIMELY INSTALLMENTS OF AGREED CONSIDERA TION. (III) HASH HAS NOT OBTAINED APPROVAL FROM VARIOUS AUTHORITIES AND HAD NOT COMMENCED CONSTRUCTION WIT HIN SIX MONTHS OF HANDING OVER ALL FINAL PLANS. (REFE RENCE WAS MADE TO PAGE 34 OF THE PAPER BOOK). (IV) THDC/HASH VIDE LETTER DATED 4.2.2001 (PAGE 23 TO 24 OF THE ADDITIONAL EVIDENCE) REFUSED TO MAKE FUR THER PAYMENT AS STIPULATED IN THE AGREEMENT. (V) THE TRANSFEROR HAS GONE BACK ON THEIR REPRESEN TATION TO COMPLETE CONSTRUCTION IN THE TIME BOUND MANNER AND IN HANDING OVER THE FLATS TO THE SOCIETY /ITS MEMBERS . IN THIS REGARD HE ALSO REFERRED TO PARA 16 OF THE COMMENTARY BY MULLA DINSHAW FREDERICK MULLA (C OPY OF WHICH HAS BEEN FILED AT PAGE 102 AND 103 OF THE PAPER BOOK). HE POINTED OUT HOW THE LD. AUTHORS HAVE DI SCUSSED THE SIGNIFICANCE OF THE WILLINGNESS OF THE TRANSFE REE TO PERFORM THEIR PART OF THE CONTRACT. IN THIS REGAR D HE ALSO REFERRED TO VARIOUS OBSERVATIONS IN THE FOLLOWING CASE LAWS: GENERAL GLASS CO. PVT LTD. V DCIT, 14 SOT 132 (MUM ) K RADHIKA V DCIT, 149 TTJ 736 (HYD) DCIT V. TEJ SINGH, 138 ITD 489 (AGRA) THE FACTS OF THESE CASE LAWS AND THE FACTS IN THE PRESENT CASE BEFORE US ARE IDENTICAL AND THEREFORE, SINCE AS PER THESE DECISIONS THERE WAS NO WILLINGNESS ON THE PA RT OF THE TRANSFEREE TO PERFORM HIS/ITS OBLIGATION THE P ROVISIONS OF SECTION 2(47) (V) R.W.S. 53A OF T.P. ACT COULD NOT BE APPLIED. VII IT WAS CONTENDED THAT REVENUE HAS ALSO HELD TH AT CLAUSE (VI) OF SECTION 2(47) IS ALSO APPLICABLE WH ICH IS NOT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 66 CORRECT BECAUSE THAT PROVISION IS APPLICABLE WHERE A PERSON BECOMES OWNER OF THE IMMOVABLE PROPERTY PURSUANT TO TAKING MEMBERSHIP OF COOPERATIVE SOCIE TY ETC. IN THE PRESENT CASE, THE JDA WAS ENTERED INT O BETWEEN SOCIETY AND TWO DEVELOPERS I.E. THDC/HASH AND THEREFORE, THERE WAS NO TRANSACTION INVOLVING MEMB ERSHIP OF COOPERATIVE SOCIETY/ COMPANY ETC. THEREFORE, CLEARLY CLAUSE (VI) OF SEC 2(47) IS NOT APPLICABLE IN THE PRESENT CASE. VIII THE LD. COUNSEL OF THE ASSESSEE ALSO SUBMITTE D THAT AS PER CLAUSE 4.1 OF THE JDA TRANSFER/SALE OF 21.2 ACRES OF LAND WAS TO BE MADE IN FAVOUR OF THDC/HASH ON A P RO- RATA BASIS CORRESPONDING TO PRO-RATA PAYMENTS RECE IVED BY THE SOCIETY AND RESPECTIVE MEMBERS OF THE SOCIETY FROM THDC/HASH BY EXECUTING THE SALE DEED. THIS CLEARLY SHOWS THAT TRANSFER WAS WHOLLY DEPENDENT ON TIMELY RECEIPT OF THE CONSIDERATION. AS POINTED OUT EARL IER ONLY TWO SALE DEEDS COULD BE EXECUTED AND WHATEVER PAYM ENTS HAVE BEEN RECEIVED, HAVE BEEN OFFERED FOR TAXATION UNDER THE HEAD CAPITAL GAIN. HOWEVER, THE ASSESSING O FFICER HAS SUBJECTED TO TAX WHOLE OF THE CONSIDERATION UN DER THE JDA AS CAPITAL GAIN WHICH IS TOTALLY UNCALLED FOR PARTICULARLY IN VIEW OF THE FACT THAT AN AGREEMENT HAS BEEN SUBSEQUENTLY TERMINATED AND THIS ACTION OF TH E ASSESSING OFFICER AMOUNTS TO TAXATION OF NOTIONAL SUM WHICH IS NOT PERMISSIBLE UNDER THE LAW. UNDER THE VARIOUS PROVISIONS OF THE ACT, ONLY REAL INCOME CAN BE TAX ED WHICH HAS BEEN EARNED BY THE ASSESSEE AND NO NOTIONAL IN COME CAN BE SUBJECTED TO TAX. IN THIS REGARD, RELIANCE WAS PLACED ON THE FOLLOWING DECISIONS OF THE HON'BLE SUPREME COURT: SHOORJI VALLABHDAS & CO., 46 ITR 144 (S.C) CIT V. RAMAN AND CO. 67 ITR 11 (S.C) GODHRA ELECTRICITY CO. LTD. V CIT, 225 ITR 746 (S. C) CIT V. BALRAMPUR COMMERCIAL ENTERPRISES LTD., 262 ITR 439 (CAL) CIT V. K. JEELANI BASHA, 256 ITR 282 ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 67 FOBEOZ INDIA (P) LTD. V ITO, ITA NO. 9231/MUM/2010 (COPY FILED) IT WAS CLAIMED THAT SINCE THE FLATS WERE NEVER CON STRUCTED AND GIVEN TO THE ASSESSEE, THEREFORE, IF THE VALU E OF THE FLAT IS ADDED IN THE TOTAL CONSIDERATION THEN IT W ILL BE TOTALLY ON NOTIONAL BASIS AND SINCE NOTIONAL INCOM E CANNOT BE TAXED, THEREFORE, THE VALUE OF THESE FLATS, IN NO CASE, SHOULD BE CONSIDERED IN THE TOTAL CONSIDERATION. F URTHER IF NOTIONAL RECEIPTS WERE TAXED THEN THE ASSESSEE WOU LD BE DEPRIVED TO TAKE BENEFIT AVAILABLE IN THE IT ACT. FOR EXAMPLE IF WHOLE CONSIDERATION WAS RECEIVED THE AS SESSEE COULD HAVE EASILY TAKEN BENEFIT OF SECTION 54EC AN D OTHER PROVISIONS LIKE SECTION 54 BY INVESTING IN ANY SPE CIFIED ASSET OR A HOUSE. SINCE FULL CONSIDERATION HAS NO T BEEN RECEIVED AND THE ASSESSMENT OF THE WHOLE CONSIDERA TION WILL LEAD TO UNINTENDED CONSEQUENCES LIKE DENIAL O F DEDUCTION U/S 54 EC ETC. IX IT WAS CONTENDED THAT SINCE JDA HAS ALREADY BEE N TERMINATED VIDE SOCIETYS RESOLUTION DATED 13.6.20 11 AND THEREAFTER ON 31.10.2011 EVEN SPECIAL POWER OF ATT ORNEY EXECUTED EARLIER HAS BEEN REVOKED, THEREFORE, IN VIEW OF THE SUBSEQUENT EVENTS, THE BALANCE OF CONSIDERATIO N RECEIVABLE COULD NOT BE TAXED IN THE HANDS OF THE ASSESSEE. SUBSEQUENT EVENTS TO THE DATE OF TRANSA CTIONS HAVE TO BE RECKONED BEFORE TAXING A PARTICULAR TRANSACTION. HE ALSO SUBMITTED THAT IN ALMOST SIMI LAR CIRCUMSTANCES, SUBSEQUENT EVENTS WERE RECKONED BY MUMBAI BENCH OF THE TRIBUNAL IN CASE OF CHEMOSYN L TD. V ACIT, 139 ITD 68. HE REFERRED TO VARIOUS PARAS AN D POINTED OUT HOW THE SUBSEQUENT EVENTS WERE RECKONE D BY THE TRIBUNAL. X THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT WITHOUT PREJUDICE TO THE ABOVE IF IT IS CONSIDERED A CASE OF TRANSFER THEN THE VALUE OF FLAT TO BE ALLOTTED TO EACH OF THE MEMBER OF THE SOCIETY HAS NOT BEEN VALUED CORRECTL Y. THE ASSESSING OFFICER HAS REFERRED TO CLAUSE 3.5 OF IN TER-SE AGREEMENT ENTERED INTO BETWEEN THDC AND HASH. THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THE ASS ESSEE WAS NOT PARTY TO SUCH AGREEMENT AND PRICE AT WHICH THDC WAS SELLING FLATS TO HASH COULD NOT BE ADOPTED IN THE CASE OF THE ASSESSEE. IT WAS SUBMITTED THAT IF CL AUSE (5) WAS REFERRED TO IT CAN BE SEEN THAT REFERENCE HAS BEEN MADE TO TWO PRICES IE. RS. 2000/SQFT FOR 126 FLATS AND RS. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 68 4500 PER SQFT FOR THREE FLATS. THIS PRICE IS NOTI ONALLY FIXED BY TWO DEVELOPERS AND DID NOT REFLECT THE PRICE OF THE FLATS. IN ANY CASE THE DEVELOPERS HAVE NOT BEEN A BLE TO OBTAIN NECESSARY APPROVAL FROM THE CONCERNED AUTHO RITIES, THEREFORE, CONSTRUCTION OF SUCH FLATS HAS NOT COM MENCED AND NO FLATS HAVE BEEN CONSTRUCTED AND ALLOTTED TO THE ASSESSEE, THEREFORE, NOTIONAL VALUE OF THE SAME C OULD NOT BE ADOPTED AND TAXED IN THE HANDS OF THE ASSESSEE . AT BEST THE ASSESSING OFFICER COULD HAVE TAKEN THE PR ICE OF RS. 2000 PER SQFT. XI IT WAS CONTENDED THAT IF THE VALUE OF THE FLAT WAS TO BE RECOGNIZED FOR THE PURPOSE OF COMPUTING THE CAP ITAL GAIN, THE CORRESPONDING DEDUCTION U/S54F OF THE AC T SHOULD HAVE BEEN ALLOWED PARTICULARLY IN VIEW OF C IRCULAR NO. 472 DATED 15.10.1986. IN THIS REGARD HE RELIE D ON THE FOLLOWING DECISIONS: CIT V. SARDARMAL KOTHARI AND ANOTHER, 302 ITR 286 (MAD) CIT V. R.L. SOOD, 245 ITR 727 (DELHI) CIT V. MRS. HILLA J.B. WADIA, 216 ITR 376 (BOM) MRS. SEETHA SUBRAMANIAN V ACIT, 59 ITD 94 (MAD BEN CH) USHA VAID V ITO, 53 SOT 385 SMT. RANJIT SANDHU V DCIT, 133 TTJ 46 (CHD) 25 ON THE OTHER HAND, THE LD. CIT DR FOR THE REVENUE MADE DETAILED SUBMISSIONS AND HAVE ALSO FILED WRIT TEN SUBMISSIONS. IT WAS POINTED OUT BY THE CIT-DR FOR THE REVENUE THAT THOUGH COPY OF THE SPECIAL POWER OF A TTORNEY HAS BEEN FILED AT PAGES 153 TO 165 BUT TWO OF THE MOST IMPORTANT CRUCIAL PAGES CONTAINING CLAUSE U TO Z AND LAST PAGE NO. 9 ARE MISSING. HE MADE AN ALLEGATIO N THAT THIS HAS BEEN DONE DELIBERATELY WHICH WAS CONTROVE RTED BY THE LD. COUNSEL OF THE ASSESSEE AND HE SUBMITTE D THAT THIS IS A SIMPLE MISTAKE AND HE WOULD FILE THOSE P APERS. THE LD. DR FOR THE REVENUE IN VIEW OF THESE SUBMIS SIONS SUBMITTED THAT THESE PAGES CAN BE REFERRED IN CASE OF PUNJABI COOP HOUSE BUILDING SOCIETY LTD. IN ITA NO . 310& 556/CHD/2012 AT PAGE 40 TO 52 OF THE PAPER BOOK IN THAT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 69 CASE. THE SUBMISSIONS OF THE REVENUE CAN BE SUMMA RIZED AS UNDER: (I) THE SOCIETY PASSED A RESOLUTION IN ITS EXECUTI VE COMMITTEE ON 4.01.2007 WHICH WAS CONFIRMED / RATIF IED IN THE GENERAL BODY MEETING ON 25.2.2007. IN THE SOC IETY THERE WERE TWO TYPES OF MEMBERS HOLDING PLOTS OF 5 00 SQYD AND 1000 SQYD. IT WAS RESOLVED THAT MEMBERS WOULD SURRENDER THE RESPECTIVE PLOTS OF 500 SQYD AND 100 0 SQYD IN FAVOUR OF THE SOCIETY FOR FURTHER TRANSFER OF THE ENTIRE LAND BY THE SOCIETY IN FAVOUR OF THDC/HASH FOR TH E DEVELOPMENT OF PROPERTY IN LIEU OF CONSIDERATION O F RS. 82,50,000/- TO A MEMBER HOLDING 500 SQYD PLOT AND RS. 1,65,00,000/- TO A MEMBER HOLDING 1000 SQYD PLOT T O BE PAID IN FOUR INSTALLMENTS BY HASH DIRECTLY TO THE MEMBERS OF THE SOCIETY. IN ADDITION TO THIS CONSIDERATION MEMBER HOLDING 500 SQYD PLOT WAS TO RECEIVE A FURNISHED F LAT WITH SUPER AREA OF 2250 SQFT TO BE CONSTRUCTED BY THDC/ HASH AND TWO FLATS IN CASE OF MEMBERS HOLDING 1000 SQYD PLOTS. IT WAS ALSO RESOLVED THROUGH THIS RESOLUTION TO HA ND OVER THE POSSESSION OF THE PROPERTY AND ORIGINAL TITLE DEEDS OF THE PROPERTY TO THDC/HASH. THE SOCIETY WAS FURTHE R PERMITTED TO ALLOW THDC/HASH TO MORTGAGE, SELL THE PROPERTY AND CREATE CHANGE IN PROPERTY. THE SOCIE TY ALSO RESOLVED TO EXECUTE IRREVOCABLE POWER OF ATTORNEY IN FAVOUR OF THDC/HASH WHICH WAS ACTUALLY EXECUTED ON 26.2.2007 WHICH WAS DULY REGISTERED ALSO. PURSUAN CE TO THIS RESOLUTION, THE JDA WAS EXECUTED ON 25.2.2007 . THROUGH CLAUSE 2.1 IT WAS SPECIFICALLY AGREED THAT OWNER I.E. THE SOCIETY HAS IRREVOCABLY AND UNEQUIVOCALLY GRANTED AND ASSIGNED IN PERPETUITY ALL THE RIGHTS TO DEVEL OP / CONSTRUCT / MORTGAGE / LEASE / LICENSE, SELL AND T RANSFER THE PROPERTY. CLAUSE 6.7 OF THE JDA PROVIDES FOR EXECUTION OF IRREVOCABLE SPECIAL POWER OF ATTORNEY THROUGH WHICH RIGHTS OF DEVELOPMENT WERE GRANTED IN FAVOUR OF THDC/HASH AND RIGHT TO RAISE FINANCE BY MORTGAGE I N THE PROPERTY AND TO REGISTER THE CHARGE WITH COMPETENT AUTHORITY AND FURTHER POWER OF SALE ETC. WERE ALSO GIVEN THROUGH THIS POWER OF ATTORNEY. IT WAS AGREED THA T THE SOCIETY WOULD NOT REVOKE SUCH POWER OF ATTORNEY WI THOUT OBTAINING A SPECIFIC PRIOR WRITTEN CONSENT OF THDC /HASH. THE ABOVE CLAUSES CLEARLY SHOW THAT POSSESSION OF THE PROPERTY WAS HANDED OVER TO THDC/HASH AND FURTHER RIGHTS TO MORTGAGE AND SALE OF THE PROPERTY WAS AL SO GIVEN. THE COMBINED READING OF VARIOUS CLAUSES IN THE JDA AND POWER OF ATTORNEY SHOW THAT: ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 70 (I) ALL THE MEMBERS OF THE SOCIETY EXPRESSLY AND WILLINGLY HAD SURRENDERED THEIR RESPECTIVE PLOTS I N FAVOUR OF THE SOCIETY AND THE SOCIETY WAS AUTHORIZED TO SELL/TRANSFER THE ENTIRE LAND IN FAVOUR OF THDC/H ASH FOR A CONSIDERATION WHICH WAS SET OUT IN THE CLAUSES O F JDA. THE SOCIETY WAS ALSO AUTHORIZED TO HAND OVER ORIGI NAL TITLE DEEDS AND POSSESSION OF LAND TO THDC/ HASH. (II) THE SOCIETY HANDED OVER THE POSSESSION OF THE LAND AND ORIGINAL TITLE DEEDS OF THE PROPERTY TO THDC/ HASH. (III) SOCIETY PERMITTED THDC/HASH TO MORTGAGE, SEL L AND CREATE CHARGE IN THE PROPERTY. (IV) THE SOCIETY RESOLVED TO EXECUTE AN IRREVOCABL E SPECIAL POWER OF ATTORNEY WHICH COULD NOT BE REVOK ED IN ANY CIRCUMSTANCES WITHOUT PROPER CONSENT OF THDC/H ASH AND SUCH POWER OF ATTORNEY WAS ACTUALLY EXECUTED O N 26.2.2007. THROUGH THIS POWER OF ATTORNEY THDC/HAS H HAS BEEN AUTHORIZED TO MORTGAGE OR CREATE CHARGE B Y THE SOCIETY. THDC/HASH WAS AUTHORIZED TO GIVE THE POSSESSION OF THE PROPERTY OR ANY PART THEREOF TO THE AUTHORITIES TO WHOM SAME WAS REQUIRED TO BE HANDED OVER WHICH WAS NOT POSSIBLE UNLESS THDC/HASH WAS HANDED OVER THE POSSESSION OF THE PROPERTY AND THE RIGHTS OF THE OWNERSHIP. THROUGH THIS POWER OF ATTORNEY THE RIG HT TO SELL WAS ALSO GIVEN WHICH IS AGAIN NOT POSSIBLE WI THOUT TRANSFER OF POSSESSION OR OWNERSHIP. THESE CLAUSE S CLEARLY SHOW THAT COMPLETE CONTROL OVER THE PROPER TY CONFIRMING ALL PRIVILEGE OF OWNERSHIP WAS GIVEN IN FAVOUR OF THDC/HASH AND THUS SUCH TRANSFER OF OWNERSHIP SATISFIES THE REQUIREMENTS OF SECTION 45 R.W. CLAU SE (II), (V), (VI) OF SECTION 2(47) OF THE ACT. (II) THE LD. CIT DR FOR THE REVENUE CONTENDED THAT HON'BLE SUPREME COURT IN CASE OF SUNIL SIDHHARATH BHAI V CIT, 156 ITR 509 AND CIT V. NARANG PRODUCTS, 219 I TR 478 HAS CLEARLY HELD THAT DEFINITION OF TRANSFER U /S 2(47) IS INCLUSIVE ONE AND DOES NOT EXCLUDE CONTEXTUAL OR O RDINARY WORD MEANING OF TRANSFER. FURTHER IN CASE OF AJ AY KUMAR SHAH JAGATI V CIT, 168 TAXMAN 53 IT WAS OBSE RVED THAT FOR THE PURPOSE OF SECTION 45 OF THE ACT THE WORD TRANSFER AS DEFINED IN IT ACT IS REQUIRED TO BE CONSIDERED AND NOT SALE AS INDICATED IN THE TRANSF ER OF PROPERTY ACT. THEREFORE, U/S 2(47) OF THE ACT, IT IS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 71 TRANSFER WHICH IS ONE OF THE MOST IMPORTANT INGR EDIENT FOR LEVY OF TAXATION U/S 45 WHICH IS TO BE COMPLIE D WITH. FOR INVOKING SECTION 2(47) (V) WHAT IS REQUIRED IS THAT AN AGREEMENT TO SELL HAS BEEN ENTERED BY THE TRANSFER OR WITH THE TRANSFEREE AND POSSESSION HAS BEEN HANDED OVER BY THE TRANSFEROR TO THE TRANSFEREE IN PART PERFORMAN CE OF THE CONTRACT U/S 53A OF T.P. ACT. IN THIS REGARD HE R ELIED ON THE FOLLOWING DECISIONS:- 1) AUTHORITY FOR ADVANCE RULING (AAR) NEW DELHI IN THE CASE OF JASBIR SINGH SARKARIA 294 ITR 196 2) CHATURBHUJ DWARKADAS KAPADIA V CIT 260 ITR 491 (BOM.) 3) C.RAVI VS DCIT IN 325 ITR 417 (KER) 4) CIT V DR. T.K. DAYALU 202 TAXMAN 531 (KAR.) 5) D. KASTURI V CIT & ANR 323 ITR 40 (MAD.) 6) CIT V DHIR & CO. COLONISERS (P) LTA 288 ITR 561 (P&H) (III) THE LD. CIT DR FURTHER SUBMITTED THAT ASSESS EES CASE APART FROM BEING COVERED UNDER CLAUSE (V) OF SECTION 2(47) IS ALSO COVERED BY CLAUSE (VI) OF SECTION 2( 47) OF THE ACT. CLAUSE (VI) IS APPLICABLE IN CASES WHERE ANY TRANSACTION IS ENTERED INTO WHICH HAS THE EFFECT O F TRANSFERRING AND ENABLING THE ENJOYMENT OF IMMOVA BLE PROPERTY. IN THIS REGARD HE RELIED ON THE DECISI ONS OF MUMBAI BENCH D OF THE TRIBUNAL IN MS RUBAB M. KAZERANI V JCIT 91 ITR 429(MUM.), ITAT HYDERABAD A BENCH IN D. ACHUTHA RAO VS ACIT 106 ITD 388 (HYD) AND ITAT DELHI BENCH D BENCH IN ACIT V SMT. PUSHPA DEVI JAIN 93 ITD 289 (DELHI). (IV) HE FURTHER SUBMITTED THAT CLAUSE (V) & (VI) O F SECTION 2(47) OF THE ACT WERE INSERTED W.E.F. 1.4.1988 BY FINANCE ACT, 1987. BEFORE THAT, PASSING OF THE TITLE IN TH E PROPERTY WAS NECESSARY CONDITION TO CONSTITUTE A TRANSFER U NDER THE ACT IN VIEW OF THE VARIOUS PRONOUNCEMENTS OF THE C OURTS. IN THE MEANTIME IT WAS NOTICED BY THE GOVERNMENT T HAT MANY PROPERTIES WERE BEING TRANSFERRED WITHOUT EXE CUTION ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 72 OF SALE DEED THROUGH VARIOUS DOCUMENTS WHAT IS POP ULARLY KNOWN AS POWER OF ATTORNEY TRANSACTIONS. TO CURB THE LEAKAGE OF REVENUE, THROUGH SUCH TRANSACTION, CLAU SES (V) & (VI) WERE ADDED TO SECTION 2(47) WHICH DEFINES T RANSFER. THIS HAS BEEN EXPLAINED BY CIRCULAR NO. 495 DATED 22.9.1987. THE BOARD HAS CLARIFIED THROUGH PARAS 11.1 & 11.2 THAT NEWLY INSERTED CLAUSES (V) & (VI) WOULD ENLARGE THE DEFINITION OF TRANSFER WHEREBY THE CASES OF TR ANSFER WHAT IS POPULARLY KNOWN AS POWER OF ATTORNEY TRANSACTION WHICH ALLOWS THE ENJOYMENT OF RIGHT IN THE PROPERTY WOULD BE COVERED BY NEW DEFINITION. THE N EW CLAUSES WOULD ALSO COVER ARRANGEMENTS BY WHICH THE PROPERTY COULD BE ENJOYED BY BECOMING A MEMBER OF THE COMPANY OR SUCH OTHER ARRANGEMENT. ACCORDING TO H IM IT MAY NOT BE OUT OF PLACE TO INVOKE HEYDONS RULE OF INTERPRETATION OF STATUTES FOR INTERPRETING THESE CLAUSES. THE HEYDONS RULE IS MAINLY APPLICABLE WHEREVER TH E TRUE MEANING OF AMENDED PROVISIONS IS TO BE UNDERSTOOD. IF THE AMENDMENTS ARE SEEN THROUGH PRISM OF HEYDONS RULE, IT WOULD BECOME CLEAR THAT AMENDED CLAUSES H AVE BEEN BROUGHT ON THE STATUTE TO OVERCOME THE EARLIE R MISCHIEF. PROPERTIES COULD BE TRANSFERRED WITHOUT EXECUTION OF PROPER SALE DEEDS AND THE SAME COULD BE ENJOYED BY THE RESPECTIVE BUYERS WITHOUT ANY TAXAT ION ON THE PART OF SELLERS. (V) THE LD. DR POINTED OUT THAT THERE IS NO FORCE IN THE SUBMISSIONS THAT SINCE SECTION 53A OF THE TRANSFER OF PROPERTY ACT HAS ITSELF GONE UNDER AMENDMENT W.E.F . 24.9.2011 WHEREIN THE REGISTRATION OF THE AGREEMEN T HAS BEEN MADE MANDATORY AND, THEREFORE, SINCE JDA WAS NOT REGISTERED IT CANNOT BE CONSTRUED TO BE COVERED UN DER CLAUSE (V) OF SECTION 2(47). IT WAS CONTENDED THA T DOCTRINE OF PART PERFORMANCE WAS GIVEN STATUTORY RECOGNITION IN SECTION 53A OF THE TRANSFER OF PROP ERTY ACT AND IT WAS DESIRED ONLY TO PROTECT POSSESSION OF A TRANSFEREE WHEN THE TRANSFER FALLS SHORT OF REQUIR EMENT LAID DOWN BY LAW. THE PLEA OF THE PART PERFORMANCE COULD BE TAKEN ONLY AS SHIELD IN DEFENCE AND NOT AS A SW ORD. THE MOST IMPORT INGREDIENT OF SECTION 53A OF T.P. ACT WAS THE CHANGE OF POSSESSION. THE AMENDMENT TO SECTIO N 53A OF THE TRANSFER OF PROPERTY ACT HAS BEEN DONE PERH APS TO COLLECT REVENUE. IN ANY CASE, THE SAME CANNOT HA VE A IMPACT ON THE CLAUSE (V) OF SECTION 2(47). THIS I S SO BECAUSE CLAUSE (V) CLEARLY EMPLOYS LANGUAGE BY USI NG THE EXPRESSION PART PERFORMANCE OF A CONTRACT OF THE NATURE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 73 REFERRED TO IN SECTION 53A OF THE TRANSFER OF PROP ERTY ACT. THE LEGISLATURE INTENTIONALLY NOT EMPLOYED THE EXP RESSION IN PART PERFORMANCE OF CONTRACT AS DEFINED UNDER SECTION 53A OF TRANSFER OF PROPERTY ACT. THEREFORE, IT I S NATURE OF CONTACT WHICH IS SIMILAR TO THE NATURE OF CONTR ACT U/S 53A OF THE TRANSFER OF PROPERTY ACT WHICH IS RELEV ANT TO SECTION 2(47)(V). IN ANY CASE HON'BLE SUPREME COU RT IN THE CASE OF CIT VS PODAR CEMENT (P) LTD 226 ITR 62 5 HAS CLEARLY HELD THAT PRINCIPLE OF COMMON LAW, THE TR ANSFER OF PROPERTY ACT AND THE REGISTRATION ACT WERE NOT CON CLUSIVE FOR INTERPRETATION OF PROVISION OF INCOME TAX ACT ON THE QUESTION OF OWNERSHIP OF THE PROPERTY. IF CONSEQUE NT TO THE AMENDMENT IN SECTION 53A OF THE TRANSFER OF PR OPERTY ACT, THE REGISTRATION OF AGREEMENT WAS CONSIDERED AS ONE OF THE ESSENTIAL INGREDIENT THEN SECTION 2(47)(V) WOULD BECOME REDUNDANT. THE INCOME TAX ACT CANNOT BE INTERPRETED IN SUCH A WAY THAT A PARTICULAR PROVIS ION BECOMES REDUNDANT. IN ANY CASE IT HAS BEEN HELD BY MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF SURESH CHAND AGGARWAL VS ITO (48 SOT 2010) THAT AMENDMENT MADE IN SECTION 53A OF THE TRANSFER OF PROPERTY AC T BY WHICH REQUIREMENT OF REGISTRATION OF TRANSFER HAS BEEN BROUGHT ON STATUTE NEED NOT BE APPLICABLE FOR CONS TRUING THE MEANING OF THE TRANSFER WITH REFERENCE TO SE CTION 2(47) OF THE ACT. SIMILAR VIEW HAS BEEN TAKEN BY T HE ITAT COCHIN BENCH IN THE CASE OF G. SREENIVASAN VS DCIT 140 ITD 235 AND PUNE BENCH OF THE TRIBUNAL IN THE CASE OF MAHESH MEMICHANDRA GANESHWADE 51 SOT 155. (VI) IT WAS CONTENDED THAT THERE IS NO FORCE IN TH E SUBMISSIONS OF THE LD. COUNSEL FOR THE ASSESSEE TH AT THDC/HASH WERE NOT WILLING TO PERFORM THEIR PART O F THE CONTRACT. IT WAS POINTED OUT THAT DEVELOPERS I.E THDC/HASH HAVE MADE PAYMENTS AS PER CLAUSE 4(I)(II ) &(III) OF THE JDA. THE DEVELOPERS HAVE ALSO APPROA CHED THE CONCERNED AUTHORITIES FOR PERMISSIONS AND APPR OVALS AS PER THE OBLIGATION AGREED IN THE JDA. HOWEVER, A PIL WAS FILED AGAINST THE DEVELOPERS AGAINST TATA CAME LOT PROJECT (THIS IS THE NAME OF THE PROJECT WHICH WAS TO BE DEVELOPED BY THDC ON THE LAND ACQUIRED FROM THE SOCIETY). THE PIL WAS DISMISSED VIDE ORDER DATED 26.3.2012 (COPY OF ORDER FILED ON RECORD). A REFE RENCE TO PARAS 3, 4, 25 & 26 OF THIS ORDER WOULD CLEARLY SH OW THAT HON'BLE HIGH COURT HAS OBSERVED THAT AGAINST THE R ULES OF SANCTION UNDER THE ENVIRONMENT (PROTECTION) ACT, T HE RESPONDENT I.E. DEVELOPERS HAVE SOUGHT A REVIEW OF THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 74 ORDER BECAUSE OF THE FINDINGS ARRIVED AT WERE EX.P ARTE. NO ORDER IN THE REVIEW MATTER HAS BEEN PASSED BY THE COMPETENT AUTHORITY BECAUSE THE INTERIM ORDER PASS ED IN THE PIL WHICH WAS LATER ON CLARIFIED BY THE HON'BL E SUPREME COURT VIDE ORDER DATED 31.01.2012 PERMITTI NG THE CONCERNED AUTHORITIES UNDER THE DIFFERENT STATUTES GOVERNING THE MATTER TO EXERCISE THEIR RESPECTIVE JURISDICTION IN ACCORDANCE WITH THE LAW AND SUCH CLARIFICATIONS CAME IN LATER DECISION OF THE HIGH COURT. AS THE REJECTION UNDER THE WILDLIFE (PROTECTION) ACT HAS BEEN MADE BY THE AUTHORITY NOT COMPETENT TO DO SO, THE PROMOTERS HAVE SOUGHT REVIEW OF THE ORDER WHICH IS STILL PENDING FOR SOME OTHER REASONS. ALL THESE STEPS CL EARLY SHOWS THAT DEVELOPERS WERE WILLING TO PERFORM ALL THE OBLIGATIONS UNDERTAKEN UNDER JDA AND WERE PERUSING THE MATTER OF SANCTION OF THE PROJECT AT DIFFERENT LEV ELS VIGOROUSLY. THE COPY OF THE ORDER OF HON'BLE PUNJ AB & HARYANA HIGH COURT AND HON'BLE SUPREME COURT FILED AT PAGES 172 TO 174 OF THE PAPER BOOK ARE ON THE ISSU E OF LAND FALLING WITHIN CATCHMENT AREA OF SUKHNA LAKE AND LITIGATION IN THIS CASE IS BEING VIGOROUSLY FOLLOW ED BY DEVELOPERS . THE ASSESSEE HAS NOT LED ANY EVIDENCE TO SHOW THAT EITHER THE HASH OR THDC HAVE SHOWN RELUCTANCE TO TAKE THE VARIOUS STEPS REQUIRED FOR EXECUTION OF PROJECT. THE LD. CIT DR ALSO CONTEND ED THAT IT WAS ARGUED ON BEHALF OF THE ASSESSEE THAT DEVEL OPER HAVE NOT MADE THE PAYMENTS AS AGREED IN THE JDA, W HICH IS NOT CORRECT. IN THIS CONNECTION, HE REFERRED TO CLAUSE 4 (IV) WHICH CLEARLY STATES THAT PAYMENT OF RS. 31,92,75,000/- WAS TO BE MADE TO THE OWNER AND OR RESPECTIVE MEMBERS OF THE OWNER WITHIN SIX MONTHS FROM THE DATE OF EXECUTION OF THIS AGREEMENT OR WITHIN TWO MONTHS FROM THE DATE OF APPROVAL OF PLAN / DESIGN AND THE GRANT AND DRAWINGS OF FINAL LICENSE TO DEVELOP WHE REUPON THE CONSTRUCTION CAN COMMENCE WHICH EVER IS LATER. THIS CLEARLY SHOWS THAT PAYMENTS WAS TO BE MADE ON HAPPENING OF TWO EVENTS AND THE TIME LIMIT WAS TO BE APPLIED ON THE EVENT TAKING PLACE LATER ON. AS PE R CLAUSE 3.3 OF THE THDC/HASH WAS REQUIRED TO TAKE PERMISSI ON FROM COMPETENT AUTHORITY AND THE COMPETENT AUTHOR ITY HAS BEEN DEFINED IN JDA AS PUNJAB URBAN PLANNING A ND DEVELOPMENT AUTHORITY (PUDA), DEPARTMENT OF TOWN A ND COUNTRY PLANNING, NAGAR PANCHYAT, NAYAGON, DEPARTM ENT OF LOCAL BODIES (PUNJAB) AND ANY OTHER AUTHORITY U NDER MUNICIPAL AUTHORITY. IT ALSO INCLUDES DEPARTMENT OF ENVIRONMENT, ELECTRICITY BOARD ETC. SINCE PERMISS ION FROM ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 75 DEPARTMENT OF ENVIRONMENT ETC WAS NOT AVAILABLE BE CAUSE OF ONGOING LITIGATION WHICH WAS FILED THROUGH A PI L, THEREFORE, IT CANNOT BE SAID THAT DEVELOPER WAS NO T WILING TO MAKE THE PAYMENT. AS PER THE JDA, THE PAYMENT W OULD BECOME DUE ONLY WHEN SUCH PERMISSION WERE GRANTED BY VARIOUS AUTHORITIES. IN FACT M/S HASH BUILDER WRO TE A LETTER ON 04.02.2011 THROUGH WHICH IT WAS STATED T HAT SINCE HIGH COURT HAS STAYED THE CONSTRUCTION, THER EFORE, PAYMENT COULD NOT BE MADE. FURTHER, AS PIL WAS FI LED IN THE HON'BLE HIGH COURT AND THE MATTER HAD GONE EVE N TO THE HON'BLE SUPREME COURT AND THDC/HASH HAS VIGOROUSLY DEFENDED THE SAME. THIS FACT CLEARLY S HOWS THAT DEVELOPER I.E. THDC/HASH WAS WILLING TO PERFO RM IN ALL RESPECTS TO THE JDA. (VII) IT WAS ALSO CONTENDED THAT THE SOCIETY HAS A LREADY TERMINATED THE CONTRACT AND IN THIS RESPECT REFERE NCE WAS MADE TO THE RESOLUTION PASSED BY GENERAL BODY OF T HE MEETING DATED 13.6.2011 AND LEGAL NOTICE WAS ISSUE D TO THDC/HASH. FIRST OF ALL, THERE IS NO EVIDENCE ON RECORD TO SHOW THAT SUCH NOTICE WAS SERVED UPON THDC/HASH . IN ANY CASE, AS CONTENDED EARLIER, POWER OF ATTORNEY COULD NOT HAVE BEEN REVOKED BECAUSE IT WAS IRREVOCABLE P OWER OF ATTORNEY AS PER CLAUSE 6.7 OF THE JDA. FURTHER, THERE WAS ARBITRATION CLAUSE AND THAT MEANS A NOTICE FOR ARBITRATION WAS REQUIRED TO GIVEN OTHERWISE SUCH U NILATERAL CANCELLATION WAS NOT VALID IN THE EYES OF LAW. IF THE JDA WAS CANCELED THEN THERE SHOULD BE DOCUMENT SHOWING RETURN OF WHATEVER POSSESSION WAS GIVEN BY THE SOC IETY. THE DOCUMENTS SHOWING CANCELLATION IS ONLY A SELF SERVING DOCUMENT, WHICH CANNOT BE RELIED TO REFUSE THE EXI STENCE OF JDA AND FACT OF GIVING POSSESSION BY THE SOCIET Y TO THE DEVELOPER. FURTHER, THE SUBSEQUENT EVENT CANNOT INVALIDATE THE CONTRACT FOR TRANSFER OF THE PROPER TY BECAUSE UNDER THE TAX LAWS INCOME HAS TO BE DETERM INED FOR EACH YEAR SEPARATELY AND ONCE TRANSFER TOOK EF FECT IN ASSESSMENT YEAR 2007-08, THEN A SUBSEQUENT EVENT TAKING PLACE IN 2011 WILL NOT HAVE ANY EFFECT ON S UCH TRANSFER. IT HAS BEEN CONTENDED THROUGH WRITTEN SUBMISSIONS THAT TOTAL CONSIDERATION OF THE PROPER TY WAS 2,37,03,75,000/- WHICH WAS CALCULATED AS UNDER:- (I) CONSIDERATION IN CASH (RS. 82,50,000 X 129 PLOTS) RS. 106,42,50,000/- ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 76 (II) CONSIDERATION IN KIND (RS. 101,25,000/- X 129 PLOTS) RS. 130,61,25,000/- TOTAL RS. 237,03,75,000/- THE ABOVE TOTAL CONSIDERATION WOULD BE ENHANCED FI GURE BECAUSE TOTAL CONSIDERATION RECEIVED AND OR AGREED AGAINST THE SALE OF PROPERTY BY THE MEMBERS IS RE QUIRED TO CONSIDER THE VALUE OF FLATS WHICH WERE CONTRACT ED TO BE RECEIVED BY THE MEMBERS. ON THE BASIS OF ABOVE CALCULATION, THE CONSIDERATION PER ACRE OF LAND WO ULD COME TO ABOUT RS. 11.18 CRORES WHEREAS SOCIETY HAD REGI STERED A SALE DEED FOR LAND MEASURING 3.08 ACRES FOR ONLY RS. 15.48 CRORES WHEREAS THE ACTUAL CONSIDERATION SHOU LD BE ` 34.43 CRORES. THIS ONLY SHOWS THAT VALUE OF THE F LATS TO BE RECEIVED WAS NOT REFLECTED IN SUCH SALE DEED. N OW, IF IT IS BELIEVED THAT CONTRACT WAS CANCELLED AND DEVELO PER WAS ALLOWED TO RETAIN THE LAND WHICH HAS ALREADY B EEN REGISTERED IN THE NAME OF DEVELOPER THEN WHAT WOUL D HAPPEN TO THE FLATS WHICH WERE TO BE RECEIVED BY T HE VARIOUS MEMBERS OF THE SOCIETY. NO LEGAL ACTION W AS TAKEN AGAINST THE DEVELOPER FOR RECOVERY OF BALANC E OF CONSIDERATION IN THE FORM OF FLATS. THIS ONLY GOE S TO PROVE THAT CANCELLATION IS ONLY A MAKE BELIEVE STORY AND ACTUALLY NO CANCELLATION HAS BEEN DONE. (VIII) IT WAS CONTENDED THAT THERE IS NO FORCE IN THE SUBMISSIONS THAT THE VALUE OF THE FLATS WHICH HAS NOT BEEN CONSTRUCTED, CANNOT BE INCLUDED IN THE TOTAL CONSI DERATION BECAUSE THAT WOULD BE A CASE OF TAXING THE NOTIONA L INCOME. HE REFERRED TO CLAUSE 4 OF THE JDA WHICH D EALS WITH THE CONSIDERATION AND POINTED OUT THAT ALLOTM ENT OF ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 77 FLAT WAS PART OF THE CONSIDERATION. AS PER THE RE SOLUTION OF THE EXECUTIVE BODY OF THE SOCIETY WHICH WAS LA TTER RATIFIED BY THE GENERAL BODY AS WELL AS THE TERMS OF THE JDA VERY CLEARLY SHOW THAT IN ADDITION TO MONETARY CONSIDERATION EACH MEMBER HAVING 500SQYD PLOT WAS ENTITLED TO RECEIVE ONE FULLY FURNISHED FLAT MEASU RING 2250 SQFT AND THE MEMBERS HOLDING 1000 SQYD PLOT WERE ENTITLED TO TWO SUCH FLATS. THIS CLEARLY SHOWS TH AT UPON ENTERING THE JDA, THE MEMBERS GOT VESTED RIGHTS TO RECEIVE SUCH FLATS AND THEREFORE, AS PER THE DEFI NITION OF CAPITAL GAIN IN SECTION 45 SUCH FLAT HAS ALSO ARO SEN FROM THE JDA AND THEREFORE, HAS TO BE INCLUDED IN THE TOTAL CONSIDERATION. HE AGAIN EMPHASIZED THAT RECEIPT O F CONSIDERATION HAS NOTHING TO DO WITH ITS TAXABILIT Y U/S 45 AND IT IS THE ACCRUAL OF CONSIDERATION WHICH MEANS A PORTION OF THE CONSIDERATION WHICH CAN BE RECEIVED LATER ALSO. HE ALSO SUBMITTED THAT AS FAR AS THE VALUE OF THE FLAT IS CONCERNED, THE SAME HAS BEEN TAKEN BY THE ASSESSING OFFICER ON THE BASIS OF AGREEMENT ENTER ED BETWEEN THDC AND HASH AMONG THEMSELVES AND THE RAT E ADOPTED IS THE SAME AT WHICH THDC HAD AGREED TO SE LL THE FLAT TO HASH. HE ALSO REFERRED TO A FEW PAPER BOO KS FILED BY OTHER ASSESSEES WHEREIN VARIOUS NEWS PAPER CLIP PING HAS BEEN INCLUDED WHICH CLEARLY SHOW THAT FLATS WE RE BOOKED @ RS. 8000/- APPROXIMATELY IN THE PRE LAUN CH BOOKINGS. SUCH PRE LAUNCH BOOKINGS GENERALLY TAKE PLACE AT LOWER RATES OFFERED THEN IN THE GENERAL BOOKING S BY THE PUBLIC. THEREFORE, THE VALUE OF RS. 4500/- IS MOS T REASONABLE WHICH HAS BEEN ADOPTED BY THE ASSESSING OFFICER. 26 IN THE REJOINDER, THE LD. COUNSEL OF THE ASSES SEE SUBMITTED THAT THE ASSESSEE AND SOCIETY HAD NEVER HANDED OVER THE POS SESSION, THEREFORE, THERE IS NO QUESTION OF EXECUTING THE DOCUMENTS AT THE TIME OF CANCELLATION OF THE AGREEMENT FOR REVERSING THE POSSESSION. AS NO POSSESSION WAS GIVEN, THEREFORE, THERE IS NO QUESTION OF TAKING THE BACK POSSESSION. HE FURTHER SUBMITTED: (A) THAT NORMAL RULES OF INTERPRETATION SHOULD BE A PPLIED TO UNDERSTAND THE MEANING OF CLAUSE (V) AND (VI) OF SECTION 2(47) AND THIS IS NOT A FIT CASE FOR INVOCATION OF HEYDONS RULE. HE SUBMITTED THAT LOT OF EMPHASIS HAS BEEN LAID BY THE LD. DR FOR THE REVENUE ON PARA 2.1 OF JDA TO PROVE THAT THE POSSESSION WAS HANDED OVER. HOWEVER, A CA REFUL READING OF THIS PARA WOULD SHOW THAT WHAT WAS CONTEMPLATED THR OUGH THIS PARA, WAS TO HAND OVER THE POSSESSION ON THE EXECUTION AND RE GISTRATION OF THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 78 AGREEMENT. WHEN AN AGREEMENT IS READ IT HAS TO BE READ IN WHOLE AND THEREFORE, IT MAY NOT BE PROPER TO IGNORE THE WORD REGISTERED. (B) HE ALSO CONTENDED THAT LOT OF EMPHASIS WAS GIVE N ON THE IRREVOCABILITY CLAUSE IN RESPECT OF SPECIAL POWER OF ATTORNEY WHICH IS NOT CORRECT BECAUSE ONCE THE JDA IS TERMINATED, IRREVOC ABLE POWER OF ATTORNEY WOULD COME TO AN END AUTOMATICALLY. (C) HE CONTENDED THAT SIMPLY SAYING THAT THE CANCEL LATION WAS AN UNILATERAL ACT OF THE ASSESSEE, WOULD NOT SERVE ANY PURPOSE BECAUSE THE REVENUE CAN NOT SIT IN THE JUDGMENT WHEN THE ASSESS EE SHOULD CANCEL THE AGREEMENT OR NOT. CLAUSE 14 OF THE JDA SPECIFI CALLY PROVIDED FOR TERMINATION OF THE AGREEMENT ONLY IN THE EVENT OF D EFAULT AND THE ASSESSEE WAS REQUIRED TO GIVE NOTICE OF 30 DAYS IN TERMS OF CLAUSE 14(IV) AND SUCH NOTICE HAS ALREADY BEEN GIVEN. JDA WAS EN TERED IN 2007 AND ENDED IN 2011 AND THAT IS WHY THE ASSESSEE WAS FORC ED TO CANCEL THIS AGREEMENT. IN ANY CASE THDC/HASH ARE NOT RELATED TO THE ASSESSEE, THEREFORE, IT WAS NOT POSSIBLE TO CREATE SELF SERV ING DOCUMENTS. 27. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND CAREFULLY GONE THROUGH THE WRITTEN SUBMISSIONS FILE D BY BOTH THE PARTIES IN THE LIGHT OF MATERIAL ON RECORD , PAPER BOOKS AND VARIOUS JUDGMENTS CITED BY THE PARTIES. THE MAIN ISSUE IS WHETHER ASSESSEE IS LIABLE TO CAPITAL GAIN TAX IN THE YEAR UNDER CONSIDERATION I.E ASSESSMENT YEAR 2007-08 IN VIEW OF THE JDA. FOR CHARGING CAPITAL G AINS, THE CHARGING SECTION IS 45 AND THE RELEVANT PORTION IS AS UNDER:- SECTION 45. [(1)] ANY PROFITS OR GAINS ARISING FRO M THE TRANSFER OF A CAPITAL ASSET EFFECTED IN THE PREVIOU S YEAR SHALL, SAVE AS OTHERWISE PROVIDED IN SECTIONS [54, 54B, [ [54D, [54E, [54EA, 54EB,] 54F [ 54G AND 54H], BE CHARGEABLE TO INCOME- TAX UNDER THE HEAD CAPITAL GAINS, AND SHALL BE DEEMED TO BE THE INCOME OF THE PREVIOUS YEAR IN WHICH THE TRANSFER TOOK PLACE. 28 THE PLAIN READING OF THE ABOVE PROVISION WOULD S HOW THAT CHARGING AN ITEM OF INCOME UNDER THE HEAD CAP ITAL GAINS REQUIRE THREE INGREDIENTS I.E. (I) THERE SHO ULD BE SOME PROFIT. (II) SUCH PROFIT MUST BE ARISING ON A CCOUNT OF TRANSFER AND (III) THERE SHOULD BE CAPITAL ASSET W HICH HAS BEEN TRANSFERRED. THERE IS NO DISPUTE THAT A CAPITA L ASSET WAS INVOLVED AND THERE WAS SOME PROFIT ALSO I.E. WH Y ASSESSEE HAS HIMSELF RETURNED INCOME UNDER THE HEAD CAPITAL GAINS;. THE DISPUTE IS MAINLY ON ACCOUNT OF TRANSFER AND THAT TOO WHETHER THE TRANSFER COULD BE COVERED ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 79 UNDER CLAUSES (II), (V) & (VI) OF SECTION 2(47) SO AS TO BRING INTO PICTURE THE WHOLE OF CONSIDERATION ARISING ON TRANSFER OF SUCH ASSETS. WE SHALL DEAL WITH EACH OF THE ASPE CT IN DETAIL AT APPROPRIATE TIME. 29. APART FROM CHARGING PROVISIONS U/S 45 ANOTHER IMPORTANT PROVISION IS SECTION 48 WHICH DEALS WITH THE MODE OF COMPUTATION AND RELEVANT PORTION READS AS UNDER:- 48. THE INCOME CHARGEABLE UNDER THE HEAD CAPITAL GAINS SHALL BE COMPUTED, BY DEDUCTING FROM THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF T HE TRANSFER OF THE CAPITAL ASSET THE FOLLOWING AMOUNTS, NAMELY : (I) EXPENDITURE INCURRED WHOLLY AND EXCLUSIVEL Y IN CONNECTION WITH SUCH TRANSFER; (II) THE COST OF ACQUISITION OF THE ASSET AND THE COST OF ANY IMPROVEMENT THERETO : 30 AGAIN PLAIN READING WOULD SHOW THAT CAPITAL GAIN WOULD BE COMPUTED BY CONSIDERING THE FULL VALUE OF CONSIDERATION WHETHER RECEIVED OR ACCRUING AS A RES ULT OF THE TRANSFER. THEREFORE, IT IS NOT ONLY THE CONSID ERATION RECEIVED WHICH IS RELEVANT BUT THE CONSIDERATION WH ICH HAS ACCRUED IS ALSO RELEVANT. 31. THE EXPRESSION TRANSFER HAS BEEN DEFINED U/S 2(47) OF THE ACT WHICH READS AS UNDER:- 2 (47) [TRANSFER, IN RELATION TO A CAPITAL ASSE T, INCLUDES, (I) THE SALE , EXCHANGE OR RELINQUISHMENT OF THE ASSET ; OR (II) THE EXTINGUISHMENT OF ANY RIGHTS THEREIN ; OR (III) THE COMPULSORY ACQUISITION THEREOF UNDER ANY LAW ; OR (IV) IN A CASE WHERE THE ASSET IS CONVERTED BY THE OWNER THEREOF INTO, OR IS TREATED 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; OR] [(V) ANY TRANSACTION INVOLVING THE ALLOWING OF T HE POSSESSION OF ANY IMMOVABLE PROPERTY TO BE TAKEN OR RETAINED IN PART PERFORMANCE OF A CONTRACT OF THE NATURE REFERRED TO IN SECTION 53A O F THE TRANSFER OF PROPERTY ACT, 1882 (4 OF 1882) ; OR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 80 (VI) ANY TRANSACTION (WHETHER BY WAY OF BECOMING A MEMBER OF, OR ACQUIRING SHARES IN, A CO-OPERATIVE SOCIETY, COMPAN Y OR OTHER ASSOCIATION OF PERSONS OR BY WAY OF ANY AGREEMENT O R ANY ARRANGEMENT OR IN ANY OTHER MANNER WHATSOEVER) WHIC H HAS THE EFFECT OF TRANSFERRING, OR ENABLING THE ENJOYMENT O F, ANY IMMOVABLE PROPERTY. EXPLANATION.FOR THE PURPOSES OF SUB-CLAUSES (V) AND (VI), IMMOVABLE PROPERTY SHALL HAVE THE SAME MEANING AS IN CLAUSE (D) OF SECTION 269UA ;] CLAUSES (V) & (VI) TO SECTION 2(47) OF THE ACT HAVE BEEN INSERTED BY FINANCE ACT, 1987 W.E.F. 1.4.1988. THE PURPOSE OF THIS INSERTION HAS BEEN EXPLAINED BY CBD T IN CIRCULAR NO. 495 DATED 22.9.1987. THE RELEVANT PAR T 11.1 AND 11.2 OF THE CIRCULAR READS AS UNDER:- 11.1 THE EXISTING DEFINITION OF THE WORD ' TRANSF ER ' IN SECTION 2(47) DOES NOT INCLUDE TRANSFER OF CERTAIN RIGHTS ACCRUIN G TO A PURCHASER, BY WAY OF BECOMING A MEMBER OR ACQUIRING SHARES IN A CO-OPERATIVE SOCIETY, COMPANY, OR AS WAY OF ANY AGREEMENT OR ANY ARRANGEMENT WHEREBY SUCH ANY BUILDING WHICH IS EITHER BEING CON STRUCTED OR WHICH IS TO BE CONSTRUCTED. TRANSACTIONS OF THE NATURE R EFERRED TO ABOVE ARE NOT REQUIRED TO BE REGISTERED UNDER THE REGISTRATIO N ACT, 1908. SUCH ARRANGEMENTS CONFER THE PRIVILEGES OF OWNERSHIP WIT HOUT TRANSFER OF TITLE IN THE BUILDING AND ARE A COMMON MODE OF ACQU IRING FLATS PARTICULARLY IN MULTI-STOREYED CONSTRUCTIONS IN BIG CITES. THE DEFINITION ALSO DOES NOT COVER CASES WHERE POSSESSION IS ALLOW ED TO BE TAKEN OR RETAINED IN PART PERFORMANCE OF A CONTRACT, OF T HE NATURE REFERRED TO IN SECTION 53A OF TRANSFER OF PROPERTY ACT, 1882. N EW SUB-CLAUSES (V) & (VI) HAVE BEEN INSERTED IN SECTION2(47) TO PREVEN T AVOIDANCE OF CAPITAL GAINS LIABILITY BY RECOURSE TO TRANSFER OF RIGHTS IN THE MANNER REFERRED TO ABOVE. 11.2 THE NEWLY INSERTED SUB-CLAUSE (VI) OF SECTION 2(47) HAS BROUGHT IN TO THE AMBIT OF TRANSFER, THE PRACTICE OF ENJOYMENT OF PROPERTY RIGHTS THROUGH WHAT IS COMMONLY KNOWN AS P OWER OF ATTORNEY ARRANGEMENTS. THE PRACTICE IN SUCH CASES I S ADOPTED NORMALLY WHERE TRANSFER OF OWNERSHIP IS LEGALLY NOT PERMITTED. A PERSON HOLDING THE POWER OF ATTORNEY IS AUTHORIZED THE POWERS OF OWNER, INCLUDING THAT OF MAKING CONSTRUCTION. THE LEGAL OWNERSHIP IN SUCH CASES CONTINUES TO BE WITH THE TRANSFEROR. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 81 32 BEFORE INSERTION OF THE CLAUSE (V) & (VI) TO SE CTION 2(47) OF THE ACT, THE POSITION OF LAW WAS THAT UNLE SS AND UNTIL A SALE DEED WAS EXECUTED FOR TRANSFER OF IMMO VABLE PROPERTY, THE SAME COULD NOT BE CONSTRUED AS TRANSF ER FOR THE PURPOSE OF CHARGING CAPITAL GAIN TAX. THIS WAS PARTICULARLY SO IN THE LIGHT OF VARIOUS JUDGMENTS PARTICULARLY THE JUDGMENT OF HON'BLE APEX COURT IN THE CASE OF ALAPATI VENKATRAMIAN V CIT (57 ITR 185) (SC ). IN THIS CASE IT WAS HELD THAT IN THE CONTEXT OF TRANSF ER FOR THE PURPOSE OF CAPITAL GAIN TAX, WHAT IS MEANT BY TRANS FER IS THE EFFECTIVE CONVEYANCE OF THE CAPITAL ASSET BY A TRANSFEROR TO THE TRANSFEREE. DELIVERY OF POSSESSI ON AND AGREEMENT TO SELL BY ITSELF COULD NOT CONSTITUTE CONVEYANCE OF THE IMMOVABLE PROPERTY. IN THE MEANT IME APART FROM THIS DECISION A PRACTICE CAME INTO VOGU E BY WHICH CERTAIN PROPERTIES WERE BEING TRANSFERRED WIT HOUT EXECUTING THE PROPER SALE DEEDS. THIS WAS BEING DO NE BECAUSE THERE WAS RESTRICTION ON SALE OF PROPERTIES IN VARIOUS TOWNS E.G. IN CASE OF LEASE HOLD PLOTS AND FLATS IN DELHI IF THE SAME WERE TO BE TRANSFERRED, PERMISSIO N WAS REQUIRED TO BE TAKEN FROM THE GOVERNMENT / DDA AND TRANSFEROR WAS REQUIRED TO PAY 50% OF THE MARKET VA LUE COST (I.E. UNEARNED INCREASE) TO THE GOVERNMENT. TO AVOID SUCH PAYMENTS AND / OR ALSO TO AVOID THE PAYMENT OF STAMP DUTY OR CUMBERSOME PROCEDURE OF OBTAINING PERMISSION, SOME PROPERTIES WERE BEING SOLD BY WAY OF SALE AGREEMENT AND ALSO EXECUTION OF GENERAL POWER OF ATTORNEY AND POSSESSION WAS GIVEN ON RECEIPT OF FUL L CONSIDERATION WITHOUT EXECUTING THE PROPER SALE DEE DS ETC. WHICH AS MENTIONED EARLIER WAS NOT EVEN PERMIS SIBLE IN SOME CASES. THESE TRANSACTIONS ARE POPULARLY CA LLED POWER OF ATTORNEY TRANSACTIONS. TO AVOID THESE AND TO STOP THE LEAKAGE OF REVENUE, THE PARLIAMENT HAS INS ERTED CLAUSES (V) & (VI) TO SECTION 2(47) SO AS SUCH TYPE OF TRANSACTIONS ARE ALSO BE BROUGHT IN TO TAXATION NET . HOWEVER, INTERPRETATIONS OF THESE CLAUSES HAS LED T O LOT OF LITIGATION AND THE MAIN POINT OF LITIGATION WAS TH AT AT WHAT POINT OF TIME THE POSSESSION CAN BE SAID TO HAVE BE EN GIVEN. IN THE PRESENT CASE, THE REVENUE HAS MAINLY RELIED ON TWO DECISIONS NAMELY (I) CHATURBHUJ DWARKADAS KAPADIA V CIT 260 ITR 491 (BOM.) AND; (II) AUTHORIT Y FOR ADVANCE RULING (AAR) NEW DELHI IN THE CASE OF JASBI R SINGH SARKARIA 294 ITR 196. 33. IN THE CASE OF CHATURBHUJ DWARKADAS KAPADIA V C IT (SUPRA), THE FACTS BEFORE THE HON'BLE BOMBAY HIGH COURT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 82 WERE THAT ASSESSEE WHO WAS AN INDIVIDUAL HAD 44/19 2 UNDIVIDED SHARE IN AN IMMOVABLE PROPERTY IN GREATER BOMBAY WHICH CONSISTED OF VARIOUS LANDS AND BUILDIN GS. BY AGREEMENT DATED AUGUST 18, 1994, THE ASSESSEE AGREED TO SELL TO FLOREAT INVESTMENT LTD, (HEREIN R EFERRED TO FLOREAT) HIS SHARE OF IMMOVABLE PROPERTY FOR A TOTAL CONSIDERATION OF RS. 1,85,63,220/- WITH RIGHT TO S AID FLOREAT TO DEVELOP THE PROPERTY IN ACCORDANCE WITH THE RULES / REGULATIONS FRAMED BY LOCAL AUTHORITIES. F OR THIS PURPOSE, THE ASSESSEE ALSO AGREED TO EXECUTE A LIMI TED POWER OF ATTORNEY AUTHORIZING FLOREAT TO DEAL WITH THE PROPERTY AND ALSO OBTAIN PERMISSIONS AND APPROVALS FROM VARIOUS AUTHORITIES. UNDER CLAUSE 11 OF THE AGREEM ENT, IT WAS PROVIDED THAT AFTER FLOREAT WAS GIVEN AN IRREVO CABLE LICENSE TO ENTER UPON THE ASSESSEES SHARE OF PROPE RTY AND AFTER FLORET INVESTMENT HAVE OBTAINED ALL NECES SARY APPROVALS, THE FLORET WAS ENTITLED TO DEMOLISH VARI OUS BUILDINGS FOR SETTLING THE CLAIMS OF THE TENANTS. U NDER CLAUSE 14 OF THE AGREEMENT, THE ASSESSEE WAS ENTITL ED TO RECEIVE PROPORTIONATE RENT TILL THE PAYMENT OF LAST INSTALLMENTS AND TILL THAT TIME ASSESSEE WAS BOUND TO PAY ALL OUTGOINGS. UNDER CLAUSE 20 OF THE AGREEMENT, IT WAS AGREED THAT SALE SHALL BE COMPLETED BY EXECUTION OF CONVEYANCE, HOWEVER, TILL THE MATTER WAS ADJUDICATE D BY THE HON'BLE HIGH COURT, NO CONVEYANCE WAS EXECUTED. PURSUANT TO THIS AGREEMENT, FLOREAT OBTAINED VARIOU S PERMISSIONS NAMELY (I) CLEARANCE FROM CRZ AUTHORITY DATED FEBRUARY 7, 1996; (II) LETTER FROM ULC FOR REDEVELOPMENT OF PROPERTY DATED APRIL 26, 1995. OT HER PERMISSIONS WERE ALSO OBTAINED DURING THE FINANCIAL YEAR ENDING MARCH 31, 1996 RELEVANT TO ASSESSMENT YEAR 1 996- 97. BY MARCH, 31, 1996, FLOREAT HAD PAID ALMOST TH E ENTIRE CONSIDERATION EXPECT FOR A SMALL SUM OF RS. 9,98,000/-. HOWEVER, THE COMMENCEMENT CERTIFICATE PERMITTING CONSTRUCTION OF THE BUILDING WAS ISSUED ON NOVEMBER 15, 1996. THE POWER OF ATTORNEY WAS EXECU TED ON MARCH 12, 1999. THE QUESTION AROSE WHETHER LIAB ILITY OF THE ASSESSEE FOR CAPITAL GAIN AROSE IN THE ASSES SMENT YEAR 1996-97 OR 1999-2000. THE OBSERVATION OF THE COURT HAS BEEN SUMMARIZED IN HEAD NOTE AS UNDER:- CLAUSES (V) AND (VI) WERE INTRODUCED IN SECTION 2( 47) OF THE INCOME-TAX ACT, 1961, WITH EFFECT FROM APRIL 1, 1988. THEY PROVIDE THAT TRANSFER INCLUDES (I) ANY TRANSACTION WHICH ALLOWS POSSESSION TO BE TAKEN/RETAINED IN PART PERFORMANCE OF A CONTRACT OF THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 83 NATURE REFERRED TO IN SECTION 53A OF THE TRANSFER O F PROPERTY ACT, 1882, AND (II) ANY TRANSACTION ENTERE D INTO IN ANY MANNER WHICH HAS THE EFFECT OF TRANSFER RING OR ENABLING THE ENJOYMENT OF ANY IMMOVABLE PROPERTY . THEREFORE, IN THESE TWO CASES CAPITAL GAINS WOULD B E TAXABLE IN THE YEAR IN WHICH SUCH TRANSACTIONS ARE ENTERED INTO, EVEN IF THE TRANSFER OF THE IMMOVABLE PROPERTY IS NOT EFFECTIVE OR COMPLETE UNDER THE GENERAL LAW. UNDER SECTION 2(47)(V) ANY TRANSACTION INVOLVING ALLOWING OF POSSESSION TO BE TAKEN OVER O R RETAINED IN PART PERFORMANCE OF A CONTRACT OF THE NATURE REFERRED TO IN SECTION 53A OF THE TRANSFER O F PROPERTY ACT WOULD COME WITHIN THE AMBIT OF SECTION 2(47)(V). IN ORDER TO ATTRACT SECTION 53A, THE FOLL OWING CONDITIONS NEED TO BE FULFILLED. THERE SHOULD BE A CONTRACT FOR CONSIDERATION ; IT SHOULD BE IN WRITIN G ; IT SHOULD BE SIGNED BY THE TRANSFEROR ; IT SHOULD PERT AIN TO TRANSFER OF IMMOVABLE PROPERTY ; THE TRANSFEREE SHOULD HAVE TAKEN POSSESSION OF THE PROPERTY ; LAST LY, THE TRANSFEREE SHOULD BE READY AND WILLING TO PERFO RM HIS PART OF THE CONTRACT. EVEN ARRANGEMENTS CONFIRMING PRIVILEGES OF OWNERSHIP WITHOUT TRANSFER OF TITLE COULD FALL UNDER SECTION 2(47)(V). SECTION 2( 47)(V) WAS INTRODUCED IN THE ACT FROM THE ASSESSMENT YEAR 1988-89 BECAUSE PRIOR THERETO, IN MOST CASES, IT WA S ARGUED ON BEHALF OF THE ASSESSEE THAT NO TRANSFER T OOK PLACE TILL EXECUTION OF THE CONVEYANCE. ASSESSEES USED TO ENTER INTO AGREEMENTS FOR DEVELOPING PROPERTIES WITH BUILDERS AND UNDER THE ARRANGEMENT WITH THE BUILDERS, THEY USED TO CONFER PRIVILEGES O F OWNERSHIP WITHOUT EXECUTING CONVEYANCE AND TO PLUG THAT LOOPHOLE, SECTION 2(47)(V) CAME TO BE INTRODUC ED IN THE ACT. . HELD, THAT SECTION 2(47)(V) READ WITH SECTION 45 INDICATES THAT CAPITAL GAINS WAS TAXABLE IN THE YEA R IN WHICH SUCH TRANSACTIONS WERE ENTERED INTO EVEN IF T HE TRANSFER OF IMMOVABLE PROPERTY IS NOT EFFECTIVE OR COMPLETE UNDER THE GENERAL LAW. IN THIS CASE, THE T EST HAD NOT BEEN APPLIED BY THE DEPARTMENT. NO REASON HAD BEEN GIVEN WHY THAT TEST HAD NOT BEEN APPLIED, PARTICULARLY WHEN THE AGREEMENT IN QUESTION, READ A S A WHOLE, SHOWED THAT IT WAS A DEVELOPMENT AGREEMENT. ONCE UNDER CLAUSE 8 OF THE AGREEMENT A ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 84 LIMITED POWER OF ATTORNEY WAS INTENDED TO BE GIVEN TO THE DEVELOPER TO DEAL WITH THE PROPERTY, THEN THE D ATE OF THE CONTRACT, VIZ., AUGUST 18, 1994, WOULD BE TH E RELEVANT DATE TO DECIDE THE DATE OF TRANSFER UNDER SECTION 2(47)(V) AND, IN WHICH EVENT, THE QUESTION OF SUBSTANTIAL PERFORMANCE OF THE CONTRACT THEREAFTER WOULD NOT ARISE 34. THE HON'BLE COURT REFERRED TO CLAUSES (V) & (VI) OF SECTION 2(47) AND MADE THE FOLLOWING OBSERVATIONS A T PAGE 499 OF THE REPORT: .. THE ABOVE TWO CLAUSES WERE INTRODUCED WITH EFFECT FROM APRIL 1,1988. THEY PROVIDE THAT TRANSF ER INCLUDES (I) ANY TRANSACTION WHICH ALLOWS POSSESSIO N TO BE TAKEN/RETAINED IN PART PERFORMANCE OF A CONTRACT OF THE NATURE REFERRED TO IN SECTION 53A OF THE TRANSFER OF PROPERTY ACT, AND (I I) ANY TRANSACTION ENTERED INTO IN ANY MANNER WHICH HAS THE EFFECT OF TRANSFERRING OR ENABLING THE ENJOYMENT OF ANY IMMOVABLE PROPERTY (SEE SECTION 269UA(D)). THEREFORE, IN THESE TWO CASES CAPITAL GAINS WOULD BE TAXABLE IN THE YEAR IN WHICH SUCH TRANSACTIONS ARE ENTERED INTO, EVEN IF THE TRANSFER OF THE IMMOVABLE PROPERTY IS NOT EFFECTIVE OR COMPLETE UNDER THE GENERAL LAW (SEE KANGA AND PALKHIVALAS LAW AND PRACTICE OF INCOME-TAX-VIII EDITION, PAGE 766). THIS TEST IS IMPORTANT TO DECIDE THE YEAR OF CHARGEABILITY OF THE CAPITAL GAINS. 35 THE ABOVE OBSERVATIONS WERE MADE ON THE BASIS OF OPINION EXPRESSED BY LD. AUTHOR IN THE COMMENTARY THE L AW AND PRACTICE OF INCOME TAX BY KANGA AND PALKHIVALA EIGHTH EDITION A T PAGE 766. RELEVANT OBSERVATIONS READ AS UNDER: CLS. (V) AND (VI) OF S. 2(47), INSERTED BY THE FIN ANCE ACT 1987 WITH EFFECT FROM 1 ST APRIL 1988, PROVIDE THAT TRANSFER INCLUDES (A) A NY TRANSACTION WHICH INVOLVES THE ALLOWING OF THE POSSESSION OF AN IMMOVABLE PROPERTY (S. 269UA(D)) TO BE TAKEN OR RETAINED IN PART PERFO RMANCE OF A CONTRACT OF THE NATURE REFERRED TO IN S.53A OF THE TRANSFER OF PROPERTY ACT 1882, AND (B) ANY TRANSACTION ENTERED INTO IN ANY MANNER WHICH HA S THE EFFECT OF TRANSFERRING, OR ENABLING THE ENJOYMENT OF, ANY IMM OVABLE PROPERTY (S. 269UA(D)). THEREFORE IN THESE TWO CASES CAPITAL GAI NS WOULD BE TAXABLE IN THE YEAR IN WHICH SUCH TRANSACTIONS ARE ENTERED INT O, EVEN IF THE TRANSFER OF THE IMMOVABLE PROPERTY IS NOT EFFECTIVE OR COMPLETE UNDER GENERAL LAW. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 85 36 FROM THE ABOVE, IT IS CLEAR THAT COURT WAS OF TH E VIEW THAT IN CASE ANY TRANSACTION COVERED BY CLAUSE (V) AND (VI) TO SECTION 2(47) THE LIABILITY FOR CAPITOL GAIN WOULD ARISE ON THE DATE WHEN SUCH TRANSACTIONS ARE ENTERE D INTO. IN THE JUDGMENT AT SOME OTHER PLACES, THE SIMILAR OBSERVATIONS HAVE BEEN MADE. HOWEVER, DESPITE THIS OBSERVATION THE CASE WAS DECIDED IN FAVOUR OF THE ASSESSEE. THE REASON FOR THE SAME HAVE BEEN GIVEN IN THE JUDGMENT ITSELF. FIRSTLY IT IS OBSERVED THAT PROVISION OF S ECTION 2(47)(V) OF THE ACT WERE NOT INVOKED BY THE REVENUE ITSELF. THIS BECOM ES CLEAR FROM THE FOLLOWING PARA: IT WAS ARGUED ON BEHALF OF THE ASSESSEE THAT THERE WAS NO EFFECTIVE TRANSFER TILL GRANT OF IRREVOCABLE LICENCE. IN THI S CONNECTION, THE JUDGMENT OF THE HON'BLE SUPREME COURT WERE CITED ON BEHALF OF T HE ASSESSEE, BUT ALL THOSE JUDGMENT WERE PRIOR TO INTRODUCTION OF THE CO NCEPT OF DEEMED TRANSFER U/S 2(47)(V). IN THIS MATTER, THE AGREEME NT IN QUESTION IS A DEVELOPMENT AGREEMENT. SUCH DEVELOPMENT AGREEMENTS DO NOT CONSTITUTE TRANSFER IN GENERAL LAW. THEY ARE SPREAD OVER A PER IOD OF TIME. THEY CONTEMPLATE VARIOUS STAGES. THE BOMBAY HIGH COURT I N VARIOUS JUDGMENTS HAS TAKEN THE VIEW IN SEVERAL MATTERS THAT THE OBJE CT OF ENTERING INTO A DEVELOPMENT AGREEMENT IS TO ENABLE A PROFESSIONAL B UILDER / CONTRACTOR TO MAKE PROFITS BY COMPLETING THE BUILDING AND SELLING THE FLATS AT A PROFIT. THAT THE AIM OF THESE PROFESSIONAL CONTRACTORS WAS ONLY TO MAKE PROFITS BY COMPLETING THE BUILDING AND, THEREFORE, NO INTEREST IN THE LAND STANDS CREATED IN THEIR FAVOUR UNDER SUCH AGREEMENTS. THAT SUCH AGREEMENTS ARE ONLY A MODE OF REMUNERATING THE BUILDER FOR HIS SER VICES OF CONSTRUCTING THE BUILDING (SEE GURUDEV DEVELOPERS V. KURLA KONKA N NIWAS CO- OPERATIVE HOUSING SOCIETY [2003] 3 MAH LJ 131). IT IS PRECISELY FOR THIS REASON THAT THE LEGISLATURE HAS INTRODUCED SECTION 2(47)(V) READ WITH SECTION 45 WHICH INDICATES THAT CAPITAL GAINS IS TA XABLE IN THE YEAR IN WHICH SUCH TRANSACTIONS ARE ENTERED INTO EVEN IF THE TRAN SFER OF IMMOVABLE PROPERTY IS NOT EFFECTIVE OR COMPLETE UNDER THE GEN ERAL LAW. IN THIS CASE THAT TEST HAS NOT BEEN APPLIED BY THE DEPARTMENT. N O REASON HAS BEEN GIVEN WHY THAT TEST HAS NOT BEEN APPLIED, PART ICULARLY WHEN THE AGREEMENT IN QUESTION, READ AS A WHOLE, SHOWS THAT IT IS A DEVELOPMENT AGREEMENT. THERE IS A DIFFERENCE BETWEE N THE CONTRACT ON THE ONE HAND AND THE PERFORMANCE ON THE OTHER HA ND. IN THIS CASE, THE TRIBUNAL AS WELL AS THE DEPARTMENT HAVE COME TO THE CONCLUSION THAT THE TRANSFER TOOK PLACE DURING THE ACCOUNTING YEAR ENDING MARCH 31,1996, AS SUBSTANTIAL PAYMENTS WERE EFFECTED DURING THAT Y EAR AND SUBSTANTIAL PERMISSIONS WERE OBTAINED. IN SUCH CASES OF DEVELOP MENT AGREEMENTS, ONE CANNOT GO BY SUBSTANTIAL PERFORMANCE OF A CONTR ACT. IN SUCH CASES, THE YEAR OF CHARGEABILITY IS THE YEAR IN WHICH THE CONTRACT IS EXECUTED. THIS IS IN VIEW OF SECTION 2 (47)(V) OF T HE ACT. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 86 SECONDLY IT IS MENTIONED IN THE ORDER OF THE COURT THAT LAW WAS NOT VERY CLEAR ON THIS POINT AND SINCE THE ASSESSEE HAS ADMI TTED AND PAID CAPITAL GAIN IN THE ASSESSMENT YEAR 1999-2000, THEREFORE, TAX WAS HELD TO BE CHARGEABLE IN ASSESSMENT YEAR 1999-2000. THIRDLY CERTAIN SHORTCOMINGS WERE ALSO NOTED IN TH E ORDER OF THE TRIBUNAL WHERE CERTAIN DOCUMENTS WERE MENTIONED TO HAVE BEEN EXECUTED BEFORE MARCH 31, 1996 E.G. THE FOLLOW ING OBSERVATION OF THE TRIBUNAL WAS NOT FOUND CORRECT A S SOMETHING IS DONE ON IST APRIL, 1997 THEN THE SAME CANNOT FALL IN THE YEAR ENDING 31.3.1996. FROM THE DATES IT IS EVIDENT THAT FROM THE VERY NE XT DAY, I.E., APRIL 1, 1997, FROM THE END OF THE FINANCIAL YEAR ENDING ON MARCH 31, 1996, THE BUILDER WAS USING THE WELL WATER AGAINST PAYMENT OF RELEVANT CHARGES TO THE ASSESSEE. 37 THUS IT IS VERY CLEAR THAT IN CASES WHERE AN ARRANGEMENT HAD BEEN ENTERED INTO BY AN ASSESSEE IN TERMS OF CLAUSE (V) OF SECTION 2(47) WHICH HAS EFFE CT OF HANDING OVER THE POSSESSION THEN THE TRANSFER IS SA ID TO HAVE BEEN TAKEN PLACE ON THE DATE OF ENTERING INTO SUCH ARRANGEMENT. 38. WE DO NOT FIND ANY FORCE IN THE CONTENTION OF T HE LD. COUNSEL FOR THE ASSESSEE THAT JUDGMENT HAS TO BE R EAD IN THE CONTEXT OF THE DECISION MADE IN SUCH JUDGMENT. IN FACT, IT IS WELL SETTLED THAT DOCTRINE OF PRECEDENT WHICH MEANS WHAT NEEDS TO BE FOLLOWED LATER ON PARTICULAR LY BY SUBORDINATE TRIBUNALS AND COURTS IS THE RATIO OF A PARTICULAR JUDGMENT GIVEN BY THE HIGHER COURT OR FO RUM. FURTHER, THERE IS NO FORCE IN THE CONTENTION THAT D ECISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CHATURBHUJ DWARKADAS KAPADIA V CIT (SUPRA) DOES NOT SHOW THAT THE DATE OF AGREEMENT ITSELF CONSTITUTE T HE TRANSFER. AGAIN THERE IS NO FORCE EVEN IN THE CONT ENTION THAT IN THAT CASE IT WAS ULTIMATELY DECIDED THAT CA PITAL GAIN TAXES IS CHARGEABLE IN ASSESSMENT YEAR 1999-20 00 BECAUSE OF THE REASONS GIVEN IN ABOVE NOTED PARAS PARTICULARLY BECAUSE THE REVENUE ITSELF NEVER INVOK ED THE PROVISIONS OF SECTION 2(47)(V) OF THE ACT AND HELD IT TO BE TAXABLE IN ASSESSMENT YEAR 1996-97. NO DOUBT IN TH AT CASE ULTIMATELY IT WAS HELD THAT CAPITAL GAIN WAS I N ASSESSMENT YEAR 1999-2000 BUT COURT HAD MADE IT VER Y CLEAR THAT THIS IS FIRST TIME THAT LAW IS BEING LAI D DOWN AND ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 87 GUIDELINES ARE BEING ISSUED WHICH MEANS THAT THERE WAS A CONFUSION EARLIER. CLAUSES (V) & (VI) TO SECTION 2 (47) WERE INTRODUCED IN THE YEAR ONLY IN 1998. PERHAPS COURT TOOK A LENIENT VIEW BECAUSE OF THESE REASONS AND HELD THAT CAPITAL GAIN WAS TAXABLE IN ASSESSMENT YEAR 1999-20 00. IT IS QUITE CLEAR THAT RATIO OF THE ABOVE DECISION IS THAT IN CASE OF ANY ARRANGEMENTS OR TRANSACTIONS WHEREBY THE OTHER PARTY BECOMES ENTITLED TO ENJOY THE PROPE RTY THEN THAT DATE OF SUCH TRANSACTION ITSELF NEEDS TO BE CONSTRUED AS THE DATE OF TRANSFER. 39. THE SECOND RELEVANT DECISION CITED BY THE REVEN UE IS BY AUTHORITY FOR ADVANCE RULING (AAR) NEW DELHI IN THE CASE OF JASBIR SINGH SARKARIA (SUPRA) . IN THAT CASE THE ASSESSEE WAS CO-OWNER OF AGRICULTURAL LAND MEASURIN G ABOUT 27.7 ACRES AND HIS SHARE WAS 4/9. THE CO-OWN ER DECIDED TO DEVELOP THE LAND BY CONSTRUCTING RESIDEN TIAL COMPLEX THROUGH DEVELOPER AND ENTERED INTO A COLLABORATION AGREEMENT ON 8.6.2005 WITH M/S SANTUR DEVELOPER PVT LTD, NEW DELHI (HEREIN AFTER CALLED DEVELOPER). ACCORDING TO THE TERMS OF AGREEMENT, THE DEVELOPER SHOULD OBTAIN A LETTER OF INTENT FROM THE CONCERNED GOVERNMENT DEPARTMENT AND OBTAIN OTHER PERMISSIONS AND SANCTIONS FOR DEVELOPING THE LAND A T ITS OWN RISK AND COST. THE DEVELOPER WAS TO TAKE 84% O F THE BUILT UP AREA AND BALANCE 16% WOULD BELONG TO ASSES SEE AND OTHER CO-OWNER. THE CONSIDERATION FOR THE AGREE MENT WAS TAKEN AS THE BUILT UP AREA TO BE HANDED OVER TO THE OWNERS FREE OF COST. THE OWNERS WERE ENTITLED TO V ISIT THE SITE IN ORDER TO REVIEW THE PROGRESS OF THE PROJECT . IT WAS CLARIFIED BY CLAUSE 18 THAT OWNERSHIP WOULD REMAIN EXCLUSIVELY WITH THE OWNERS TILL IT VESTS WITH BOTH THE PARTIES AS PER THEIR RESPECTIVE SHARES ON THE COMPL ETION OF THE PROJECT. THE OTHER CLAUSES AND THE STEPS IN THE AGREEMENT WERE THAT A SUM OF RS. 1 CRORE TOWARDS PAYMENT OF EARNEST MONEY AT THE TIME OF ENTERING IN TO AGREEMENT; A SPECIAL POWER OF ATTORNEY WAS TO BE EXECUTED IN FAVOUR OF THE DEVELOPER TO ENABLE TO DE AL WITH THE STATUTORY AUTHORITIES ETC. FOR OBTAINING NECESS ARY APPROVALS / SANCTIONS; LETTER OF INTENT WAS TO BE OBTAINED NOT LATER THAN MARCH 8, 2006 AND IN CASE OF A FAILU RE TO DO SO, THE AGREEMENT SHALL STAND TERMINATED. LETTER O F INTENT IS BASICALLY A LICENSE GRANTED BY THE DIRECTOR OF T OWN PLANTING TO DEVELOPER OF LAND FOR THE PURPOSE OF CONSTRUCTING RESIDENTIAL FLATS SUBJECT TO PAYMENT O F CERTAIN CHARGES AND COMPLIANCE OF OTHER CONDITIONS. IT WAS FURTHER STATED IN THE AGREEMENT THAT ON FULFILLMENT OF THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 88 REQUIREMENT IN THE LETTER OF INTENT, OWNERS WILL HA VE TO EXECUTE IRREVOCABLE GENERAL POWER OF ATTORNEY IN FA VOUR OF THE DEVELOPER AUTHORIZING THE DEVELOPER TO TOOK AND SELL THE DWELLING UNITS OUT OF DEVELOPERS SHARE AND COL LECT THE MONEY FOR THE SAME. HOWEVER, FINALLY SALE DEEDS COU LD BE EXECUTED ONLY AFTER THE OWNER RECEIVED THEIR SHARE OF CONSTRUCTED AREA. THREE MONTHS LATER, A SUPPLEMENT ARY AGREEMENT WAS ENTERED ON SEPTEMBER 15, 2005 BETWEEN THE ASSESSEE AND OTHER CO-OWNERS AND DEVELOPERS THROUGH WHICH IT WAS AGREED THAT OWNERS WILL SELL T HEIR 16% SHARE IN THE BUILT UP AREA TO THE DEVELOPER OR ITS NOMINEE FOR CONSIDERATION OF RS. 42 CRORES. A SUM O F RS. 2 CRORES WAS RECEIVED. THIS COLLABORATION AGREEMENT AND BALANCE OF RS. 40 CRORES WAS PAYABLE BY THE DEVELOP ER TO THE OWNERS IN SIX INSTALLMENTS FROM MARCH 06, 2008. THE INSTALLMENTS COULD BE EXTENDED SUBJECT TO PAYMENT O F INTEREST AND FURTHER SUBJECT TO MAXIMUM EXTENSION O F THREE MONTHS. THERE WERE VARIOUS OTHER CLAUSES WHI CH ARE NOT RELEVANT FOR OUR PURPOSES. THE QUESTION AR OSE WHETHER CAPITAL GAIN ACCRUE / ARISE TO THE ASSESSEE DURING THE FINANCIAL YEAR 2006-07 RELEVANT TO ASSESSMENT Y EAR 2007-08 OR DURING FINANCIAL YEAR 2007-08 RELEVANT T O ASSESSMENT YEAR 2008-09. 40. ON THE ABOVE, THE HON'BLE AUTHORITY AFTER REFER RING TO THE PROVISIONS OF SECTION 45 AND OBSERVED AS UNDER: - .THE SECTION CAN BE ANALYSED THUS : (A) TRANSFER OF A CAPITAL ASSET EFFECTED IN THE PRE VIOUS YEAR, (B) RESULTANT PROFITS OR GAINS FROM SUCH TRANSFER, (C) THOSE PROFITS OR GAINS WOULD CONSTITUTE THE INC OME OF THE ASSESSEE/ TRANSFEROR (D) SUCH INCOME SHALL BE DEEMED TO BE THE INCOME OF THE SAME PREVIOUS YEAR IN WHICH THE TRANSFER HAD TAKEN PLACE . TWO ASPECTS MAY BE NOTED AT THIS JUNCTURE. FIRSTLY , THE EXPRESSION USED IS ARISING WHICH IS NOT TO BE EQUATED WITH THE E XPRESSION RECEIVED. BOTH THESE EXPRESSIONS AND IN ADDITION THERETO, TH E EXPRESSION ACCRUE ARE USED IN THE INCOME-TAX ACT EITHER COL LECTIVELY OR SEPARATELY ACCORDING TO THE CONTEXT AND NATURE OF T HE CHARGING PROVISION. THE SECOND POINT WHICH DESERVES NOTICE IS THAT BY A ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 89 DEEMING PROVISION, THE PROFITS OR GAINS THAT HAVE A RISEN WOULD BE TREATED AS THE INCOME OF THE PREVIOUS YEAR IN WHICH THE TRANSFER TOOK PLACE. THAT MEANS, THE INCOME ON ACCOUNT OF ARISAL OF CAPITAL GAIN SHOULD BE CHARGED TO TAX IN THE SAME PREVIOUS YEAR IN WHICH THE TRANSFER WAS EFFECTED OR DEEMED TO HAVE TAKEN PLAC E. THE EFFECT AND AMBIT OF THE DEEMING PROVISION CONT AINED IN SECTION 45 HAS BEEN CONSIDERED IN DECIDED CASES AND LEADIN G TEXT BOOKS. THE FOLLOWING STATEMENT OF LAW IN SAMPATH IYENGARS CO MMENTARY (10TH EDITION REVISED BY SHRI S. RAJARATNAM) BRINGS OUT THE CORRECT LEGAL POSITION : SECTION 45 ENACTS THAT THE CAPITAL GAINS SHALL BY FICTION BE DEEMED TO BE THE INCOME OF THE PREVIOUS YEAR IN WHICH THE TRANSFER TOOK PLACE. SINCE THIS IS A STATUTORY FICTION, THE ACTU AL YEAR IN WHICH THE SALE PRICE WAS RECEIVED, WHETHER IT WAS ONE YEAR, T WO YEARS, THREE YEARS, FOUR YEARS ETC. PREVIOUS TO THE PREVIOUS YEA R OF TRANSFER, IS BESIDE THE POINT. THE ENTIRETY OF THE SUM OR SUMS R ECEIVED IN ANY EARLIER YEAR OR YEARS WOULD BE REGARDED AS THE CAPI TAL GAINS ARISING IN THE PREVIOUS YEAR OF TRANSFER. . . . . IN THE WORDS OF SECTION 45, THE CAPITAL GAI NS ARISING FROM THE TRANSFER 'SHALL BE THE INCOME OF THE PREVIOUS YEAR IN WHICH THE TRANSFER TOOK PLACE'. SO, THE PAYMENTS OF CONSIDER ATION STIPULATED TO BE PAID IN FUTURE WOULD HAVE TO BE ATTRIBUTED, BY STATUTORY MANDATE, TO THE YEAR OF TRANSFER, EVEN AS PAYMENTS MADE PRIOR TO THE YEAR OF TRANSFER. 41. THEREAFTER, THE AUTHORITY REFERRED TO SECTION 2(47) AND OBJECTS OF THE INTRODUCTION OF CLAUSES (V) & (V I) AND ALSO REFERRED TO PARAS 11.1 & 11.2 OF THE BOARD CIR CULAR NO. 495 (WHICH WE HAVE ALREADY DISCUSSED EARLIER). THE HON'BLE AUTHORITY HAS DISCUSSED VARIOUS IMPLICATION S OF CLAUSE (V) OF SECTION 2(47) AND ALSO IMPLICATION OF SECTION 53A OF THE TRANSFER OF PROPERTY ACT AS WELL AS OBSERVATIONS OF HON'BLE BOMBAY HIGH COURT IN THE CA SE OF CHATURBHUJ DWARKADAS KAPADIA V CIT (SUPRA). THE AUTHORITY OBSERVED THAT TO UNDERSTAND THIS PROVISIO N PROPERLY MEANING OF POSSESSION HAS TO BE UNDERSTO OD PROPERLY AND WENT ON TO DISCUSS THE MEANING OF TERM POSSESSION, AND HOW THE SAME IS TO BE UNDERSTOOD I N THE CONTEXT OF CLAUSE (V). THESE ARE VERY IMPORTANT OBSERVATIONS AND HAVE BEEN DISCUSSED IN MOST ELUCID ATED FASHION. THESE OBSERVATIONS WILL ANSWER MANY OF THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 90 QUESTIONS RAISED BEFORE US AND, THEREFORE, WE ARE EXTRACTING THESE OBSERVATIONS AS UNDER:- MEANING OF POSSESSION AND HOW SHOULD IT BE UNDE RSTOOD IN THE CONTEXT OF CLAUSE (V) THE NEXT QUESTION IS, IN WHAT SENSE WE HAVE TO UND ERSTAND THE TERM POSSESSION IN THE CONTEXT OF CLAUSE (V) OF SECTION 2(47). SHOULD IT ONLY MEAN THE RIGHT TO EXCLUSIVE POSSESS IONWHICH THE TRANSFEREE CAN MAINTAIN IN HIS OWN RIGHT TO THE EX CLUSION OF EVERYONE INCLUDING THE TRANSFEROR FROM WHOM HE DERIVED THE P OSSESSION ? SUCH A CRITERION WILL BE SATISFIED ONLY AFTER THE ENTIR E SALE CONSIDERATION IS PAID AND THE TRANSFEROR HAS FORFEITED HIS RIGHT TO EXERCISE ACTS OF POSSESSION OVER THE LAND OR TO RESUME POSSESSION. I N OUR VIEW, THERE IS NO WARRANT TO PLACE SUCH A RESTRICTED INTERPRETA TION ON THE WORD POSSESSION OCCURRING IN CLAUSE (V) OF SECTION 2(4 7). POSSESSION IS AN ABSTRACT CONCEPT. IT HAS DIFFERENT SHADES OF MEA NING. IT IS VARIOUSLY DESCRIBED AS A POLYMORPHOUS TERM HAVING DIFFERENT MEANINGS IN DIFFERENT CONTEXTS (PER R. S. SARKARI A J. IN SUPERINTENDENT AND REMEMBRANCE OF LEGAL AFFAIRS, W. B. V. ANIL KUMAR BHUNJA [1979] 4 SCC 274 AND AS A WORD OF OP EN TEXTURE (SEE SALMOND ON JURISPRUDENCE, PARAGRAPH 51, TWELF TH EDITION, INDIAN REPRINT). SALMOND OBSERVED : TO LOOK FOR A DEFINITION THAT WILL SUMMARIZE THE MEANINGS OF THE TERM POSSESSION IN ORDINARY LANGUAGE, IN ALL AREAS OF LAW AND IN ALL LEGAL SYST EMS, IS TO ASK FOR THE IMPOSSIBLE. IN THE ABOVE CASE OF ANIL KUMAR BHUNJA [1979] 4 SCC 274, SARKARIA J. SPEAKING FOR A THREE-JUDGE BENCH A LSO REFERRED TO THE COMMENTS OF DIAS AND HUGHES IN THEIR BOOK ON JURISP RUDENCE THAT IF A TOPIC EVER SUFFERED TOO MUCH THEORIZING IT IS TH AT OF POSSESSION. MUCH OF THE DIFFICULTY IS CAUSED BY THE FACT THAT POSSESSION IS NOT A PURE LEGAL CONCEPT, AS POINTED OUT BY SALMOND. THE LEARNED JUDGE THEN EXPLAINED THE CONNOTATION OF THE EXPRESSION POSSESSION BY REFERRING TO THE WELL KNOWN TREATISES ON JURISPRUD ENCE (PAGE 278) : POSSESSION, IMPLIES A RIGHT AND A FACT : THE RIG HT TO ENJOY ANNEXED TO THE RIGHT TO PROPERTY AND THE FACT OF T HE REAL INTENTION. IT INVOLVES POWER OF CONTROL AND INTENT TO CONTROL, (SEE DIAS AND HUGHES) 14 . . . . 15. WHILE RECOGNIZING THAT POSSESSION IS NOT A PU RELY LEGAL CONCEPT BUT ALSO A MATTER OF FACT, SALMOND (12TH ED ., 52) DESCRIBES POSSESSION, IN FACT, AS A RELATIONSHIP B ETWEEN A ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 91 PERSON AND A THING. ACCORDING TO THE LEARNED AUTHO R, THE TEST FOR DETERMINING WHETHER A PERSON IS IN POSSESSION OF ANYTHING IS WHETHER HE IS IN GENERAL CONTROL OF IT. IN SALMONDS JURISPRUDENCE, AT PARAGRAPH 54, WE FI ND AN ILLUMINATING DISCUSSION ON IMMEDIATE AND MED IATE POSSESSION. THE LEARNED AUTHOR STATES IN LAW ONE PERSON MAY POSSESS A THING FOR AND ON ACCOUNT OF SOME ONE ELSE. IN SUCH A CASE THE LATTER IS IN POSSESSION BY THE AGEN CY OF HIM WHO SO HOLDS THE THING ON HIS BEHALF. THE POSSESSI ON THUS HELD BY ONE MAN THROUGH ANOTHER MAY BE TERMED MEDI ATE, WHILE THAT WHICH IS ACQUIRED OR RETAINED DIRECTLY OR PERSONALLY MAY BE DISTINGUISHED AS IMMEDIATE OR DIRECT. SA LMOND MAKES REFERENCE TO THREE TYPES OF MEDIATE POSSESSIO N. IN ALL CASES OF MEDIATE POSSESSION, TWO PERSONS ARE IN P OSSESSION OF THE SAME THING AT THE SAME TIME. AN ALLIED CONCE PT OF CONCURRENT POSSESSION HAS ALSO BEEN EXPLAINED IN P ARAGRAPH 55 OF SALMONDS JURISPRUDENCE IN THE FOLLOWING WOR DS : IT WAS A MAXIM OF THE CIVIL LAW THAT TWO PERSONS C OULD NOT BE IN POSSESSION OF THE SAME THING AT THE SAME TIME. AS A GENERAL PROPOSITION THIS IS TRUE : FOR EXCLUSIVENES S IS OF THE ESSENCE OF POSSESSION. TWO ADVERSE CLAIMS OF EXCLU SIVE USE CANNOT BOTH BE EFFECTUALLY REALIZED AT THE SAME TI ME. CLAIMS, HOWEVER, WHICH ARE NOT ADVERSE, AND WHICH ARE NOT, THEREFORE, MUTUALLY DESTRUCTIVE, ADMIT OF CONCURRENT REALIZATI ON. HENCE, THERE ARE SEVERAL POSSIBLE CASES OF DUPLICATE POSS ESSION. 1. MEDIATE AND IMMEDIATE POSSESSION CO-EXIST IN RESPECT OF THE SAME THING AS ALREADY EXPLAINED. 2. TWO OR MORE PERSONS MAY POSSESS THE SAME THING IN COMMON, JUST AS THEY MAY OWE IT IN COMMON . ON A FAIR AND REASONABLE INTERPRETATION AND ON ADO PTING THE PRINCIPLE OF PURPOSIVE CONSTRUCTION, IT MUST B E HELD THAT POSSESSION CONTEMPLATED BY CLAUSE (V) NEED NOT NEC ESSARILY BE SOLE AND EXCLUSIVE POSSESSION. SO LONG AS THE T RANSFEREE IS, BY VIRTUE OF THE POSSESSION GIVEN, ENABLED TO E XERCISE GENERAL CONTROL OVER THE PROPERTY AND TO MAKE USE O F IT FOR THE INTENDED PURPOSE, THE MERE FACT THAT THE OWNER HAS ALSO THE RIGHT TO ENTER THE PROPERTY TO OVERSEE THE DEV ELOPMENT WORK OR TO ENSURE PERFORMANCE OF THE TERMS OF AGRE EMENT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 92 DOES NOT INTRODUCE ANY INCOMPATIBILITY. THE CONCURR ENT POSSESSION OF THE OWNER WHO CAN EXERCISE POSSESSORY RIGHTS TO A LIMITED EXTENT AND FOR A LIMITED PURPOSE AND T HAT OF THE BUYER/DEVELOPER WHO HAS A GENERAL CONTROL AND CUST ODY OF THE LAND CAN VERY WELL BE RECONCILED. CLAUSE (V) OF SECTION 2(47) WILL HAVE ITS FULL PLAY EVEN IN SUCH A SITUAT ION. THERE IS NO WARRANT TO POSTPONE THE OPERATION OF CLAUSE (V) AND THE RESULTANT ACCRUAL OF CAPITAL GAIN TO A POINT OF TIM E WHEN THE CONCURRENT POSSESSION WILL BECOME EXCLUSIVE POSSESS ION OF DEVELOPER/TRANSFEREE AFTER HE PAYS FULL CONSIDERATI ON. FURTHER, IF POSSESSION REFERRED TO IN CLAUSE (V) IS TO BE UNDERSTOOD AS EXCLUSIVE POSSESSION OF THE TRANSFEREE/DEVELOPER, THEN, THE VERY PURPOSE OF THE AMENDMENT EXPANDING THE DEFINITION OF TRANSFER FOR THE PURPOSE OF CAPITAL GAINS MAY BE DEFEATED. THE REASO N IS THIS: THE OWNER OF THE PROPERTY CAN VERY WELL CONTE ND, AS IS BEING CONTENDED IN THE PRESENT CASE, THAT THE DEVEL OPER WILL HAVE SUCH EXCLUSIVE POSSESSION IN HIS OWN RIGHT ONL Y AFTER THE ENTIRE AMOUNT IS PAID TO THE OWNER TO THE LAST PIE. THERE IS THEN A POSSIBILITY OF STAGGERING THE LAST INSTAL MENT OF A SMALL AMOUNT TO A DISTANT DATE, MAY BE, WHEN THE EN TIRE BUILDING COMPLEX GETS READY. EVEN IF SOME AMOUNT, S AY 10 PER CENT., REMAINS TO BE PAID AND THE DEVELOPER/TRA NSFEREE FAILS TO PAY, LEADING TO A DISPUTE BETWEEN THE PART IES, THE RIGHT TO EXCLUSIVE AND INDEFEASIBLE POSSESSION MAY BE IN JEOPARDY. IN THIS STATE OF AFFAIRS, THE TRANSACTION WITHIN THE MEANING OF CLAUSE (V) CANNOT BE SAID TO HAVE BEEN EFFECTED AND THE LIABILITY TO PAY CAPITAL GAINS MAY BE INDEF INITELY POSTPONED. TRUE, IT MAY NOT BE PROFITABLE FOR THE DEVELOPER TO ALLOW THIS SITUATION TO LINGER FOR LONG AS THE P ROCESS OF TRANSFER OF FLATS TO THE PROSPECTIVE PURCHASERS WIL L GET DELAYED. AT THE SAME TIME, THE OTHER SIDE OF THE PI CTURE CANNOT BE OVER-LOOKED. THERE IS A POSSIBILITY OF TH E OWNER WITH THE CONNIVANCE OF THE TRANSFEREE POSTPONING TH E PAYMENT OF CAPITAL GAINS TAX ON THE OSTENSIBLE GRO UND THAT THE ENTIRE CONSIDERATION HAS NOT BEEN RECEIVED AND SOME BALANCE IS LEFT. THE MISCHIEF SOUGHT TO BE REMEDIED , WILL THEN PERPETUATE. WE ARE, THEREFORE OF THE VIEW THAT POSS ESSION GIVEN TO THE DEVELOPERS NEED NOT RIPEN ITSELF INTO EXCLUSIVE POSSESSION ON PAYMENT OF ALL THE INSTALMENTS IN EN TIRETY FOR THE PURPOSE OF DETERMINING THE DATE OF TRANSFER. WHILE ON THE POINT OF POSSESSION, WE WOULD LIKE TO CLARIFY ONE MORE ASPECT. WHAT IS SPOKEN TO IN CLAU SE (V) OF ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 93 SECTION 2(47) IS THE TRANSACTION WHICH INVOLVES A LLOWING THE POSSESSION TO BE TAKEN. BY MEANS OF SUCH TRANSACTIO N, A TRANSFEREE LIKE A DEVELOPER IS ALLOWED TO UNDERTAKE DEVELOPMENT WORK ON THE LAND BY ASSUMING GENERAL CO NTROL OVER THE PROPERTY IN PART PERFORMANCE OF THE CONTR ACT. THE DATE OF THAT TRANSACTION DETERMINES THE DATE OF TR ANSFER. THE ACTUAL DATE OF TAKING PHYSICAL POSSESSION OR THE IN STANCES OF POSSESSORY ACTS EXERCISED IS NOT VERY RELEVANT. THE ASCERTAINMENT OF SUCH DATE, IF CALLED FOR, LEADS TO COMPLICATED INQUIRIES, WHICH MAY FRUSTRATE THE OBJE CTIVE OF THE LEGISLATIVE PROVISION. IT IS ENOUGH IF THE TRAN SFEREE HAS, BY VIRTUE OF THAT TRANSACTION, A RIGHT TO ENTER UPON A ND EXERCISE ACTS OF POSSESSION EFFECTIVELY PURSUANT TO THE COVE NANTS IN THE CONTRACT. THAT TANTAMOUNTS TO LEGAL POSSESSION . WE ARE REFERRING TO THIS ASPECT BECAUSE THE AUTHORIZED REPRESENTATIVE HAS SUBMITTED WHEN HE APPEARED BEFO RE US IN THE LAST WEEK OF MAY, 2007, THAT EVEN BY THAT DA TE THE DEVELOPMENT WORK COULD NOT BE COMMENCED FOR WANT OF CERTAIN APPROVALS, AND THEREFORE, THE DEVELOPER WA S NOT WILLING TO TAKE POSSESSION OF THE LAND. SUCH AN UNSUBSTANTIATED STATEMENT WHICH IS NOT FOUND IN THE ORIGINAL APPLICATION OR EVEN WRITTEN SUBMISSIONS FILED EARLI ER NEED NOT BE PROBED INTO ESPECIALLY WHEN IT IS NOT HIS CASE THAT THE DEVELOPER WAS NOT ALLOWED TO TAKE POSSESSION IN TE RMS OF THE AGREEMENT. 42. AFTER THE ABOVE DISCUSSION, THE AUTHORITY DISCU SSED THE FACTS OF THE CASE BEFORE IT. IT WAS OBSERVED THAT P ARAGRAPH 18 OF THE COLLABORATION AGREEMENT PROVIDES THAT ON ISSUANCE OF LETTER OF INTENT, THE OWNERS WILL ALLOW AND PERMIT THE DEVELOPER TO ENTER UPON AND SURVEY THE L AND, ERECT SITE / SALES OFFICE, CARRY OUT THE SITE DEVEL OPMENT WORK AND DO ACTIVITIES FOR ADVANCING & SALE PROMOTI ON, CONSTRUCTION ETC. THE AUTHORITY FURTHER OBSERVED T HAT IF THIS CLAUSE IS READ IN ISOLATION THIS WOULD SUGGEST ON PASSING OF POSSESSION BUT ACCORDING TO AUTHORITY TH E OTHER FACTORS ARE TO BE CONSIDERED. CLAUSE 15 PROVIDED T HAT ON FULFILLMENT OF THE REQUIREMENTS LAID DOWN IN THE LE TTER OF INTENT WHICH IS PROVISIONAL LICENSE, THE OWNERS SH OULD EXECUTE AN IRREVOCABLE GENERAL POWER OF ATTORNEY IN FAVOUR OF THE DEVELOPER ALLOWING INTER ALIA TO BOOK AND SELL THE DWELLING UNIT FAILING UNDER THEIR SHARE. THI S WAS POSSIBLE ONLY AFTER DEPOSIT OF REQUISITE CHARGES ET C. AND PERHAPS THERE WAS LITIGATION REGARDING OWNERSHIP OF LAND WHICH HAS ALSO TO BE WITHDRAWN. THE AUTHORITY HAS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 94 DISCUSSED THE SIGNIFICANCE OF GENERAL POWER OF ATTO RNEY AND THE TERMS OF THE GENERAL POWER OF ATTORNEY AT PARA 33 AND THE RELEVANT PORTION OF THE SAME IS AS UNDER:- A COPY OF THE IRREVOCABLE GPA EXECUTED IN TERMS O F PARAGRAPH 15 OF THE AGREEMENT HAS BEEN FURNISHED B Y THE APPLICANT. IT AUTHORIZES THE DEVELOPER : (I) TO ENTER UPON AND SURVEY THE LAND, PREPARE THE LAYOUT PLAN, APPLY FO R RENEWAL/EXTENSION OF LICENCE, SUBMIT THE BUILDING P LANS FOR SANCTION OF THE APPROPRIATE AUTHORITY AND TO CARRY OUT THE W ORK OF DEVELOPMENT OF A MULTI-STORIED RESIDENTIAL COMPLEX , (II) TO MANAGE AND CONTROL, LOOK AFTER AND SUPERVISE THE PROPERTY IN ANY MANNER AS THE ATTORNEY DEEMS FIT AND PROPER, (III) TO OBTAIN WATER, SEWAGE DISPOSAL AND ELECTRICITY CONNECTIONS. THE DEVELOPE R IS ALSO AUTHORIZED TO BORROW MONEY FOR MEETING THE COST OF CONSTRUCTION ON THE SECURITY AND MORTGAGE OF LAND FALLING TO THE DE VELOPERS SHARE. THE OTHER CLAUSES IN THE GPA ARE NOT RELEVANT FOR O UR PURPOSE. THE GPA UNEQUIVOCALLY GRANTS TO THE DEVELOPER A BUNDLE OF POSSESSORY RIGHTS. THE ACTS OF MANAGEMENT, CONTROL AND SUPERV ISION OF PROPERTY ARE EXPLICITLY MENTIONED. IT IS FAIRLY CLE AR THAT THE GPA IS NOT A MERE LICENCE TO ENTER THE LAND FOR DOING SOM E PRELIMINARY ACTS IN RELATION TO THE DEVELOPMENT WORK. THE POWE R OF CONTROL OF THE LAND WHICH IS AN INCIDENCE OF POSSESSION AS EXP LAINED SUPRA HAS BEEN CONFERRED ON THE DEVELOPER UNDER THIS GPA. THE DEVELOPER ARMED WITH THE GPA CANNOT BE REGARDED MER ELY AS A LICENSEE OR AN AGENT SUBJECT TO THE CONTROL OF THE OWNERS. HIS POSSESSION CANNOT BE CHARACTERIZED AS PRECARIOUS O R TENTATIVE IN NATURE. THE FACT THAT THE AGREEMENT DESCRIBES THE G PA AS IRREVOCABLE AND AN EXPRESS DECLARATION TO THAT EFFE CT IS FOUND IN THE GPA ITSELF IS NOT WITHOUT SIGNIFICANCE. HAVING REGA RD TO THE SECOND AND SUPPLEMENTAL AGREEMENT BY VIRTUE OF WHICH THE E NTIRE DEVELOPED PROPERTY INCLUDING THE OWNERS SHARE HAS BEEN AGREED TO BE SOLD TO THE DEVELOPER OR HIS NOMINEES FOR VALUA BLE MONEY CONSIDERATION, THE DEVELOPER HAS A VITAL STAKE IN THE ENTIRE PROPERTY. AS FAR AS THE QUALITY OF POSSESSION IS C ONCERNED, HE IS ON A HIGHER PEDESTAL THAN A DEVELOPER WHO APPORTIONS BUILT UP AREA WITH THE OWNER. EVEN IF HE IS AN AGENT IN ONE SENSE IN THE COURSE OF DEVELOPING THE LAND, THAT AGENCY IS COUPLED WITH IN TEREST. FOR THESE REASONS, THE PREFIX IRREVOCABLE IS DELIBERATELY C HOSEN. AS DISCUSSED EARLIER, THE OWNER'S LIMITED RIGHT TO ENT ER THE LAND AND OVERSEE THE DEVELOPMENT WORK IS NOT INCOMPATIBLE WI TH THE DEVELOPERS RIGHT OF CONTROL OVER THE LAND WHICH HE DERIVES FROM THE GPA. EXCLUSIVE POSSESSION, AS ALREADY POINTED OUT, IS NOT NECESSARY FOR THE PURPOSE OF SATISFYING THE INGREDI ENTS OF CLAUSE (V) OF SECTION 2(47). WE ARE THEREFORE, OF THE VIEW THA T THE IRREVOCABLE GPA EXECUTED BY THE OWNERS IN FAVOUR OF THE DEVELOP ER MUST BE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 95 REGARDED AS A TRANSACTION IN THE EYE OF LAW WHICH A LLOWS POSSESSION TO BE TAKEN IN PART PERFORMANCE OF THE C ONTRACT FOR TRANSFER OF THE PROPERTY IN QUESTION.. 43 THUS, THE ABOVE CLEARLY SHOWS THAT IRREVOCABLE GENERAL POWER OF ATTORNEY WHICH LEADS TO OVER ALL CONTROL OF THE PROPERTY IN THE HANDS OF THE DEVELOPER, EVEN IF THAT MEANS NO EXCLUSIVE POSSESSION BY THE DEVELOPER WOUL D CONSTITUTE TRANSFER. IT CAN BE SAID THAT IT HAS TO BE CONSTRUED AS POSSESSION IN TERMS OF CLAUSE (V) OF SECTION 2(47) OF THE ACT. 44 A QUESTION MAY ARISE THAT WHY THE TRANSFER WAS NOT HELD TO BE TAKEN PLACE IN ASSESSMENT YEAR 2006-07 WHEN FIRST AGREEME NT WAS ENTERED INTO ON JUNE 8, 2005. THE SUPPLEMENTARY AGREEMENT WAS A LSO ENTERED INTO ON SEPT 15, 2005 BOTH OF WHICH FALL IN FINANCIAL YEAR 2005-06 RELEVANT TO ASSESSMENT YEAR 2006-07. THEN WHY TRANSFER WAS NOT CONSTRUED IN ASSESSMENT YEAR 2006-07 IT WAS BECAUSE THE FIRST AG REEMENT ITSELF CONTAINED A CONDITION THAT LETTER OF INTENT SHOUL D BE PROCURED NOT LATER THAN MARCH 8, 2006. IN CASE OF FAILURE TO DO SO TH E AGREEMENT SHALL STAND TERMINATED. THEREFORE, OBTAINING THE LETTER OF I NTENT WAS THE CRUCIAL FACTOR. IT HAS BEEN EXPLAINED IN THE DECISION THAT THE LETTER OF INTENT BASICALLY IS A LICENSE ISSUED BY THE DIRECTOR OF TO WN AND COUNTRY PLANNING, HARYANA WHICH GIVES PERMISSION FOR CONSTR UCTION OF THE FLATS. THE OTHER CRUCIAL POINT WAS EXECUTION OF IRREVOCABL E OF GPA WHICH WAS EXECUTED ON MAY 8, 2006 WHICH ACCORDING TO THE LD. AUTHORITY DEPICTS THE INTENTION OF THE HANDING OVER OF THE POSSESSION. T HEREFORE, IT BECOMES VERY CLEAR THAT IT IS NOT NECESSARY THAT TRANSFER W OULD TAKE PLACE ON THE SIGNING OF DEVELOPMENT AGREEMENT BUT THE SAME HAS T O BE INFERRED ONLY WHEN THE POSSESSION HAS BEEN HANDED OVER BY THE TRA NSFEROR TO THE DEVELOPER WHICH CAN BE INFERRED FROM THE DOCUMENTS E.G. POWER OF ATTORNEY. AFTER ABOVE DISCUSSION HON'BLE AUTHORITY HAS SUMMARIZED THE DECISION IN PARA 41 WHICH IS AS UNDER: THE FOLLOWING IS THE SUMMARY OF CONCLUSIONS: ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 96 1. WHERE THE AGREEMENT FOR TRANSFER OF IMMOVABLE PR OPERTY BY ITSELF DOES NOT PROVIDE FOR IMMEDIATE TRANSFER OF POSSESSION, T HE DATE OF ENTERING INTO THE AGREEMENT CANNOT BE CONSIDERED TO BE THE D ATE OF TRANSFER WITHIN THE MEANING OF CLAUSE (V) OF SECTION 2 (47) OF THE INCOME-TAX ACT. 2. TO ATTRACT CLAUSE (V) OF SECTION 2(47), IT IS NO T NECESSARY THAT THE ENTIRE SALE CONSIDERATION UP TO THE LAST INSTALLMENT SHOUL D BE RECEIVED BY THE OWNER. 3. IN THE INSTANT CASE, HAVING REGARD TO THE TERMS OF THE TWO AGREEMENTS AND THE IRREVOCABLE GPA EXECUTED PURSUANT TO THE AG REEMENT, THE EXECUTION OF THE GPA SHALL BE REGARDED AS THE TRAN SACTION INVOLVING THE ALLOWING OF THE POSSESSION OF LAND TO BE TAKEN IN PART PERFORMANCE OF THE CONTRACT AND THEREFORE, THE TRANSFER WITHIN THE MEANING OF SECTION 2(47)(V) MUST BE DEEMED TO HAVE TAKEN PLACE ON THE DATE OF EXECUTION OF SUCH GPA. THE IRREVOCABLE GPA WAS EXECUTED ON MA Y 8, 2006, I.E., DURING THE PREVIOUS YEAR RELEVANT TO THE ASSESSMENT YEAR 2007-08 AND THE CAPITAL GAINS MUST BE HELD TO HAVE ARISEN DURIN G THAT YEAR. INCIDENTALLY, IT MAY BE MENTIONED THAT DURING THE S AID YEAR, I.E., FINANCIAL YEAR 2006-07, A FINAL LICENSE WAS GRANTED AND THE APPLICANT/OWNERS RECEIVED NEARLY 2/3RDS OF THE CONS IDERATION. 45. LEGAL POSITION HAS BEEN DISCUSSED IN ABOVE NOT ED PARAS AND NOW LET US DISCUSS THE FACTS OF THE CASE IN THE LIGHT OF ABOVE NOTED LEGAL POSITION. 46 UNDISPUTED FACTS OF THE CASE ARE THAT THE ASSES SEE IS A MEMBER OF PUNJABI COOP HOUSE BUILDING SOCIETY LTD. WHICH HAD 96 MEMBERS (NUMBER OF MEMBERS WERE STATED AS 95 DURING ARGUMENTS BUT CLAUSE 13 OF THE JDA REF ERS TO NUMBER OF MEMBERS AS 96). THE SOCIETY WAS OWNING 21 .2 ACRES OF LAND IN VILLAGE KANSAL DISTT. MOHALI ADJAC ENT TO CHANDIGARH. THERE WERE TWO TYPES OF MEMBERS FIRSTL Y THE MEMBERS WHO WERE OWNING PLOT OF 500 SQYD AND SECOND LY THE MEMBERS WHO ARE HOLDING PLOT OF 1000 SQYD. SOMEWHERE IN 2006 IT WAS DECIDED TO DEVELOP A GROUP HOUSING COMMERCIAL PROJECT AND DO DEVELOPMENT AS PE R THE APPLICABLE MUNICIPAL BUILDING BYE-LAWS IN FORCE AND ACCORDINGLY A BID WAS INVITED THROUGH ADVERTISEMEN T IN THE TRIBUNE DATED 31.5.2006. HASH A DEVELOPER, APPROACHED THE SOCIETY WITH PROPOSAL FOR DEVELOPMEN T OF THE PROPERTY. SINCE HASH DID NOT HAVE SUFFICIENT M EANS TO DEVELOP THE PROPERTY, HASH HAD APPROACHED THDC FOR DEVELOPMENT OF THE PROPERTY BY CONSTRUCTING THE BUI LDING AND/OR STRUCTURES TO BE USED FOR INTERALIA RESIDENT IAL, PUBLIC USE AND COMMERCIAL PURPOSES. THIS PROPOSAL WAS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 97 DISCUSSED BY THE SOCIETY IN ITS EXECUTIVE COMMITTEE MEETING ON 4.1.2007. MINUTES OF THE MEETING ARE PL ACED AT PAGE 58 TO 65 OF THE PAPER BOOK. IN THE EXECUTI VE COMMITTEE IT WAS DECIDED TO APPOINT HASH WHO WAS AC TING ALONGWITH THE JOINT DEVELOPER THDC AS JOINT DEVELO PER ON THE TERMS AND CONDITIONS TO BE MENTIONED IN THE JDA . IT WAS FURTHER RESOLVED THAT MEMBER OWING PLOT OF 500 SQYD WOULD RECEIVE A CONSIDERATION OF RS. 82,50,000/- EA CH TO BE PAID IN FOUR INSTALLMENTS BY HASH DIRECTLY IN FA VOUR OF THE MEMBERS AND ONE FLAT WITH SUPER AREA OF 2250 SQ F TO BE CONSTRUCTED BY THDC. THE MEMBERS WHO HELD THE P LOT OF 1000SQYD WERE TO RECEIVE A CONSIDERATION OF RS. 1,65,00,000/- AND TWO FLATS CONSISTING OF 2250SQFT TO BE CONSTRUCTED BY THE THDC. IT WAS FURTHER RESOLVED TO ENTER INTO A JDA WITH THDC/HASH. IT WAS ALSO RESOL VED TO EXECUTE IRREVOCABLE POWER OF ATTORNEY BY THE SOC IETY IN FAVOUR OF THDC FOR THIS PURPOSE. THIS RESOLUTION WA S ULTIMATELY RATIFIED IN THE GENERAL BODY MEETING HEL D BY THE SOCIETY ON 25.2.2007. PURSUANT TO THE ABOVE RESOLUTION, TRIPARTITE JDA WAS EXECUTED (COPY OF T HE SAME IS AVAILABLE AT PAGE 15 TO 54 OF FIRST PAPER BOOK). THROUGH RECITATION CLAUSE IT HAS BEEN MENTIONED THA T OWNER IS IN POSSESSION OF LAND MEASURING ABOUT 21.2 ACRES OF LAND WHICH HAS COME IN THE PURVIEW OF NAGA R PANCHAYAT, NAYA GAON VIDE NOTIFICATION ISSUED ON 18.10.2006 DULY SUBSTITUTED BY ANOTHER NOTIFICATION DATED 21.11.2006 AND THAT NO PART OF LAND OF THE PROPERTY FALLS UNDER FOREST AREA UNDER THE PUNJAB LAND PRESERVATIO N ACT. IT HAS BEEN FURTHER RECITED THAT THE SOCIETY HAS AGREED TO ACCEPT THE PROPOSALS OF HASH AND FURTHER EXECUTED THIS AGREEMENT WITH THDC/HASH. HASH WAS RESPONSIBLE TO MAKE PAYMENT TO THE OWNER AS DESCRIB ED EARLIER AND THE FLATS WERE TO BE PROVIDED BY THDC. IN CASE OF HASH FAILS TO MAKE THE PAYMENT, THDC AGREED TO MAKE THE PAYMENTS. COPY OF THE RESOLUTION OF THE EXECUTIVE COMMITTEE OF THE SOCIETY DATED 4.1.2007 A S WELL AS RESOLUTION OF THE GENERAL BODY MEETING OF T HE SOCIETY DATED 25.2.2007 WERE MADE PART OF JDA BY WA Y OF ANNEXURE. THE SOCIETY AGREED TO EXECUTE AN IRREVOC ABLE SPECIAL POWER OF ATTORNEY IN FAVOUR OF THDC AND AL L OTHER NECESSARY DOCUMENTS, AT THE REQUEST OF THE DEVELOPERS. 47 IN CLAUSE 1 OF JDA VARIOUS EXPRESSIONS HAVE BEE N DEFINED. CLAUSE 2 DESCRIBES THE PROJECT AS UNDER: ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 98 2.1 THE OWNER HEREBY IRREVOCABLY AND UNEQUIVOCALLY GRANTS AND ASSIGNS IN PERPETUITY ALL ITS RIGHTS TO DEVELOP, CONSTRUCT, MORTGAGE, LEASE, LICENSE, SELL AND TRANSFER THE PROPERTY ALONG WITH ANY AND ALL THE CONSTRUCTION, PREMISES, HEREDITAMENTS, EASEMENTS, TREES THEREON IN FAVOUR OF THDC FOR THE PURPOSE OF DEVELOPMENT, CONSTRUCTION, MORTGAGE, SALE, TRANSFER , LEASE, LICENSE AND OR EXPLOITATION FOR FULL UTILIZA TION OF THE PROPERTY (RIGHTS) AND TO EXECUTE ALL THE DOCUMENTS NECESSARY TO CARRY OUT, FACILITATE AND ENFORCE THE RIGHTS IN THE PROPERTY INCLUDING TO EXECUTE LEASE AGREEMENT, LICENSE AGREEMENTS, CONSTRUCTION CONTRACTS, SUPPLIE R CONTRACTS, AGREEMENT FOR SALE, CONVEYANCE, MORTGAGE DEEDS, FINANCE DOCUMENTS AND ALL DOCUMENTS AND AGREEMENTS NECESSARY TO CREATE AND REGISTER THE MORTGAGE, CONVEYANCE, LEASE DEEDS, LICENSE AGREEMEN T, POWER OF ATTORNEY, AFFIDAVITS, DECLARATION, INDEMNI TIES AND ALL SUCH OTHER DOCUMENTS, LETTERS AS MAY BE NECESSA RY TO CARRY OUT, FACILITATE AND ENFORCE THE RIGHTS AND TO REGISTER THE SAME WITH THE REVENUE/COMPETENT AUTHORITY AND T O APPEAR ON OUR BEHALF BEFORE ALL AUTHORITIES, STATUT ORY OR OTHERWISE, AND BEFORE ANY COURT OF LAW (THE DEVELO PMENT RIGHTS). THE OWNER HEREBY HANDS OVER THE ORIGINAL TITLE DEEDS OF THE PROPERTY AS MENTIONED IN THE LIS T ANNEXED HERETO AND MARKED AS ANNEXURE IV AND PHYSICAL, VACANT POSSESSION OF THE PROPERTY HAS BEE N HANDED OVER TO THDC SIMULTANEOUS TO THE EXECUTION AND REGISTRATION OF THIS AGREEMENT TO DEVELOP THE S AME AS SET OUT HEREIN. IT IS HEREBY AGREED AND CONFIRMED THAT WHAT IS STAT ED IN THE RECITALS HEREINABOVE, SHALL BE DEEMED TO BE DECLARATIONS AND REPRESENTATIONS ON THE PART OF THE OWNER AS IF THE SAME WERE SET OUT HEREIN VERBATIM AND FOR MING AN INTEGRAL PART OF THE AGREEMENT. 2.2 THE PROJECT SHALL COMPRISE OF DEVELOPMENT/CONSTRUCTION OF THE PROPERTY INTO THE PREMISES AS PERMISSIBLE UNDER PUNJAB MUNICIPAL BUIL DING BYE-LAWS/PUNJAB URBAN DEVELOPMENT AUTHORITY OR ANY OTHER COMPETENT AUTHORITY BY THE DEVELOPER AT THEIR OWN COST AND EXPENSE. THE PROJECT SHALL BE DEVELOPED A S MAY BE SANCTIONED BY THE CONCERNED LOCAL AUTHORITY I.E. DEPARTMENT OF LOCAL BODIES, PUNJAB/PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (PUDA) OR ANY OT HER COMPETENT AUTHORITY. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 99 2.3 THE OWNER HEREBY IRREVOCABLY AND UNEQUIVOCALLY GRANTS AND ASSIGNS ALL ITS DEVELOPMENT RIGHTS IN TH E PROPERTY TO THDC TO DEVELOP THE PROPERTY AND UNDERT AKE THE PROJECT AT ITS OWN COSTS, EFFORTS AND EXPENSES WHEREUPON THE DEVELOPER SHALL BE ENTITLED TO APPLY FOR AND OBTAIN NECESSARY SANCTIONS, LICENSES AND PERMIS SIONS FROM ALL THE CONCERNED AUTHORITIES FOR THE COMMENCE MENT, DEVELOPMENT AND COMPLETION OF THE PROJECT ON THE PROPERTY. 48 CLAUSE 3 DESCRIBES THE OBLIGATIONS OF THE DEVELO PERS & SOCIETY FOR GETTING THE PLANS, ETC. SANCTIONED FR OM COMPETENT AUTHORITY / APPLICATIONS TO BE SIGNED BY OWNER FOR PLANS, DRAWINGS ETC., CONSTRUCTION. CLAUSE 4 D EALS WITH CONSIDERATION CLAUSES 5 TO 8 DEALS VARIOUS AS PECTS OF PROJECT AND OBLIGATIONS OF SOCIETY AND DEVELOPER . CLAUSE 9 TALKS ABOUT OWNERSHIP AND RIGHTS AND READ AS UNDER: 9 TRANSFER OF OWNERSHIP/RIGHTS 9.1 THE OWNER SHALL SIMULTANEOUSLY ON RECEIPT OF PAYMENT AS SET OUT IN CLAUSE 4.1 ABOVE, EXECUTE AN IRREVOCABLE SPECIAL POWER OF ATTORNEY TO THDC FOR DEVELOPMENT OF THE PROPERTY AUTHORIZING THDC TO DO ALL LAWFUL ACTS, DEEDS, MATTERS AND THINGS PERTAINI NG TO THE DEVELOPMENT OF THE PROPERTY FOR THE PROJECT ALO NG WITH INTERALIA RIGHT TO MORTGAGE THE PROPERTY AND/O R PREMISES, SELL, LEASE, LICENSE THE PREMISES AND RECEIVE/COLLECT MONIES IN ITS NAME IN RESPECT OF THE SAME AND APPROACH INTERACT, COMMUNICATE WITH THE COMPETENT AUTHORITIES AND FOR DOING ALL ACTS, DEEDS , MATTERS AND THINGS TO BE DONE OR INCURRED BY THDC I N THAT BEHALF AS ALSO TO SIGN ALL LETTERS, APPLICATIONS, A GREEMENTS AND REGISTER THE SAME IF NECESSARY, DOCUMENTS, COUR T PROCEEDINGS, AFFIDAVITS AND SUCH OTHER PAPERS CONT AINING TRUE FACTS AND CORRECT PARTICULARS AS MADE FROM TIM E TO TIME BE REQUIRED IN THIS BEHALF. 9.2 THE OWNER SHALL EXECUTE IN FAVOUR OF THDC THE SALE DEED IS IN ACCORDANCE WITH THE PROVISIONS OF CLAUSE 4.1(II) TO CLAUSE 4.1(IV) OF THIS AGREEMENT AND EXECUTE ALL OTHER NECESSARY DOCUMENTS AND PAPERS TO COMPLETE THE AFORESAID TRANSACTION. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 100 9.3 THAT ALL THE ORIGINAL TITLE DEEDS PERTAINING T O PROPERTY AS MENTIONED IN ANNEXURE IV HAS BEEN HANDED OVER TO THDC BY THE OWNER AT THE TIME OF SIGNING OF THIS AGREEMENT AND IN FURTHERANCE OF THE COMMON INTEREST OF THE PARTIES FOR THE DEVELOPMENT OF THE PROJECT AND EXCEPT THE SALE TRANSACTION MADE BY THE OWNER IN FAVOUR OF THDC AS ET OUT IN CLAUSE 4.1 ABOVE. THDC HEREBY UNDERTAKE AND ASSURE THE OWNER THAT THE Y SHALL USE THE TITLE DEEDS ONLY FOR THE PURPOSE OF FURTHERANCE OF THE PROJECT IN THE MANNER THAT IT DO ES NOT ADVERSELY EFFECT THE OWNER/ALLOTTEE IN ANY MANNER WHATSOEVER. 49 CLAUSE 10 DESCRIBES THE CONSENT GIVEN BY THE SOCIETY TO THDC FOR RAISING FINANCE FOR DEVELOPMENT AND COMPLETION OF PROJECT. CLAUSE 11 TALKS ABOUT FORMA TION OF MAINTENANCE SOCIETY FOR THE PROJECT AFTER ITS COMPL ETION. CLAUSE 13 TALKS ABOUT TRANSFER OF RIGHTS WHICH READ S AS UNDER: 13 TRANSFER OF RIGHTS THE OWNER HEREIN I.E. THE PUNJABI COOP HOUSE BUILDI NG SOCIETY LTD. ALONG WITH ALL ITS NINETY SIX (96) MEM BERS HAVE GIVEN THEIR EXPRESS, FREE AND CLEAR CONSENT IN WRITING IN THE FORM OF AN AFFIDAVIT/NO OBJECTION CERTIFICATE/CONSENT LETTER WHEREBY THE DEVELOPERS H AVE BEEN ALLOWED TO DEVELOP THE PROPERTY IN ACCORDANCE WITH THE PROJECT AND THAT THDC SHALL BE ENTITLED TO TRAN SFER THE RIGHTS OBTAINED UNDER THIS AGREEMENT TO ANY THIRD P ARTY AND TO GET THE DEVELOPMENT / CONSTRUCTION WORK COMP LETED ON SUCH TERMS AND CONDITIONS AS THDC MAY DEEM FIT S O LONG AS IT DOES NOT ADVERSELY EFFECT THE OWNER IN T ERMS OF THEIR RIGHT TO RECEIVE ENTIRE CONSIDERATION AS MENT IONED IN THIS AGREEMENT SUBJECT TO ALL OTHER CONDITIONS MENT IONED THEREIN AS WELL. THE OWNER SHALL AT ALL TIMES PROV IDE FULL SUPPORT TO THE DEVELOPERS HEREIN. 50 OTHER CLAUSES PROVIDE FOR TERMINATION, GENERAL PROVISIONS, DISCLAIMER, PARTIAL INVALIDITY, ARBITRA TION, NOTICES AND FORCE MAJEURE & JURISDICTION. 51 IN ADDITION TO ABOVE AN IRREVOCABLE SPECIAL POWE R OF ATTORNEY HAS ALSO BEEN EXECUTED BY THE SOCIETY IN F AVOUR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 101 OF THE DEVELOPERS I.E. THDC. (COPY OF WHICH IS AVA ILABLE AT PAGES 40 TO 52 OF THE PAPER BOOK IN CASE OF SOCI ETY IN ITA NO. 556 OF 2012 AS DISCUSSED EARLIER IN PARA 25 (COMPLETE COPY OF SUPPLEMENTARY POWER OF ATTORNEY W AS NOT AVAILABLE IN THE PAPER BOOK OF THE ASSESSEE, THEREFORE, REFERENCE WAS MADE TO THE PAPER BOOK IN CASE OF THE SOCIETY). 52 THE FIRST MAJOR CONTENTION OF THE LD. COUNSEL OF THE ASSESSEE IS THAT THE POSSESSION WAS NOT GIVEN BY TH E SOCIETY BECAUSE ACCORDING TO HIM AS PER CLAUSE 2.1 OF THE JDA THE POSSESSION OF THE PROPERTY WAS TO BE HANDED OVER SIMULTANEOUSLY TO THE EXECUTION AND REGISTRATION OF JDA AND SINCE THE JDA WAS NOT REGISTERED, THEREFORE, T HE POSSESSION WAS NOT GIVEN. WE CAN NOT ACCEPT THIS CONTENTION BECAUSE IN POWER OF ATTORNEY TRANSACTI ONS, IT IS NOT NECESSARY TO REGISTER THE JDA IF A SPECIAL P OWER OF ATTORNEY HAS BEEN GIVEN AND SAME IS REGISTERED. SECONDLY CLAUSE 9.3 OF THE JDA AS REPRODUCED ABOVE CLEARLY SHOW THAT ORIGINAL TITLE DEED WHICH HAVE BE EN MENTIONED ALONG WITH THE POSSESSION IN PARA 2.1 WHI CH ACCORDING TO THE LD. COUNSEL OF THE ASSESSEE WERE T O BE HANDED OVER SIMULTANEOUSLY TO EXECUTION AND REGISTR ATION OF THE JDA, IS NOT CORRECT BECAUSE CLAUSE 9.3 CLEAR LY MENTION THAT ORIGINAL TITLE DEED OF THE PROPERTY HA VE BEEN HANDED OVER TO THE THDC AT THE TIME OF SIGNING OF T HIS AGREEMENT BECAUSE CLAUSE 9.3 THERE IS NO MENTION AB OUT REGISTRATION OF JDA. 53 SPECIAL POWER OF ATTORNEY WHICH HAS BEEN EXECUTE D ON 26.2.2007 AND HAS BEEN REGISTERED ALSO. THE IRREVOCABLE SPECIAL POWER OF ATTORNEY HAS BEEN EXEC UTED AS PROVIDED IN CLAUSE 6.7 OF THE JDA WHICH READS AS UNDER: 6.7 THE OWNER SHALL EXECUTE AN IRREVOCABLE SPECIAL POWER OF ATTORNEY GRANTING ITS COMPLETE DEVELOPMENT RIGHTS IN THE PROPERTY IN FAVOUR OF THDC INTERALIA INCLUDING THE RIGHT TO RAISE FINANCE BY MORTGAGING THE PROPERTY AND REGISTER THE CHARGE WITH THE COMPETENT AUTHORITY AND EXECUTE REGISTERED SALE DEEDS) AS SET OUT IN CLAUSE 4.1 (II), (III), (IV) AND (V) AND THE OWNER CONFIRMS, UNDERTAKES, DECLARES AND BINDS ITSELF NOT TO REVOKE THE SAME FOR ANY REASON WHATSOEVER OUT OF IT S OWN WILL AND DISCRETION WITHOUT OBTAINING A SPECIFI C ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 102 PRIOR WRITTEN CONSENT OF THDC OR ANY OF ITS DULY CONSTITUTED ATTORNEYS. THROUGH THIS POWER OF ATTORNEY VARIOUS POWERS HAVE BEEN GIVEN LIKE TO ASSIGN, FILE, AMEND ETC. VARIOUS PLA NS, DESIGNS TO REPRESENT BEFORE VARIOUS AUTHORITIES, T O APPOINT ARCHITECT, LAWYERS. SOME OF THE SPECIFIC CLAUSES RELEVANT, ARE EXTRACTED BELOW: (J) TO NEGOTIATE AND AGREE TO ANY/OR TO ENTER INTO AGREEMENT(S) TO CONSTRUCT/SELL AND TO UNDERTAKE CONSTRUCTION/SALE OF THE PREMISES ON THE PROPERTY O R ANY PORTION THEREOF WITH/TO SUCH PERSONS(S) OR BODY AND FOR SUCH CONSIDERATION AND UPON SUCH TERMS AND CONDITIO NS AS THE ATTORNEY DEEM FIT. (N) TO ENTER UPON THE PROPERTY EITHER ALONE OR WITH OTHERS FOR THE PURPOSE OF DEVELOPMENT, COORDINATION , EXECUTION, IMPLEMENTATION OF THE PROJECT AND COMMERCIALIZATION OF THE PROPERTY/PREMISES. (T) TO AMALGAMATE THE PROPERTY WITH ANY OTHER CONTIGUOUS, ADJACENT AND ADJOINING LAND SAND PROPER TIES WHEREIN DEVELOPMENT AND/OR OTHER RIGHT, BENEFITS AN D INTERESTS ARE ACQUIRED AND/OR PROPOSED TO BE ACQUIR ED AND DEVELOPED OR PROPOSED TO BE DEVELOPED BY THDC AND/O R THEIR ASSOCIATE AND/OR GROUP CONCERNS/S AND/OR UTIL IZE THE FSI, FAR, DR AND TDR OF THE CONTIGUOUS, ADJACENT AN D ADJOINING LANDS FOR THE PURPOSE OF CONSTRUCTING BUI LDINGS AND/OR STRUCTURES THEREON AND/OR ON THE PROPERTY O R UTILIZE SUCH LANDS AND PROPERTIES FOR MAKING PROVIS ION OF PARKING SPACES THEREON, AND/OR MAY UTILIZE THE SAME FOR ANY OTHER LAWFUL PURPOSE, AS THDC AND/OR THEIR ASSO CIATE AND/OR GROUP CONCERNS MAY IN THEIR SOLD, ABSOLUTE A ND UNFETTERED DISCRETION THINK FIT. (W) TO HAND OVER THE POSSESSION OF THE PROPERTY OR ANY PART OR PORTION THEREOF TO THE AUTHORITIES TO WHOM THE SAME IS REQUIRED TO BE HANDED OVER OR OTHERWISE AND TO EXECUTE AND DELIVER ANY UNDERTAKINGS, DECLARATIONS, AFFIDAVITS, BONDS, DEEDS, DOCUMENTS, ETC. AS MAY BE REQUIRED BY THE AUTHORITIES CONCERNED FOR VESTING S UCH A PART OR PORTION IN SUCH AUTHORITY AND TO ADMIT EXEC UTION THEREOF BEFORE THE CONCERNED COMPETENT AUTHORITY AN D GET THE SAME REGISTERED WITH THE CONCERNED SUB-REGISTRA R. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 103 (Y) REASONABLE OPPORTUNITY OF HEARING SHALL BE GIVE N TO MORTGAGE, ENCUMBER OR CREATE A CHARGE ON THE PROPER TY OR ANY PART OR PORTION THEREOF AND EXECUTE THE NECESSA RY SECURITY DOCUMENTS IN FAVOUR OF ANY BANK/FINANCIAL INSTITUTION TO RAISE FUNDS FOR THE CONSTRUCTION/DEV ELOPMENT OF THE PROPERTY AND FOR THE SAID PURPOSE TO DEPOSIT TITLE DEEDS (IF REQUIRED) IN RESPECT OF THE PROPERTY IN F AVOUR OF SUCH BANK/FINANCIAL INSTITUTION, EXECUTE THE NECESS ARY DOCUMENTS AND REGISTER THE CHARGE CREATED ON THE PROPERTY IF SO REQUIRED IN THE REVENUE RECORDS AND/ OR DESIRED BY THE ATTORNEY. (AA) TO SELL, TRANSFER, LEASE, LICENSE THE PREMISE S THAT MAY BE CONSTRUCTED ON THE PROPERTY ON OWNERSHIP BAS IS, LEASE, LICENSE AND/OR IN ANY OTHER MANNER FOR SUCH PRICE AS THE ATTORNEYS MAY DEEM FIT AND PROPER. TO COLLE CT AND RECEIVE FROM THE PURCHASED, TRANSFEREES, LESSEES, LICENSEES OF THE PREMISES, MONIES/PRICE AND/OR CONSIDERATION AND/OR MAINTENANCE CHARGES AND TO SIG N AND EXECUTE AND/OR GIVE PROPER AND LAWFUL DISCHARGE FOR THE RECEIPTS. (BB) TO EXECUTE FROM TIME TO TIME ALL THE WRITING, AGREEMENT, DEEDS ETC. IN RESPECT OF THE PREMISES WH ICH MAYBE CONSTRUCTED ON THE PROPERTY AND ALSO TO EXECU TE AND SIGN CONVEYANCE, TRANSFER OR SURRENDER IN RESPE CT OF THE PROPERTY OR ANY PART THEREOF. (CC) TO SIGN, EXECUTE AND REGISTER THE CONVEYANCES OR ASSIGNMENTS AND/OR POWER OF ATTORNEYS AND/OR OTHER DOCUMENTS AND/OR AGREEMENTS AND/OR ANY OTHER WRITIN GS IN RESPECT OF THE PROPERTY IN PART OR FULL AND/OR THE PREMISES CONSTRUCTED THEREON OR ANY PART THEREOF IN FAVOUR O F ANY PERSON AS THE ATTORNEYS MAY DETERMINE INCLUDING IN FAVOUR OF ANY INDIVIDUAL AND/OR LEGAL ENTITLES AND/OR CO- OPERATIVE SOCIETY AND/OR LIMITED COMPANY AND/OR ANY OTHER ENTITY THAT MAY BE FORMED FOR SUCH PURPOSE. (DD) TO ISSUE LETTER OF LIEN/NOCS AND TO SIGN DOCU MENTS ON BEHALF OF THE OWNER AS REQUIRED BY THE PROSPECTI VE BUYERS/LENDING INSTRUCTIONS TO CREATE A CHARGE ON T HE ALLOTTED PREMISES. (GG) TO LOOK AFTER AND MAINTAIN THE PROPERTY AND TH E PREMISES CONSTRUCTED THEREON TILL ITS TRANSFER IN F AVOUR OF ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 104 THE CO-OPERATIVE SOCIETY OR LIMITED COMPANY OR ANY OTHER ORGANISATION. 54 IT IS PERTINENT TO NOTE THAT POWER/AUTHORIZATIO N WHICH HAVE BEEN GIVEN BY THE SOCIETY TO THE DEVELOPER, WERE IN FACT WERE REQUIRED TO BE GIVEN IN TERMS OF VARIOUS CLAUSES OF THE JDA. CLAU SE 6.7 REPRODUCED ABOVE ITSELF SHOWS THAT THE SOCIETY WAS REQUIRED TO GIVE POWERS TO RAISE FINANCE TO MORTGAGE THE PROPERTY AND EVEN THE REGIS TRATION OF CHARGE WAS ALSO REQUIRED TO BE GIVEN. FURTHER THROUGH CLAUSE 6.15 IT WAS AGREED THAT DOCUMENTS OF ORIGINAL TITLE DEEDS OF THE PROPERTY W OULD BE HANDED OVER TO THE DEVELOPER I.E. THDC/HASH SO THAT SAME CAN BE US ED IN FURTHERANCE OF DEVELOPMENT OF THE PROJECT AS WELL AS SECURITY F OR THE MONEY PAID BY THE OWNER. THROUGH CLAUSE 6.24 IT WAS AGREED THAT DEVE LOPER THDC/HASH WAS ALWAYS PERMITTED BY OWNER TO AMALGAMATE THE PRO PERTY WITH ANY OTHER CONTIGUOUS, ADJACENT AND ADJOINING LAND AND THE PRO PERTIES WHEREIN DEVELOPMENTAL AND OR OTHER RIGHTS, BENEFITS AND IN TEREST WERE ACQUIRED BY THE DEVELOPER OR WOULD BE ACQUIRED IN FUTURE. THIS CLEARLY SHOWS THAT THE SOCIETY WAS UNDER OBLIGATION IN TERMS OF AGREEMENT ITSELF TO ALLOW THE DEVELOPER TO AMALGAMATE THE PROJECT. TOWARDS THE E ND OF CLAUSE 6.24 IT HAS BEEN CLEARLY STATED THAT IN THE EVENT OF TERMIN ATION OF JDA, PROVISION OF CLAUSE 6 WOULD BE SURVIVING WHICH CLEARLY SHOWS THA T DEVELOPER CONTINUES TO BE IN POSSESSION FOR THE PURPOSE OF DEVELOPMENT, MORTGAGE ETC. EVEN AFTER TERMINATION. CLAUSE 8 WHICH DESCRIBES THE OB LIGATION AND UNDERTAKING OF THE THDC/HASH AND PROVIDES SPECIFICA LLY THAT ALL ENVIRONMENTAL CLEARANCE SHALL BE OBTAINED BY THDC/H ASH OUT OF ITS OWN SOURCES. THUS IT WAS CLEARLY UNDERSTOOD BY THE PAR TIES THAT REQUISITE ENVIRONMENTAL CLEARANCES HAD TO BE OBTAINED BEFORE START OF THE PROJECT. CLAUSE 10 AGAIN CASTS SPECIFIC OBLIGATION ON THE OW NER SOCIETY TO GIVE CONSENT TO THDC/HASH TO RAISE FINANCE FOR THE DEVEL OPMENT AND COMPLETION OF THE PROJECT ON THE SECURITY OF THE PR OPERTY BY WAY OF MORTGAGING THE PROPERTY. THUS WHATEVER POWER/AUTHO RIZATION HAVE BEEN GIVEN THROUGH IRREVOCABLE SPECIAL POWER OF ATTORNEY ARE EMANATING FROM THE TERMS AND CONDITIONS AGREED TO AMONG THE PARTIE S FROM THE JDA. 55 THE COMBINED READING OF THE ABOVE CLAUSES OF TH E IRREVOCABLE SPECIAL POWER OF ATTORNEY AND JDA CLEAR LY SHOW THAT THE DEVELOPER WAS AUTHORIZED TO ENTER UPO N THE PROPERTY FOR NOT ONLY FOR THE PURPOSE OF DEVELOPMEN T BUT OTHER PURPOSES ALSO. THDC WAS AUTHORIZED TO AMALGAMATE THE PROJECT WITH ANY OTHER PROJECT IN TH E ADJACENT AREA OR ADJOINING AREA AS PER CLAUSE (T) O F THE SPECIAL POWER OF ATTORNEY. IF THE POSSESSION WAS N EVER GIVEN TO THE DEVELOPER BY THE SOCIETY THEN HOW THE DEVELOPER COULD AMALGAMATE THE PROJECT WITH ANOTHE R PROJECT WHICH MAY BE ACQUIRED LATTER IN THE ADJOINI NG AREA. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 105 THROUGH CLAUSE (W) THDC WAS AUTHORIZED TO HAND OVER THE POSSESSION OF PROPERTY OR PORTION THEREOF TO THE AU THORITY TO WHOM THE SAME IS REQUIRED. IN LARGE HOUSING SOC IETY PROJECTS SOMETIMES MUNICIPAL AUTHORITIES TAKES SOME PORTION OF LAND FOR THE PURPOSE OF ROADS, PARKS OR OTHER GENERAL UTILITY PURPOSES LIKE INSTALLATION OF ELECT RICITY TRANSFORMERS AND BEFORE SANCTIONING THE PLANS THE DEVELOPER IS REQUIRED TO UNDERTAKE THAT SUCH PORTIO NS OF LAND WOULD BE GIVEN FOR SUCH A COMMON PURPOSE. IF POSSESSION WAS NOT GIVEN THEN HOW THDC WAS AUTHORIZ ED TO HAND OVER SUCH LAND OR PORTIONS THEREOF WHICH HA VE NOT BEEN IDENTIFIED IN THE JDA OUT OF THE TOTAL LAND. SIMILARLY THROUGH CLAUSE (Y) THDC HAS BEEN AUTHORIZED TO MORTGAGE, ENCUMBRANCE OR CREATE CHARGE ON THE PROPE RTY IN FAVOUR OF ANY BANK OR FINANCIAL INSTITUTION FOR RAISING THE FUNDS FOR THE PROJECT. IN THE ABSENCE OF POSSE SSION SUCH POWERS CANNOT BE GIVEN. CLAUSE (AA) CLEARLY AUTHORIZED THE THDC TO SELL, TRANSFER, LEASE, LICEN SE THE PREMISES WHICH WERE TO BE CONSTRUCTED ON OWNERSHIP BASIS AND FURTHER TO RECEIVE MONEYS AGAINST SUCH SA LE ETC. AND TO ISSUE FINAL RECEIPT. NOWHERE IT IS MENTIONE D IN THIS CLAUSE THAT SUCH SALE DEEDS WERE TO BE SINGED BY TH E SOCIETY AS CONFIRMING PARTY. IN THE ABSENCE OF POSSESSION IT IS JUST NOT POSSIBLE FOR THE DEVELOPE R TO SELL AND TRANSFER THE PREMISES WHICH WERE TO BE CONSTRUC TED. THIS IS FURTHER CLARIFIED BY CLAUSE (BB) AND (CC) W HICH GIVES THE POWER OF EXECUTION OF CONVEYANCE AND OTHE R DOCUMENTS INVOLVING IN RESPECT OF THE PREMISES TO B E CONSTRUCTED WITHOUT ANY INTERFERENCE OF THE SOCIETY BEING MADE CONFIRMING PARTY. ALL THESE CLAUSES CLEARLY S HOW THAT THE POSSESSION WAS GIVEN BY THE SOCIETY AND/OR ITS MEMBERS TO THDC/HASH ON THE EXECUTION OF IRREVOCABL E POWER OF ATTORNEY. THROUGH THESE CLAUSES OF JDA AN D IRREVOCABLE POWER OF ATTORNEY THE DEVELOPER WAS AB LE TO COMPLETELY CONTROL THE PROPERTY AND MAKE USE OF IT NOT ONLY FOR THE PURPOSE OF DEVELOPMENT BUT ALSO FOR TH E PURPOSE OF AMALGAMATION, SALE, MORTGAGE ETC. WHEN T HE ABOVE CLAUSES ARE COMPARED ON TOUCH STONE OF THE DISCUSSION ON POSSESSION IN PARA 26 TO 28 IN THE CA SE OF JASBIR SINGH SARKARIA (SUPRA) WHICH WE HAVE REPRODU CED ABOVE, IT BECOMES CLEAR THAT THE POSSESSION HAS BEE N GIVEN. 56 IN THAT DISCUSSION, IT HAS BEEN CLEARLY MENTION ED THAT THE POSITION CONTEMPLATED BY CLAUSE (V) OF SECTION 2(47) OF THE ACT NEED NOT TO BE EXCLUSIVE POSSESSION. WHAT IS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 106 REQUIRED IS THAT THE TRANSFEREE BY VIRTUE OF POSSES SION SHOULD BE ABLE TO EXERCISE CONTROL FROM OVERALL INT ENDED PURPOSES. WE DO NOT THINK IN THE PRESENT CASE THE ASSESSEE HAS GIVEN ONLY A LICENSE AS CLAIMED BY LD. COUNSEL OF THE ASSESSEE BECAUSE OF THE POWERS OF SE LLING, AMALGAMATING ETC. MENTIONED IN THE JDA AND IRREVOC ABLE SPECIAL POWER OF ATTORNEY. THE ISSUE HAS BEEN DISC USSED IN HE JUDGMENT OF JASBIR SINGH SARKARIA (SUPRA) IN FURTHER DISCUSSION WHICH HAS BEEN MADE IN PARA 33 REGARDING POWER OF ATTORNEY (WHICH HAS BEEN REPRODUCED EARLIE R). IN THAT CASE THE POWERS WERE GIVEN TO ENTER UPON AN D SURVEY THE LAND, PREPARE LAY OUT PLANS, SUBMIT BUIL DING PLAN FOR SANCTION WITH THE APPROPRIATE AUTHORITIES TO CONTROL, MANAGE AND LOOK AFTER AND SUPERVISE THE PROPERTY, TO OBTAIN WATER AND SEWERAGE, DISPOSAL AN D ELECTRICITY CONNECTION. IN THAT CASE THE DEVELOPER WAS AUTHORIZED TO MORTGAGE THE PROPERTY TO OBTAIN MONEY FOR MEETING THE COST OF CONSTRUCTION ON SECURITY AND MO RTGAGE OF LAND FALLING ONLY TO THE DEVELOPERS SHARE. IN T HAT CASE IT WAS HELD THAT GPA WAS NOT A LICENSE TO ENTER UPO N FOR DOING SOME PRELIMINARY ACTS IN RELATION TO DEVELOPM ENT OF WORK BUT THE POWER TO CONTROL THE LAND HAS ALSO BEE N CONFIRMED. IT HAS ALSO BEEN NOTED THAT THE AGREEME NT DESCRIBED THE POWER OF ATTORNEY AS IRREVOCABLE AND EXTRA DECLARATION TO THAT EFFECT IN THE POWER OF ATTORNEY IS NOT WITHOUT SIGNIFICANCE. IN CASE BEFORE US, MANY MORE POWERS HAVE BEEN GIVEN TO THDC IN ADDITION TO POWER S WHICH HAVE BEEN DESCRIBED IN THAT JUDGMENT AND POWE R OF ATTORNEY HAS BEEN DESCRIBED AS IRREVOCABLE IN CLAUS E 6.7 OF JDA. THEREFORE, IT IS CLEAR THAT THE ASSESSEE S PLEA THAT THE POSSESSION WAS TO BE GIVEN ONLY AT THE TIM E OF REGISTRATION OF THE JDA, IS NOT CORRECT. ONCE IRRE VOCABLE POWER WAS GIVEN THEN IT CANNOT BE SAID THAT THE POSSESSION WAS NOT GIVEN. THE ISSUE REGARDING REVOCATION OF IRREVOCABLE POWER OF ATTORNEY AND CANCELLATION OF THE JDA WOULD BE DISCUSSED LATER ON WHILE DEALING WITH THAT CONTENTION. 57 WE FIND FORCE IN THE SUBMISSIONS OF THE LD. DR FOR THE REVENUE THAT INTERPRETATION OF CLAUSE (V) TO SE CTION 2(47) SHOULD BE MADE IN THE LIGHT OF HEYDONS RULE. THERE IS NO FORCE IN THE OBJECTION OF THE LD. COUNS EL OF THE ASSESSEE THAT THIS CLAUSE SHOULD BE INTERPRETED ON GENERAL RULES OF INTERPRETATION PARTICULARLY IN THE LIGHT OF THE FACT THAT NO REASON HAS BEEN GIVEN FOR THE SAME . HEYDONS RULE HAS BEEN APPLIED BY THE INDIAN COURTS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 107 MANY TIMES. THE RULE WAS APPLIED AND INITIATED IN HEYDONS CASE (1584) 3 CO. REP 7A. THIS RULE WAS UPHELD BY THE CONSTITUTION BENCH OF HON'BLE APEX CO URT IN CASE OF BENGAL IMMUNITY CO. LTD. V STATE OF BIHAR (1955) 2 SCR 603 FOR CONSIDERATION OF ARTICLE 286 OF THE CONSTITUTION. IT HAS BEEN HELD IN CASE OF DR. BALI RAM WAMAN HIRAY V. MR. JUSTICE B. LENTIN AND ANOTHER, 176 ITR 1 THAT FOR UNDERSTANDING AMENDMENT IN THE ACT, PERHAPS HEYDONS RULE IS BEST RULE FOR INTERPRETATI ON OF SUCH AMENDMENT. WE FIND THAT WITHOUT MENTIONING THI S RULE LD. AUTHORITY FOR ADVANCE RULING HAS DISCUSSED THIS ISSUE IN PARA 27 OF THE JUDGMENT WHICH WE HAVE EXTR ACTED ABOVE. IT HAS BEEN HELD THAT IF POSSESSION REFER RED TO IN CLAUSE (V) IS TO BE UNDERSTOOD AS EXCLUSIVE BASIS O F THE TRANSFEREE THEN VERY PURPOSE OF THE AMENDMENT OR ENLARGEMENT OF THE DEFINITION OF TRANSFER WOULD GET DEFEATED. WE ARE REPRODUCING FOLLOWING HEAD NOTE O F THE HON'BLE APEX COURT IN CASE OF DR. BALIRAM WAMAN HIR AY V. MR. JUSTICE B. LENTIN AND ANOTHER (SUPRA): THE FOLLOWING PRINCIPLES ENUNCIATED IN HEYDONS CA ASE (1584) 3 CO. REP 7A AND FIRMLY ESTABLISHED, ARE STI LL IN FULL FORCE AND EFFECT: THAT FOR THE SURE AND TRUE INTER PRETATION OF ALL STATUTES IN GENERALS (BE THEY PENAL OR BENEF ICIAL, RESTRICTIVE OR ENLARGING OF THE COMMON LAW), FOUR T HINGS ARE TO BE DISCERNED AND CONSIDERED: (1) WHAT WAS TH E COMMON LAW BEFORE THE MAKING OF THE ACT; (2) WHAT W AS THE MISCHIEF AND DEFECT FOR WHICH THE COMMON LAW DI D NOT PROVIDE; (3) WHAT REMEDY PARLIAMENT HAS RESOLVED AN D APPOINTED TO CURE THE DISEASE OF THE COMMON WEALTH AND (4) THE TRUE REASON OF THE REMEDY. AND THEN, THE O FFICE OF ALL THE JUDGES IS ALWAYS TO MAKE SUCH CONSTRUCTION AS SHALL SUPPRESS THE EVASIONS FOR THE CONTINUANCE OF THE MISCHIEF AND PRO PRIVATE COMMANDO AND TO ADD FORCE AND LIFE TO THE CURE AND REMEDY ACCORDING TO THE TRUE I NTENT OF THE MAKERS OF THE ACT PRO BONO PUBLIC. THERE IS NO W THE FURTHER ADDITION THAT REGARD MUST BE HAD NOT ONLY T O THE EXISTING LAW BUT ALSO TO PRIOR LEGISLATION AND TO T HE JUDICIAL INTERPRETATION THEREOF. 58 GOING BY THE HEYDONS RULE OF INTERPRETATION IF WE ANALYZE THE PURPOSE OF CLAUSE (V) OF SECTION 2(47) THEN IT WOULD EMERGE THAT LAW BEFORE MAKING THE AMENDMENT W AS THAT CAPITAL GAIN COULD BE CHARGED ONLY IF A TRANSF ER HAS BEEN EFFECTED AND TRANSFER WAS INTERPRETED BY VARIO US COURTS INCLUDING THE DECISION OF HON'BLE SUPREME CO URT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 108 IN CASE OF ALAPATI VENKATRAMIAN V CIT, 57 ITR 185 ( SC) THAT PROPER CONVEYANCE OF THE PROPERTY HAS BEEN MAD E UNDER THE COMMON LAW. THE MISCHIEF WAS WITH REGARD TO TRANSFER IN THE SENSE THAT THERE WAS COMMON PRACTIC E THAT PROPERTIES WERE BEING TRANSFERRED IN SUCH A MANNER THAT TRANSFEREE COULD ENJOY THE BENEFIT OF THE PROPERTY WITHOUT EXECUTION OF THE CONVEYANCE DEED. THIRDLY WE NEED T O EXAMINE THE REMEDY WHICH WAS INSERTION OF CLAUSE (V ) AND (VI) SO THAT CASES OF GIVING POSSESSION OF THE PROP ERTY, WERE ALSO COVERED BY THE DEFINITION OF TRANSFER. F OURTHLY, TRUE REASON FOR THIS AMENDMENT WAS TO PLUG A LOOP H OLE IN THE LAW. THEREFORE, CONSIDERING THE PURPOSE OF IN SERTION OF CLAUSE (V) AND (VI) OF SECTION 2(47) AND VARIOUS CLAUSES OF POWER OF ATTORNEY AND JDA IT BECOMES ABSOLUTELY CLEAR THAT THE SOCIETY HAS HANDED OVER THE POSSESSION OF THE PROPERTY TO THDC/HASH. 59 SECOND IMPORTANT CONTENTION ON BEHALF OF THE ASSESSEE IS THAT JDA WAS EXECUTED ON 25.2.2007 AND IF POSSESSION WAS GIVEN THEN HOW THE ASSESSEE WAS HAVI NG POSSESSION IN TERMS OF LATER SALE DEEDS EXECUTED ON 2.3.2007 AND 25.4.2007. THE SOCIETY HAS EXECUTED T WO SALE DEEDS FOR CONVEYANCE OF PARTS OF THE TOTAL LA ND. FIRST SALE DEED HAS BEEN EXECUTED ON 2.3.2007 FOR 3 .08 ACRES AND RECITATION CLAUSE (A) READS AS UNDER: CLAUSE (A) - THE VENDOR IS THE ABSOLUTE OWNER AND I N POSSESSION OF LAND TOTAL MEASURING 169 KANAL 7 MARL AS EQUIVALENT TO APPROX. 21.2 ACRES IN VILLAGE KANSAL, TEHSIL MOHALI AND MORE PARTICULARLY DESCRIBED IN SCHEDULE A HEREUNDER WRITTEN AND DELINEATED IN GREEN COLOUR BOUNDARY LINE IN THE SHIZRA PLAN ISSUED BY THE PATW ARI DATED 23.2.2007. 60 ACCORDING TO THE LD. COUNSEL OF THE ASSESSEE IF SOCIETY HAD ALREADY GIVEN THE POSSESSION THEN THE S OCIETY WOULD NOT HAVE / HAD POSSESSION ON 2.3.2007 OF THE LAND. AT FACE VALUE THIS ARGUMENT LOOKS ATTRACTIVE BUT WH EN EXAMINED IN TERMS OF POSSESSION WHICH HAS BEEN EXPLAINED IN CASE OF JASBIR SINGH SARKARIA (SUPRA), ACTUAL REALITY WILL COME FORWARD. IN THIS JUDGMENT CONCEP T OF CONCURRENT POSSESSION HAS ALSO BEEN DISCUSSED AND FOLLOWING EXTRACT OF PARAGRAPH 55 OF SALMONDS JURISPRUDENCE HAS BEEN EXTRACTED WHICH READS AS UN DER: ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 109 IT WAS A MAXIM OF THE CIVIL LAW THAT TWO PERSONS C OULD NOT BE IN POSSESSION OF THE SAME THING AT THE SAME TIME . AS A GENERAL PROPOSITION THIS IS TRUE: FOR EXCLUSIVENE SS IS OF THE ESSENCE OF POSSESSION. TWO ADVERSE CLAIMS OF EXCLUSIVE USE CANNOT BOTH BE EFFECTUALLY REALIZED A T THE SAME TIME. CLAIMS, HOWEVER, WHICH ARE NOT ADVERSE, AND WHICH ARE NOT, THEREFORE, MUTUALLY DESTRUCTIVE, ADM IT OF CONCURRENT REALIZATION. HENCE THERE ARE SEVERAL PO SSIBLE CASES OF DUPLICATE POSSESSION. 1 MEDIATE AND IMMEDIATE POSSESSION CROSS- OBJECTIONS-EXIST IN RESPECT OF THE SAME THING AS ALREADY EXPLAINED. 2 TWO OR MORE PERSONS MAY POSSESS THE SAME THING IN COMMON; JUST AS THEY MAY OWE IT IN COMMON. THE CONCURRENT POSSESSION OF THE OWNER WHO CAN EXER CISE POSSESSION RIGHT TO A LIMITED EXTENT AND FOR A LIMI TED PURPOSE AND THAT OF THE BUYER/DEVELOPER WHO HAS A GENERAL CONTROL AND CUSTODY OF THE LAND CAN VERY WE LL BE RECONCILED. 61 IN FURTHER DISCUSSION IN PARA 26 TO 28 OF THE AB OVE DECISION IT HAS BEEN HELD THAT IT IS NOT NECESSARY IN TERMS OF CLAUSE (V) THAT THE DEVELOPER SHOULD HAVE EXCLUS IVE POSSESSION. THE CONCURRENT POSSESSION OF THE OWNER IS POSSIBLE WHICH GIVES RIGHTS TO A LIMITED EXTENT FOR A LIMITED PURPOSE. THUS IT IS VERY MUCH POSSIBLE TO H OLD CONCURRENT POSSESSION. MERE RECITATION IN THE SALE DEED TO THE EFFECT THAT THE SOCIETY WAS OWNER OF AND IN POSSESSION OF LAND MEASURING 21.2 ACRES, DOES NOT S HOW THAT THE SOCIETY WAS HAVING ACTUAL POSSESSION. WHA T THE SOCIETY WAS HAVING IS ONLY OWNERSHIP RIGHT AND THE POSSESSION WAS ONLY CONCURRENT AS THE POSSESSARY RI GHT. FURTHER IT IS A STANDARD CLAUSE IN THE CONVEYANCE D EED AND IT DOES NOT PROVE OR INDICATE ANYTHING EXCEPT T HAT A PORTION OF LAND MEASURING 3.08 ACRES, HAS BEEN SOLD / CONVEYED TO THE DEVELOPER. IN THE LIGHT OF THIS POS ITION, THIS CONTENTION IS REJECTED. 62 WE FIND NO FORCE IN THE NEXT CONTENTION OF THE LD. COUNSEL OF THE ASSESSEE THAT POSSESSION IF AT ALL W AS GIVEN SHOULD BE HELD TO BE ONLY A LICENSE AS DEFINE D IN SECTION 52 OF INDIAN EASEMENT ACT BECAUSE CLEARLY A S PER ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 110 SECTION 52 OF THIS ACT, WHERE ONE PERSON GRANTS TO ANOTHER OR MANY OTHER PERSONS TO DO SOMETHING UPON IMMOVEABLE PROPERTY WHICH IN THE ABSENCE OF SUCH RI GHT WOULD BE UNLAWFUL. 63 HERE IN CASE BEFORE US, THE RIGHT HAS NOT BEEN GIVEN FOR THE PURPOSE OF DOING SOMETHING BUT ALL THE POSS IBLE RIGHTS IN PROPERTY INCLUDING RIGHT TO SELL, RIGHT T O AMALGAMATE THE PROJECT WITH ANOTHER PROJECT IN THE ADJOINING AREA WHICH MAY BE ACQUIRED LATER, RIGHT T O MORTGAGE ETC. CLEARLY SHOW THAT RIGHTS GIVEN BY THE SOCIETY ARE MUCH MORE LARGER THAN WHAT IS COVERED I N THE TERM LICENSE. 64 FOURTH CONTENTION IS THAT THE MONEY RECEIVED AT THE TIME OF EXECUTION OF JDA CAN BE TERMED AS ADVANCE AND WHAT EVER MONEY HAS BEEN RECEIVED HAS ALREADY BEEN SHOWN AS CAPITAL GAI N. WE FIND NO FORCE IN THIS SUBMISSION BECAUSE SECTION 45 WHICH HAS BEE N EXTRACTED ABOVE CLEARLY PROVIDE FOR TAXING OF PROFITS AND GAINS ARI SING FROM THE TRANSFER. WE HAVE ALREADY DISCUSSED THE IMPLICATION OF SECTION 4 5 R.W.S. 48 WHILE DISCUSSING THE LEGAL POSITION. WE HAD ALSO DISCUSS ED THIS ISSUE IN THE LIGHT OF THE DECISION IN CASE OF JASBIR SINGH SARKARIA (S UPRA) AND POINTED OUT THAT WHEN SECTION 45 IS READ ALONG WITH SECTION 48 IT BECOMES CLEAR THAT WHOLE OF THE CONSIDERATION WHICH IS RECEIVED OR ACC RUED IS TO BE TAXED ONCE CAPITAL ASSET IS TRANSFERRED IN A PARTICULAR Y EAR. 65 WE WOULD LIKE TO DISCUSS THIS ASPECT OF THE ISS UE IN LITTLE MORE DETAIL AND TRY TO UNDERSTAND WHY THE WHOLE OF THE CONSIDER ATION IS REQUIRED TO BE TAXED. AT THE COST OF REPETITION LET US AGAIN REPR ODUCE THE OBSERVATIONS OF THE LD. AUTHORITY IN CASE OF JASBIR SINGH SARKARIA (SUPRA) WHICH WE HAVE EARLIER EXTRACTED AT PARA 40 AND THE RELEVANT PORTI ON IS AS UNDER: 40. ON THE ABOVE, THE HON'BLE AUTHORITY AFTER REFE RRING TO THE PROVISIONS OF SECTION 45 AND OBSERVED AS UNDER: - .THE SECTION CAN BE ANALYSED THUS : (A) TRANSFER OF A CAPITAL ASSET EFFECTED IN THE PRE VIOUS YEAR, (B) RESULTANT PROFITS OR GAINS FROM SUCH TRANSFER, (C) THOSE PROFITS OR GAINS WOULD CONSTITUTE THE INC OME OF THE ASSESSEE/ TRANSFEROR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 111 (D) SUCH INCOME SHALL BE DEEMED TO BE THE INCOME OF THE SAME PREVIOUS YEAR IN WHICH THE TRANSFER HAD TAKEN PLACE . TWO ASPECTS MAY BE NOTED AT THIS JUNCTURE. FIRSTLY , THE EXPRESSION USED IS ARISING WHICH IS NOT TO BE EQUATED WITH THE EXPRESSION RECEIVED. BOTH THESE EXPRESSIONS AND IN ADDITION THERETO, THE EXPRESSION ACCRUE ARE USED IN THE INCOME-TAX ACT EITHER COL LECTIVELY OR SEPARATELY ACCORDING TO THE CONTEXT AND NATURE OF THE CHARGING PROVISION. THE SECOND POINT WHICH DESERVES NOTICE IS THAT BY A DEEMING P ROVISION, THE PROFITS OR GAINS THAT HAVE ARISEN WOULD BE TREATED AS THE INC OME OF THE PREVIOUS YEAR IN WHICH THE TRANSFER TOOK PLACE. THAT MEANS, THE INCOME ON ACCOUNT OF ARISAL OF CAPITAL GAIN SHOULD BE CHARGED TO TAX IN THE SAME PREVIOUS YEAR IN WHICH THE TRANSFER WAS EFFECTED OR DEEMED TO HAVE TAKEN PLACE. THE EFFECT AND AMBIT OF THE DEEMING PROVISION CONT AINED IN SECTION 45 HAS BEEN CONSIDERED IN DECIDED CASES AND LEADIN G TEXT BOOKS. THE FOLLOWING STATEMENT OF LAW IN SAMPATH IYENGARS CO MMENTARY (10TH EDITION REVISED BY SHRI S. RAJARATNAM) BRINGS OUT THE CORRECT LEGAL POSITION : SECTION 45 ENACTS THAT THE CAPITAL GAINS SHALL BY FICTION BE DEEMED TO BE THE INCOME OF THE PREVIOUS YEAR IN WHICH THE TRANSFER TOOK PLACE. SINCE THIS IS A STATUTORY FICTION, THE ACTU AL YEAR IN WHICH THE SALE PRICE WAS RECEIVED, WHETHER IT WAS ONE YEAR, T WO YEARS, THREE YEARS, FOUR YEARS ETC. PREVIOUS TO THE PREVIOUS YEA R OF TRANSFER, IS BESIDE THE POINT. THE ENTIRETY OF THE SUM OR SUMS R ECEIVED IN ANY EARLIER YEAR OR YEARS WOULD BE REGARDED AS THE CAPI TAL GAINS ARISING IN THE PREVIOUS YEAR OF TRANSFER. . . . . IN THE WORDS OF SECTION 45, THE CAPITAL GAI NS ARISING FROM THE TRANSFER 'SHALL BE THE INCOME OF THE PREVIOUS YEAR IN WHICH THE TRANSFER TOOK PLACE'. SO, THE PAYMENTS OF CONSIDER ATION STIPULATED TO BE PAID IN FUTURE WOULD HAVE TO BE ATTRIBUTED, BY STATUTORY MANDATE, TO THE YEAR OF TRANSFER, EVEN AS PAYMENTS MADE PRIOR TO THE YEAR OF TRANSFER. 66 THE ABOVE CLEARLY SHOWS THAT IT IS BECAUSE OF EX PRESSION USED IN SECTION 45 THAT IS ARISING WHICH CANNOT BE EQUATE D WITH RECEIPT. IN THIS RESPECT THE LD. AUTHORITY HAS QUOTED A VERY OLD DEC ISION OF HON'BLE MADRAS HIGH COURT IN CASE OF T.V. SUNDARAM IYENGAAR AND SO NS LTD. V. CIT, 37 ITR 26 (MAD). AT PARA 13 OF THE SAID DECISION IS E XTRACTED IN THE FOLLOWING MANNER: ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 112 13. IN T.V. SUNDARAM IYENGAR AND SONS LTD. V. CIT [ 1959] 37 ITR 26, A DIVISION BENCH OF THE MADRAS HIGH COURT WHILE CONST RUING SECTION 12 B OF THE INDIAN INCOME-TAX ACT, 1922 CLARIFIED THE IMPOR T OF THE EXPRESSION ARISE AS FOLLOWS SECTION 12B DOES NOT REQUIRE THAT PROFITS SHOULD HAVE BEEN ACTUALLY RECEIVED. IT IS SUFFICIENT IF THEY HAVE ARISEN. THR OUGHOUT THE INCOME-TAX ACT THE WORDS ACCRUE AND ARISE ARE USED IN CONTRADI STINCTION TO THE WORD RECEIVE AND INDICATE A RIGHT TO RECEIVE. THIS WAS EXPLAINED BY FRY L.J., IN COLQUHOUN V. BROOKS. THE LEARNED JUDGE OBSERVED: I THINK, THEREFORE, THAT THE WORDS ARISE OR ACCR UING ARE GENERAL WORDS DESCRIPTIVE OF A RIGHT TO RECEIVE PROFITS. SEE ALSO CIT V. ANAMALLAIS TIMBER TRUST LTD. TO ATT RACT THE OPERATION OF SECTION 12B IT IS THEREFORE SUFFICIENT IF THE PROFI TS AROSE. THEY NEED NOT HAVE BEEN ACTUALLY RECEIVED. 14. THUS THE CRITERION OF RIGHT TO RECEIVE THE PROF ITS / GAINS WAS APPLIED IN THAT CASE. 15. THE LEGAL POSITION DOES NOT THEREFORE ADMIT OF ANY DOUBT THAT THE ACTUAL RECEIPT OF THE ENTIRE SALE CONSIDERATION DURING THE YEAR OF TRANSFER IS NOT NECESSARY FOR THE PURPOSE OF COMPUTING CAPITAL GAINS. FURTHER THE EXPRESSION ARISING HAS BEEN DEFINED IN THE ADVANCED LAW LEXICON BY P. RAMANATHA AIYER EDITED BY Y.V. CHANDR ACHUD, FORMER CHIEF JUSTICE OF INDIA: THE WORDS ARISING OR ACCRUING DESCRIBE A RIGHT T O RECEIVE PROFITS, AND THAT THERE MUST BE A DEBT OWED BY SOMEBODY. LD. CO MMISSIONER OF INCOME TAX, WEST BENGAL-II, CALCUTTA V. HINDUSTAN H OUSING AND LAND DEVELOPMENT TRUST LTD. AIR 1986 S.C 1805, 1807. THE EXPRESSION ACCRUAL OF INCOME HAS BEEN DEFINE D IN THE SAME LEXICON AS UNDER: ACCRUAL OF INCOME. E.D JASSOON & C. LTD. V LD. COM MISSIONER OF INCOME TAX, AIR 1954 S.C 470 QUOTED INCOME MAY ACCRUE TO AN ASSESSEE WITHOUT THE ACTUAL RECEIPT OF THE SAME. IF THE ASS ESSEE ACQUIRES A RIGHT TO RECEIVE THE INCOME, THE INCOME CAN BE SAID TO HAVE ACCRUED TO HIM THOUGH IT MAY BE RECEIVED LATER ON ITS BEING ASCERTAINED. THE BASIC CONCEPTION IS THAT HE MUST HAVE ACQUIRED A RIGHT TO RECEIVE THE I NCOME. BHOGILAL V INCOME TAX LD. COMMISSIONER, AIR 1956 BOM 411, 414 (INCOME TAX ACT (11 OF 1992) SS. 16(1) AND (3)} ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 113 67 THE COMBINED READING OF THESE TWO DEFINITIONS SH OW THAT IT (I.E. ACCRUAL) IS NOT EQUAL TO THE RECEIPT OF INCOME. IN FACT IT IS A STAGE BEFORE THE POINT OF TIME WHEN THE INCOME BECOMES RECEIVABL E. IN OTHER WORDS, ONCE THE VESTED RIGHTS COME TO A PERSON THEN IT CAN BE SAID THAT SUCH RIGHT OR INCOME HAS ACCRUED TO SUCH PERSON. THE CONCEPT OF ACCRUAL OR AROUSAL OF INCOME HAS ALSO BEEN DISCUSSED BY THE LD. AUTHOR S. RAJARATNAM IN THE COMMENTARY OF LAW OF INCOME TAX BY SAMPATH IYENGAR XITH EDITION BY DISCUSSING THE MEANING OF ACCRUED AND ARISE AT PA GE 1300 IT HAS BEEN OBSERVE AS UNDER: (1) IMPORTANT PRINCIPLES.- (A) MEANING ACCRUE MEANS TO ARISE OR SPRING AS A NATURAL GROWTH OR RESULT, TO COME BY WAY OF I NCREASE. ARISING MEANS COMING INTO EXISTENCE OR NOTICE OR PRESENTING ITSE LF. ACCRUE CONNOTES GROWTH OR ACCUMULATION WITH A TANGIBLE SHAPE SO AS TO BE RECEIVABLE. IN A SECONDARY SENSE, THE TWO WORDS TOGETHER MEAN TO BE COME A PRESENT AND ENFORCEABLE RIGHT AND TO BECOME A PRESENT RIGHT OF DEMAND. IN THE ACT, THE TWO WORDS ARE USED SYNONYMOUSLY WITH EACH OTHER TO DENOTE THE SAME IDEA OR IDEAS VERY SIMILAR, AND THE DIFFERENCE LIES ONLY IN THIS THAT ONE IS MORE APPROPRIATE THAN THE OTHER, WHEN APPLIED, TO A PARTICULAR CASE. IT WILL INDEED BE DIFFICULT TO DISTINGUISH BETWEEN THE TWO WORDS, BUT IT IS CLEAR THAT BOTH THE WORDS ARE USED IN CONTRADISTINCTION TO THE WORD RECEIVE AND INDICATE A RIGHT TO RECEIVE. THEY REPRESENT A STAGE ANTERIOR TO THE POINT OF TIME WHEN THE INCOME BECOMES RECEIVABLE AND CONNOTE A CHARACTER OF THE INCOME, WHICH IS MORE OR LESS INCHOATE AND WHICH IS SOMETHING LESS THAN A RECEIPT. AN UNENFORCEABLE CLAIM TO RECEIVE AN UNDET ERMINED OR UNDEFINED SUM DOES NOT GIVE RISE TO ACCRUAL. 68 THEREFORE, IT IS NOT ONLY THE MONEY WHICH HAS BEEN RECEIVED BY THE ASSESSEE WHICH IS REQUIRED TO BE TAXED BUT THE CONS IDERATION WHICH HAS ACCRUED TO THE ASSESSEE IS ALSO REQUIRED TO BE TAXE D. IN VIEW OF THIS, THIS CONTENTION IS REJECTED. 69 THE FIFTH CONTENTION MADE BY THE LD. COUNSEL F OR THE ASSESSEE WAS THAT SINCE SECTION 53A OF THE TRANSFER OF PROPERTY ACT ITSELF HAS UNDERGONE AMENDMENT W.E.F. 24.9.2001 BY WHICH THE AGREEMENT REFERRED TO IN THA T SECTION IS REQUIRED TO BE REGISTERED AND THEREFORE, NOW IN SECTION 2(47)(V) ONLY THE AMENDED PROVISIONS CAN BE READ. WE FIND NO FORCE IN THIS CONTENTION. IT IS WELL KN OWN THAT SECTION 53A OF THE TRANSFER OF PROPERTY ACT WAS PAS SED ON EQUITABLE DOCTRINE SO AS TO PROTECT THE TAKING OVER OR RETENTION OF THE POSSESSION BY THE TRANSFEREE. IT WAS NOT A SOURCE BY WHICH TITLE OF IMMOVABLE PROPERTY COULD BE ACQUIRED. SECTION 53A OF TP ACT READ AS UNDER:- ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 114 53A. PART PERFORMANCE.- WHERE ANY PERSON CONTRACTS TO TRANSFER FOR CONSIDERATION ANY IMMOVEABLE PROPERTY BY WRITING SI GNED BY HIM OR ON HIS BEHALF FROM WHICH THE TERMS NECESSARY TO CON STITUTE THE TRANSFER CAN BE ASCERTAINED WITH REASONABLE CERTAIN TY, AND THE TRANSFEREE HAS, IN PART PERFORMANCE OF THE CONTRACT, TAKEN POSSESSION OF THE PROPERTY OR ANY PART THEREOF, OR THE TRANSFEREE, BEING ALREADY IN POSSESSION, CONTINUES IN POSSESSIO N IN PART PERFORMANCE OF THE CONTRACT AND HAS DONE SOME ACT I N FURTHERANCE OF THE CONTRACT, AND THE TRANSFEREE HAS PERFORMED OR IS WILLING TO P ERFORM HIS PART OF THE CONTRACT, THEN, NOTWITHSTANDING THAT THE CONTR ACT, [***]WHERE THERE IS AN INSTRUMENT OF TRANSFER, THAT THE TRANSF ER HAS NOT BEEN COMPLETED IN THE MANNER PRESCRIBED THEREFOR BY THE LAW FOR THE TIME BEING IN FORCE, THE TRANSFEROR OR ANY PERSON CLAIMI NG UNDER HIM SHALL BE DEBARRED FROM ENFORCING AGAINST THE TRANSFEREE A ND PERSONS CLAIMING UNDER HIM ANY RIGHT IN RESPECT OF THE PROP ERTY OF WHICH THE TRANSFEREE HAS TAKEN OR CONTINUED IN POSSESSION, OT HER THAN A RIGHT EXPRESSLY PROVIDED BY THE TERMS OF THE CONTRACT 70 A PLAIN READING OF THE ABOVE PROVISION SHOWS THAT IT PROVIDES A SAFETY MEASURE OR A SHIELD IN THE HANDS OF THE TRANSFEREE TO PROTECT THE POSSESSION OF ANY PROPERT Y WHICH HAS BEEN GIVEN BY THE TRANSFEROR AS LAWFUL POSSESSI ON UNDER A PARTICULAR AGREEMENT OF SALE. THIS POSITIO N OF LAW WAS INCORPORATED IN THE DEFINITION OF TRANSFER BY INSERTION OF CLAUSES (V) & (VI) IN SECTION 2(47) OF THE ACT. IT IS IMPORTANT TO NOTE THAT CLAUSE (V) USES THE EXPRESSI ON CONTRACT OF THE NATURE REFERRED TO IN SECTION 53A OF T.P. ACT, THEREFORE, CLEARLY THE IDEA IS THAT AN AGREEME NT WHICH PROVIDES SOME DEFENSE IN THE HANDS OF TRANSFEREE WA S INCORPORATED UNDER THE DEFINITION OF TRANSFER IN THE INCOME TAX ACT. NOW ORIGINALLY SECTION 53A OF T.P. ACT PROVIDED THAT EVEN IF THE CONTRACT THOUGH REQUIRED TO BE REGISTERED HAS NOT BEEN REGISTERED, WHICH MEANS TH E RIGHT OF DEFENDING THE POSSESSION WAS AVAILABLE EVE N IF THE CONTRACT WAS NOT REGISTERED BUT BY AMENDMENT AC T 48 OF 2001, THE EXPRESSION THOUGH REQUIRED TO BE REGI STERED HAS NOT BEEN REGISTERED, HAS BEEN OMITTED WHICH ME ANS FOR THE PURPOSE OF POSSESSION U/S 53A OF T.P. ACT, A PERSON HAS TO PROVE THAT POSSESSION HAS BEEN GIVEN UNDER A REGISTERED AGREEMENT. IN OTHER WORDS, NOW U/S 53A OF T.P. ACT, THE AGREEMENT REFERRED IS REQUIRED TO BE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 115 REGISTERED. THIS REQUIREMENT CANNOT BE READ IN CLAU SE (V) OF SECTION 2(47) BECAUSE THAT REFERS ONLY TO THE C ONTRACT OF THE NATURE OF SECTION 53A OF T.P. ACT WITHOUT GO ING INTO THE CONTROVERSY WHETHER SUCH AGREEMENT IS REQUIRED TO BE REGISTERED OR NOT. THE LD. COUNSEL FOR THE ASSESSE E HAD REFERRED TO THE DECISION OF HON'BLE SUPREME COURT I N THE CASE OF SURANA STEELS V DCIT 237 ITR 777 (SC) FOR THE PROPOSITION THAT WHEN A SECTION OF A PARTICULAR STA TUTE IS INTRODUCED INTO ANOTHER ACT IT MUST BE READ IN THE SAME SENSE AS IT BORE IN THE ORIGINAL ACT. THE CAREFUL PERUSAL OF THAT JUDGMENT WOULD SHOW THAT SITUATION IS APPLI CABLE ONLY WHEN A PARTICULAR PROVISION OF AN ACT HAS BEEN INCORPORATED IN THE LATER ACT. IN THAT CASE A QUES TION AROSE THAT FOR THE PURPOSE OF MAT PROVISION WHAT I S THE MEANING OF PAST LOSSES OR UNABSORBED DEPRECIATION. IT WAS FOUND THAT IN EXPLANATION TO SECTION 115J CLAUS E (IV), THE FOLLOWING EXPRESSION WAS USED:- (IV) THE AMOUNT OF THE LOSS OR THE AMOUNT OF DEPRECIATION WHICH WOULD BE REQUIRED TO BE SET OFF AGAINST THE PROFIT OF THE RELEVANT PREVIOUS YEAR AS IF THE PROVISIONS OF CLAUSE (B) OF THE FIRST PROVISO T O SUB SECTION (I) OF SECTION 205 OF THE COMPANIES ACT, 1956 (1 OF 1956) ARE APPLICABLE. 71 THE HON'BLE APEX COURT REFERRED TO THE PRINCIPL ES OF STATUTORY INTERPRETATION BY SHRI G.P.SINGH AND EXTR ACTED FOLLOWING PIECE: SECTION 115J, EXPLANATION CLAUSE (IV), IS A PIECE OF LEGISLATION BY INCORPORATION. DEALING WITH THE SUBJECT, JUSTICE G.P. SINGH STATES IN PRINCIPLES OF STATUTORY INTERPRETATION (7TH EDITION, 1999). INCORPORATION OF AN EARLIER ACT INTO A LATER ACT IS A LEGISLATIVE DEVICE ADOPTED FOR THE SAKE OF CONVENIENCE IN ORDER TO AVOID VERBATIM REPRODUCTION OF THE PROVISIONS OF THE EARLIER ACT INTO THE LATER . WHEN AN EARLIER ACT OR CERTAIN OF ITS PROVISIONS AR E INCORPORATED BY REFERENCE INTO A LATER ACT, THE PROVISIONS SO INCORPORATED BECOME PART AND PARCEL OF THE LATER ACT AS IF THEY HAD BEEN 'BODILY TRANSPOSED INTO IT'. THE EFFECT OF INCORPORATION IS ADMIRABLY STATED BY LORD ESHER, M.R. : 'IF A ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 116 SUBSEQUENT ACT BRINGS INTO ITSELF BY REFERENCE SOME OF THE CLAUSES OF A FORMER ACT, THE LEGAL EFFECT OF THAT, AS HAS OFTEN BEEN HELD, IS TO WRITE THOSE SECTIONS INTO THE NEW ACT AS IF THEY HAD BEEN ACTUALLY WRITTEN IN IT WITH THE PEN, OR PRINTED IN IT.(P.233) EVEN THOUGH ONLY PARTICULAR SECTIONS OF AN EARLIER ACT ARE INCORPORATED INTO LATER, IN CONSTRUING THE INCORPORATED SECTIONS IT MAY BE AT TIMES NECESSARY AND PERMISSIBLE TO REFER TO OTHER PARTS OF THE EARL IER STATUTE WHICH ARE NOT INCORPORATED. AS WAS STATED B Y LORD BLACKBURN: 'WHEN A SINGLE SECTION OF AN ACT OF PARLIAMENT IS INTRODUCED INTO ANOTHER ACT, I THINK IT MUST BE READ IN THE SENSE IT BORE IN THE ORIGINAL ACT FROM WHICH IT WAS TAKEN, AND THAT CONSEQUENTLY IT IS PERFECTLY LEGITIMATE TO REFER TO ALL THE REST OF THAT ACT IN ORDER TO ASCERTAIN WHAT THE SECTIONS MEANT, THOUGH THOSE OTHER SECTIONS ARE NOT INCORPORATED IN THE NEW ACT. (P.244) 72 ON THE BASIS OF ABOVE OBSERVATION, IT WAS HELD T HAT MEANING OF PAST LOSSES OR UNABSORBED DEPRECIATION H AS TO BE TAKEN SAME AS WAS DEFINED IN THE COMPANIES ACT. IN THIS CASE IT IS CLEAR THAT PROVISION ITSELF REFERS TO CLAUSE (B) OF SUB SECTION (1) OF SECTION 205 OF COMPANYS ACT 1956 AND THEREFORE, SAME MEANING WAS GIVEN TO PAST LOSSES OR UNABSORBED DEPRECIATION AS IS GIVEN UNDER THE COMPANIES ACT, 1956. 73 IN CASE OF CLAUSE (V) TO SECTION 2(47), CLEARLY THE EXPRESSION USED IS CONTRACT OF THE NATURE REFERRED TO IN SECTION 53A OF T.P. ACT, WHICH MEANS IT IS NOT A C ASE OF INCORPORATION OF ONE PIECE OF LEGISLATION INTO ANOT HER PIECE OF LEGISLATION. IF THAT WAS THE INTENTION OF THE PARLIAMENT, OBVIOUSLY CLAUSE (V) WOULD CONTAIN THE EXPRESSION CONTRACT AS DEFINED UNDER SECTION 53A O F TRANSFER OF PROPERTY ACT, 1882. FURTHER, IT IS SE TTLED POSITION OF LAW THAT ANY INTERPRETATION WHICH COULD RENDER A PARTICULAR PROVISION REDUNDANT SHOULD BE AVOIDED. IF THE CONTENTION OF THE LD. COUNSEL WAS TO BE ACCEPTED, OBVIOUSLY THE PROVISIONS OF CLAUSE (V) OF SECTION 2 (47) OF THE ACT WOULD BECOME REDUNDANT IN THE SENSE THAT REGISTRATION OF AGREEMENT WOULD AGAIN BE MADE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 117 COMPULSORY BUT SINCE PROPERTIES WERE BEING SOLD IN THE MARKET ON POWER OF ATTORNEY BASIS THROUGH UNREGIS TERED AGREEMENTS WHICH WOULD MAKE THIS PROVISION REDUNDAN T. THIS POSITION WE HAVE ALREADY DISCUSSED EARLIER WHI LE DISCUSSING THE HEYDONS RULE IN THE INTERPRETATIONS OF THIS CLAUSE. FURTHER THE ISSUE OF INTERPRETATION OF CLA USE (V) AND AMENDMENT TO SECTION 53A OF THE TRANSFER OF PRO PERTY ACT CAME FOR CONSIDERATION BEFORE THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF SURESH CHANDER AGGARWAL VS ITO 48 SOT 2010. THE TRIBUNAL DISCUSSED THIS ISSUE AT PAGE 7 AND AFTER QUOTING THE PROVISIONS OF SECTION 2(47) AND ALSO SECTION 53A BEFORE AND AFTER AMENDMENT AS WALL AS PARA NOS. 11.1 TO 11.2 OF THE BOARDS CIRCULAR N O. 495 DATED 22.9.1987 OBSERVED AS UNDER:- THE ABOVE CLEARLY SHOWS THAT THERE WAS CERTAIN SIT UATION WHERE PROPERTIES WERE BEING TRANSFERRED WITHOUT REGISTRAT ION OF TRANSFER INSTRUMENTS AND PEOPLE WERE ESCAPING TAX LIABILITIE S ON TRANSFER OF SUCH PROPERTIES BECAUSE THE SAME COULD NOT BE BROUG HT IN THE DEFINITION OF 'TRANSFER' PARTICULARLY IN MANY STATE S OF THE COUNTRY PROPERTIES WERE BEING HELD BY VARIOUS PEOPLE AS LEA SED PROPERTIES WHICH WERE ALLOTTED BY THE VARIOUS GOVT. DEPARTMENT S AND TRANSFERS OF SUCH LEASE WERE NOT PERMISSIBLE. PEOPLE WERE TRA NSFERRING SUCH PROPERTIES BY EXECUTING AGREEMENT TO SELL AND GENER AL POWER OF ATTORNEY AS WELL AS WILL AND RECEIVING FULL CONSIDE RATION, BUT SINCE THE AGREEMENT TO SELL WAS NOT REGISTERED AND THOUGH FUL L CONSIDERATION WAS RECEIVED AND EVEN POSSESSION WAS GIVEN, STILL T HE SAME TRANSACTIONS COULD NOT BE SUBJECTED TO TAX BECAUSE THE SAME COULD NOT COVERED BY THE DEFINITION OF 'TRANSFER'. TO BRI NG SUCH TRANSACTIONS WITHIN THE TAX NET, THIS AMENDMENT WAS MADE. IT HAS TO BE APPRECIATED THAT CLAUSE (V) IN SECTION 2(47) DOES N OT LIFT THE DEFINITION OF PART PERFORMANCE FROM SECTION 53A OF THE TRANSFE R OF PROPERTY ACT, 1882. RATHER, IT DEFINES ANY TRANSACTION INVOLVING ALLOWING OF POSSESSION OF ANY IMMOVABLE PROPERTY TO BE TAKEN OR RETAINED IN PART PERFORMANCE OF A CONTRACT OF THE NATURE REFERRED TO IN SECTION 53A OF THE TRANSFER OF PROPERTY ACT. THIS MEANS SUCH TRANS FER IS HOT REQUIRED TO BE EXACTLY SIMILAR TO THE ONE DEFINED U/S.53A OF THE TRANSFER OF PROPERTY ACT, OTHERWISE LEGISLATURE WOULD HAVE SIMP LY STATED THAT TRANSFER WOULD INCLUDE TRANSACTIONS DEFINED IN SEC. 53A OF THE TRANSFER OF PROPERTY ACT. BUT THE LEGISLATURE IN IT S WISDOM HAS USED THE WORDS 'OF A CONTRACT, OF THE NATURE REFERRED IN SECTION 53A'. THEREFORE, IT IS ONLY THE NATURE WHICH HAS TO BE SE EN. AS DISCUSSED ABOVE, THE PURPOSE OF INSERTION OF CLAUSE (V) WAS T O TAX THOSE TRANSACTIONS WHERE PROPERTIES WERE BEING TRANSFERRE D BY WAY OF GIVING POSSESSION AND RECEIVING FULL CONSIDERATION. THEREFORE, IN OUR HUMBLE OPINION, IN THE CASE OF A TRANSFER WHERE POS SESSION HAS BEEN ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 118 GIVEN AND FULL CONSIDERATION HAS BEEN RECEIVED, THE N SUCH TRANSACTION NEEDS TO BE CONSTRUED AS 'TRANSFER'. THEREFORE, THE AMENDMENT MADE IN SECTION 53A BY WHICH THE REQUIREMENT OF REG ISTRATION HAS BEEN INDIRECTLY BROUGHT ON THE STATUTE NEED NOT BE APPLIED WHILE CONSTRUING THE MEANING OF 'TRANSFER' WITH REFERENCE TO THE INCOME-TAX ACT. 8. THE ABOVE SITUATION FURTHER BECOMES CLEAR IF WE REFER TO THE CELEBRATED DECISION OF HON'BLE SUPREME COURT IN THE CASE OF PODAR CEMENT (P.) LTD. (SUPRA}. IN THAT CASE, THE ASSESSE E WAS OWNER OF FOUR FLATS IN A BUILDING CALLED 'SILVER ARCH'/ON NE PEAN SEA ROAD, BOMBAY. OUT OF THESE FOUR FLATS, TWO WERE PURCHASED DIRECTLY FROM THE BUILDERS, MALABAR INDUSTRIES PVT. LTD., AND TWO WER E PURCHASED BY ITS SISTER CONCERNS WHICH WERE LATER PURCHASED BY THE A SSESSEE. THE POSSESSION OF THE FLATS WAS TAKEN AFTER FULL PAYMEN T OF CONSIDERATION. THE FLATS WERE LET OUT. THE ASSESSEE CONTENDED THAT THE RENTAL INCOME FROM THESE FLATS WAS ASSESSABLE AS 'INCOME F ROM OTHER SOURCES' BECAUSE THE ASSESSEE WAS NOT THE LEGAL OWN ER BECAUSE THE TITLE OF THE PROPERTY HAD NOT BEEN CONVEYED TO THE CO-OPERATIVE SOCIETY WHICH WAS FORMED BY THE PURCHASERS OF THE F LATS. THE HON'BLE COURT NOTED THAT SECTION 27 HAD BEEN AMENDED VIDE C LAUSE 3(A) WHEREIN WHEN A PERSON WAS ALLOWED TO TAKE POSSESSIO N OF THE BUILDING IN PART PERFORMANCE OF THE NATURE REFERRED TO IN SECTION 53A, SUCH PERSON SHALL BE DEEMED TO BE THE OWNER. IT WAS FURTHER OBSERVED THAT FOR ALL PRACTICABLE PURPOSES THE ASSE SSEE WAS THE OWNER AND POSSIBLY THERE CANNOT BE TWO OWNERS OF SA ME PROPERTY AT THE SAME TIME. IN FACT, THE AMENDMENTS TO SECTION 2 7 WERE MADE LATER ON BUT WERE TAKEN INTO COGNIZANCE ON THE BASI S OF ABOVE PRINCIPLE AND ULTIMATELY IT WAS HELD AS UNDER: 'HENCE, THOUGH UNDER THE COMMON LAW 'OWNER' MEANS A PERSON WHO HAS GOT VALID TITLE LEGALLY CONVEYED TO HIM AFTER COMPLY WITH THE REQUIREMENTS OF LAW SUCH AS THE TRA NSFER OF PROPERTY ACT, THE REGISTRATION ACT, ETC., IN THE CO NTEXT SECTION 22 OF THE INCOME-TAX ACT, 1961, HAVING REGARD TO TH E GROUND REALITIES AND FURTHER HAVING REGARD TO THE OBJECT O F THE INCOME- TAX ACT, NAMELY, TO TAX THE INCOME, 'OWNER' IS A P ERSON WHO IS ENTITLED TO RECEIVE INCOME FROM THE PROPERTY IN HIS OWN RIGHT. THE REQUIREMENT OF REGISTRATION OF THE SALE DEED IN THE CONTEXT OF SECTION 22 IS NOT WARRANTED.' THUS, FROM THE ABOVE, IT IS CLEAR THAT IT IS NOT NE CESSARY TO GET THE INSTRUMENT OF TRANSFER REGISTERED FOR THE PURPOSE O F INCOME-TAX ACT WHEN A PERSON HAS GOT A VALID LEGALLY CONVEYED AFTE R COMPLYING WITH THE REQUIREMENTS OF THE LAW. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 119 9. SIMILARLY, IN THE CASE OF MYSORE MINERALS LTD. V. CIT [1999] 239 ITR 775/106 TAXMAN 166 (SC), THE ASSESSEE HAD PURCH ASED FOR THE USE OF ITS STAFF SEVEN LOW INCOME GROUP HOUSES FROM A HOUSING BOARD. THE PAYMENT HAD BEEN MADE AND IN TUR N POSSESSION OF THE HOUSES WAS TAKEN OVER BY THE ASSESSEE. THE A CTUAL CONVEYANCE DEED WAS NOT EXECUTED. THE ASSESSEE CLAI MED DEPRECIATION WHICH WAS DENIED BY THE DEPARTMENT. AF TER GREAT DISCUSSION, IT WAS OBSERVED THAT FOR ALL PRACTICABL E PURPOSES AND FOR THE PURPOSE OF INCOME-TAX ACT, THE ASSESSEE SHALL B E CONSTRUED AS OWNER OF THE PROPERTY. IN FACT, IT WAS HELD AS UNDE R: - 'HELD, REVERSING THE JUDGMENT OF THE HIGH COURT, TH AT THE FINDING OF FACT ARRIVED AT IN THE CASE AT HAND WAS THAT THOUGH A DOCUMENT OF TITLE WAS NOT EXECUTED BY THE HOUSING B OARD IN FAVOUR OF THE ASSESSEE, THE HOUSES WERE ALLOTTED TO THE ASSESSEE BY THE HOUSING BOARD, PART PAYMENT RECEI VED AND POSSESSION DELIVERED SO AS TO CONFER DOMINION OVER THE PROPERTY ON THE ASSESSEE WHEREAFTER THE ASSESSEE HA D IN ITS OWN RIGHT ALLOTTED THE QUARTERS TO THE STAFF AND TH EY WERE BEING ACTUALLY USED BY THE STAFF OF THE ASSESSEE. THE ASS ESSEE WAS ENTITLED TO DEPRECIATION IN RESPECT OF THE SEVEN HO USES IN RESPECT OF WHICH THE ASSESSEE HAD NOT OBTAINED A DE ED OF CONVEYANCE FROM THE VENDOR ALTHOUGH IT HAD TAKEN PO SSESSION AND MADE PART PAYMENT OF THE CONSIDERATION'. THUS, FROM THE ABOVE TWO DECISIONS, IT BECOMES ABSO LUTELY CLEAR THAT FOR THE PURPOSE OF THE INCOME-TAX ACT THE GROUND RE ALITY HAS TO BE RECOGNIZED AND IF ALL THE INGREDIENTS OF TRANSFER HAVE BEEN COMPLETED, THEN SUCH TRANSFER HAS TO BE RECOGNIZ ED. MERELY BECAUSE THE PARTICULAR INSTRUMENT OF TRANSFER HAS N OT BEEN REGISTERED WILL NOT ALTER THE SITUATION. THIS POSITION IS FURT HER STRENGTHENED BY THE FACT THAT LEGISLATURE ITSELF HAS INSERTED CLAUSE (V ) TO SECTION 2(47) AND WHILE REFERRING TO THE PROVISIONS OF SECTION 53A, R EFERENCE HAS BEEN MADE BY STATING THAT CONTRACTS IN THE NATURE OF SE CTION 53A SHOULD ALSO BE COVERED BY THE DEFINITION OF 'TRANSFER'. TH EREFORE, IN OUR HUMBLE VIEW, THE AMENDMENT TO SEC. 53A OF THE TRANS FER OF PROPERTY ACT, WHEREBY THE REQUIREMENT OF THE DOCUMENTS NOT B EING REGISTERED HAS BEEN OMITTED, WILL NOT ALTER THE SITUATION FOR HOLDING THE TRANSACTION TO BE A TRANSFER U/S.2(47)(V) IF ALL OT HER INGREDIENTS HAVE BEEN SATISFIED. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 120 74 THUS, IT IS CLEAR THAT NON REGISTRATION OF AGREE MENT CANNOT LEAD TO THE CONCLUSION THAT PROVISION OF SEC TION 2(47) (V) IS NOT APPLICABLE. SIMILAR VIEW HAS BEEN TAKEN BY ITAT COCHIN BENCH OF THE TRIBUNAL IN CASE OF G.SREENIVASAN VS DCIT 28 TXMANN.COM 200 (COCH.) AND ITAT PUNE BENCH IN THE CASE OF MAHESH NEMICHANDRA GANESHWADE V ITO 21 TAXMANN.COM 136 (PUNE). IN VIE W OF THIS LEGAL POSITION, THIS CONTENTION IS REJECTED . 75 THE NEXT CONTENTION WAS THAT THE DECISION OF HON 'BLE BOMBAY HIGH COURT IN CASE OF CHATURBHUJ DWARKADAS KAPADIA (SUPR A) IS NOT APPLICABLE PARTICULARLY BECAUSE ULTIMATELY IN THAT CASE IT WAS HELD THAT CAPITAL GAIN TAX SHOULD BE CHARGED IN ASSESSMENT YEAR 1999-2000 WHER EAS AGREEMENT WAS EXECUTED IN AUGUST, 1994. 76 WE HAVE ALREADY DISCUSSED THE IMPLICATIONS OF TH E DECISION IN CASE OF CHATURBHUJ DWARKADAS KAPADIA (SUPRA) IN PARA 33 TO 38. WE HAD ALSO EXAMINED WHY IN THAT CASE CAPITAL GAIN WAS NOT HELD TO BE CHARGEABLE IN ASSESSMENT YEAR 1995-96.THERE IS NO NEED TO REPEAT THE SAME AND IN VIEW OF THE SAID OBSERVATIONS, WE REJECT THIS CONTE NTION. 77 THE NEXT CONTENTION IS THAT IT IS NECESSARY FOR INVOKING OF SECTION 2(47)(V) OF THE ACT TO COMPLY WITH THE PROVISIONS OF SECTION 53A OF THE TRANSFER OF PROPE RTY ACT TO THE EXTENT THAT THERE SHOULD BE WILLINGNESS ON THE PART OF THE TRANSFEREE TO PERFORM HIS PART OF THE CONTR ACT. 78 IN THIS ASPECT WE HAVE NO QUARREL WITH THE PROPOSITION THAT FOR INVOKING SECTION 53A PF T.P. ACT READ WITH CLAUSE (V) OF SECTION 2(47), THE TRANSFEREE HA S TO PERFORM OR IS WILLING TO PERFORM HIS PART OF THE CO NTRACT. IN THIS RESPECT AS REFERRED TO BY LD. COUNSEL FOR T HE ASSESSEE, THE COMMENTS OF THE LD. AUTHOR IN THE COMMENTARY BY MULLA DINSHAN FREDERICK MULLA VIDE PARA 16 ARE CLEAR AND SHOWS THAT THIS REQUIREMENT HAS TO BE ABSOLUTE AND UNCONDITIONAL. SOME OBSERVATIONS HAV E BEEN MADE IN THE CASE OF GENERAL GLASS COMPANY PVT LTD VS DCIT (SUPRA). IN THAT CASE IT WAS HELD THAT WIL LINGNESS TO PERFORM FOR THE PURPOSE OF SECTION 53A IS SOMETH ING MORE THAN A STATEMENT OF INTENT AND IT IS UNQUALIFI ED AND UNCONDITIONAL WILLINGNESS ON THE PART OF THE TRANSF EREE TO PERFORM HIS OBLIGATION. IN THAT CASE THE TRANSFERE E HAS AGREED TO MAKE CERTAIN PAYMENTS IN INSTALLMENTS IN CONSIDERATION OF THE DEVELOPMENT AGREEMENT BUT SUCH ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 121 PAYMENTS WERE NOT MADE. LATER ON, THE AGREEMENT WA S MODIFIED AND MORE TIME WAS GIVEN TO THE TRANSFEREE FOR PAYMENT OF SUCH INSTALLMENTS. HOWEVER, THE INSTALL MENTS WERE NOT PAID EVEN UNDER THE MODIFIED TERMS AND TH AT IS WHY IT WAS ULTIMATELY HELD THAT SUCH AGREEMENT CANN OT BE CONSTRUED AS TRANSFER. 79 THE SECOND DECISION REFERRED TO BY LD. COUNSEL FOR THE ASSESSEE IS K. RADIKA V DCIT (SUPRA). IN T HIS CASE, SIMILAR OBSERVATIONS WERE MADE, THOUGH IT IS NOT POINTED OUT IN WHAT RESPECT THE TRANSFEREE HAS FAIL ED TO PERFORM HIS PART BUT IT HAS BEEN OBSERVED THAT THE FACTS OF THE CASE SHOWS THAT TRANSFEREE HAS NOT PERFORMED HI S PART OF THE CONTRACT. 80 THE THIRD JUDGMENT RELIED UPON BY THE LD. COUNSEL FOR THE ASSESSEE IS IN THE CASE OF DCIT V T EJ SINGH (SUPRA). IN THAT CASE LAND WAS ACQUIRED BY T HE GOVERNMENT AND THE MATTER WENT FOR LITIGATION. DURI NG THE PENDENCY OF LITIGATION, THE ASSESSEE ENTERED INTO A DEVELOPMENT AGREEMENT WITH A DEVELOPER FOR THE PURP OSE OF DEVELOPMENT OF THE PROPERTY, HOWEVER, IT WAS CLA RIFIED IN THE AGREEMENT THAT THERE IS LITIGATION IN RESPEC T OF ACQUISITION OF PROPERTY AND THE DEVELOPER HAS TO TA KE CLEARANCE FROM THE GOVERNMENT IN THE MATTER OF DENOTIFICATION OF THE LAND. IT WAS HELD THAT SINCE THE LAND WAS UNDER COMPULSORY ACQUISITION AND NO COMPENSATIO N HAS BEEN RECEIVED, THEREFORE, THERE COULD NOT BE AN Y CAPITAL GAIN TAX U/S 2(47) (III) WHICH DEALS WITH T HE COMPULSORY ACQUISITION. IT WAS FURTHER OBSERVED TH AT ASSESSEE COULD NOT HAVE GIVEN POSSESSION UNLESS AND UNTIL THE LAND WAS DENOTIFIED. SINCE FACTS OF THE CASE ARE DIFFERENT THAN THE CASE IN HAND AND THEREFORE, SAM E ARE NOT RELEVANT FOR OUR PURPOSE. 81 NOW COMING TO THE FACTS, FIRSTLY IT WAS CONTENDED THAT DEVELOPER I.E TRANSFEREE HAS NOT OBT AINED VARIOUS PERMISSIONS WHICH WERE REQUIRED TO BE TAKE N BY THE DEVELOPER AS PER CLAUSES 3.1, 7.9, 8.4 AND 8.6 OF THE JDA. THIS IS NOT CORRECT AS POINTED OUT BY THE LD. CIT DR THAT ASSESSEE HAD ALREADY GOT THE MUNICIPAL PLAN SANCTIONED BUT IN THE MEANTIME PIL WAS FILED BEFORE THE HON'BLE PUNJAB & HARYANA HIGH COURT AGAINST THE IMPLEMENTATION OF THE PROJECT. INITIALLY, THE CONS TRUCTION WAS BANNED BY THE HON'BLE HIGH COURT. HOWEVER, LAT ER ON IT WAS OBSERVED IN THE CWP NO. 20425 OF 2010 AND AS ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 122 CLARIFIED BY THE ORDER OF THE HON'BLE SUPREME COURT THAT REFUSAL OF SANCTION UNDER THE ENVIRONMENT (PROTECTI ON) ACT, THE SOCIETY HAVE SOUGHT A REVIEW OF THE ORDER BECAUSE THE FINDINGS ARRIVED WERE EX.PARTE. NO OR DER IN THE MATTER HAS BEEN PASSED BY THE COMPETENT AUTHORI TY PERHAPS BECAUSE OF THE ORDER OF HIGH COURT. IN THE INTERIM ORDER PASSED IN THE PIL IT HAS BEEN CLARI FIED BY THE HON'BLE SUPREME COURT VIDE ORDER DATED 31.1.201 2 PERMITTING THE CONCERNED AUTHORITY UNDER THE DIFFER ENT STATUTES GOVERNING THE MATTER TO THEIR RESPECTIVE JURISDICTION TO BE DECIDED IN ACCORDANCE WITH LAW. THUS, IT BECOMES CLEAR THAT DEVELOPER I.E. THDC HAS APPLIED FOR VARIOUS PERMISSIONS BEFORE THE RELEVANT AUTHORITIES AND IN SOME CASES PERMISSION WERE DECLINED ON EX.PARTE BAS IS AND IN SOME CASES THE SAME WERE DECLINED IN VIEW OF THE HIGH COURT ORDER BANNING THE CONSTRUCTION. AFTER TH E CLARIFICATION OF THE ORDER OF THE HIGH COURT BY HON 'BLE SUPREME COURT BY ORDER DATED 31.1.2012, THE AUTHORI TIES HAVE ALREADY BEEN PERMITTED TO EXAMINE THE ISSUE ON MERITS UNDER VARIOUS LAWS. FURTHER IN THE JDA THERE IS A CLAUSE 26 WHICH DEALS WITH THE FORCE MAJEURE CLAUSE S. THE CLAUSE 26 (I) TO (V) READS AS UNDER:- FORCE MAJEURE I) NONE OF THE PARTIES SHALL BE LIABLE TO THE OTHER PARTY OR BE DEEMED TO BE IN BREACH OF THIS AGREEMENT BY REASONS OF ANY DELAY IN PERFORMING OR ANY FAILURE T O PERFORM, ANY OF ITS OWN OBLIGATIONS IN RELATION TO THE AGREEMENT, IF THE DELAY OR FAILURE IS DUE TO ANY EV ENT OF FORCE MEJEURE. EVENT OF FORCE MAJEURE IS ANY EVENT CAUSED BEYOND THE PARTIES REASONABLE CONTROL. THE FOLLOWING SHALL BE REGARDED AS ISSUES BEYOND THE PARTIES REASONABLE CONTROL. II) FOR THE PURPOSES OF THIS CLAUSE, AN EVENT OF FO RCE MAJEURE SHALL MEAN EVENTS OF WAR, WAR LIKE CONDITIO NS, BLOCKADES, EMBARGOES, INSURRECTION, GOVERNMENTAL DIRECTIONS, RIOTS, STRIKES, ACTS OF TERRORISM, CIVI L COMMOTION, LOCK-OUTS, SABOTAGE, PLAGUES OR OTHER EPIDEMICS, ACTS OF GOD INCLUDING FIRE, FLOODS, VOLC ANIC ERUPTIONS, TYPHOONS, HURRICANES, STORMS, TIDAL WAVE S, EARTHQUAKE, LANDSLIDES, LIGHTNING, EXPLOSIONS AND O THER NATURAL CALAMITIES, PROLONGED FAILURE OF ENERGY, CO URT ORDERS / INJUNCTIONS, CHARGE OF LAWS, ACTION AND / OR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 123 ORDER BY STATUTORY AND / OR GOVERNMENT AUTHORITY, T HIRD PARTY ACTIONS AFFECTING THE DEVELOPMENT OF THE PROJ ECT, ACQUISITION / REQUISITION OF THE PROPERTY OR ANY PA RT THEREOF BY THE GOVERNMENT OR ANY OTHER STATUTORY AUTHORITY AND SUCH CIRCUMSTANCES AFFECTING THE DEVELOPMENT OF THE PROJECT (EVENT OF FORCE MAJEURE) . III) ANY PARTY CLAIMING RESTRICTION ON THE PERFORMA NCE OF ANY OF ITS OBLIGATIONS UNDER THIS AGREEMENT DUE TO THE HAPPENING OR ARISING OF AN EVENT OF FORCE MAJEURE HEREOF SHALL NOTIFY THE OTHER PARTY OF THE HAPPENIN G OR ARISING AND THE ENDING OF CEASING OF SUCH EVENT OR CIRCUMSTANCE WITH THREE (3) DAYS OF DETERMINING THA T AN EVENT OF FORCE MAJEURE HAS OCCURRED. IN THE EVENT ANY PARTY ANTICIPATES THE HAPPENING OF AN EVENT OF FORC E MAJEURE, SUCH PARTY SHALL PROMPTLY NOTIFY THE OTHER PARTY. IV) THE PARTY CLAIMING EVENT OF FORCE MAJEURE CONDI TIONS SHALL, IN ALL INSTANCES AND TO THE EXTENT IT IS CAP ABLE OF DOING SO, USE ITS BEST EFFORTS TO REMOVE OR REMEDY THE CAUSE THEREOF AND MINIMIZE THE ECONOMIC DAMAGE ARISING THEREOF. V) EITHER PARTY MAY TERMINATE THIS AGREEMENT AFTER GIVING THE OTHER PARTY A PRIOR NOTICE OF FIFTEEN (15) DAYS IN WRITING OF THE EVENT OF FORCE MAJEURE CONTINUES FOR PERIOD OF NINETY (90) DAYS. IN THE EVENT OF TERMIN ATION OF THIS AGREEMENT ALL OBLIGATIONS OF THE PARTIES UN TIL SUCH DATE SHALL BE FULFILLED. 82 THE COMBINED READING OF THESE CLAUSES SHOW THAT IF ANY OF THE PARTY COULD NOT PERFORM ITS PART OF THE OBLIGATION BECAUSE OF THE UNFORESEEN CIRCUMSTANCES WHICH INCLUDED GOVERNMENT DIRECTIONS, COURT ORDERS, INJUN CTIONS ETC. SUCH PARTY WOULD NOT BE LIABLE TO OTHER PARTY. IN VIEW OF FORCE MAJEURE CLAUSE WHICH INCLUDED COURT INJUNC TION IT CAN NOT BE SAID THAT THDC IS NOT WILLING TO PERFORM ITS OBLIGATION. IN FACT DEVELPERS I.E. THDC/HASH WERE PERUSING THE ISSUE OF PERMISSIONS/SANCTIONS VIGOROU SLY. THESE ASPECTS BECOME FURTHER CLEAR IF THE JUDGMENT OF THE HON'BLE PUNJAB & HARYANA HIGH COURT IN CWP NO. 204 25 OF 2010 VIDE ORDER DATED MARCH 26, 2012 IS PERUSED. PARAS 3, 4, 22, 25 & 26 OF THE JUDGMENT READ AS UND ER:- ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 124 3. THE BROAD CONTOURS OF THE PRESENT PROCEEDING HAVING BEEN OUTLINED, WE MAY NOW PROCEED TO TAKE NOTE OF THE SPECIFIC CONTENTIONS OF THE CONTESTING PARTIES AS MADE BEFORE US. HOWEVER, BEFORE WE DO SO, IT MAY BE APPROPRIATE TO MENTION THE SOMEWHAT CONFLICTING STAND OF THE PARTIES WITH REGARD TO THE PRESENT STAGE OF THE APPLICATIONS FILED UNDER THE PROVISIONS OF THE ENVIRONMENT (PROTECTION) ACT AS WELL AS THE WILD LIFE (PROTECTION) ACT. WHILE THE PETITIONER, WHO IS SUPPORTED BY THE RESPONDENT NO.6 - CHANDIGARH ADMINISTRATION, ASSERTS THAT NECESSARY SANCTION/PERMISSION UNDER BOTH THE ACTS HAVE BEEN REFUSED BY ORDERS PASSED BY THE COMPETENT AUTHORITIES, THE PROMOTERS OF THE PROJECT CONTEND T O THE CONTRARY. THE FACTS, AS UNFOLDED BEFORE US, INDICATE THAT AGAINST THE REFUSAL OF SANCTION UNDER THE ENVIRONMENT (PROTECTION) ACT, THE RESPONDENTS HAVE SOUGHT A REVIEW OF THE ORDER ON THE GROUND THA T THE FINDINGS ARRIVED AT, WHICH HAVE FORMED THE BASI S OF THE REFUSAL, ARE EX-PARTE. NO ORDER IN THE REVIE W MATTER HAS BEEN PASSED BY THE COMPETENT AUTHORITY, PERHAPS, BECAUSE OF THE INTERIM ORDER PASSED IN THE PIL WHICH HAS BEEN CLARIFIED BY THE HON'BLE SUPREME COURT BY ORDER DATED 31.1.2012 PERMITTING THE CONCERNED AUTHORITY UNDER THE DIFFERENT STATUTES GOVERNING THE MATTER TO EXERCISE THEIR RESPECTIVE JURISDICTIONS IN ACCORDANCE WITH LAW. INSOFAR AS TH E WILD LIFE (PROTECTION) ACT IS CONCERNED, IT APPEARS THAT THE REJECTION HAS BEEN MADE BY THE CHIEF WILD LIFE WARDEN WHO, THE RESPONDENTS CLAIM, IS MERELY A RECOMMENDING AUTHORITY AND IS REQUIRED TO FORWARD HIS RECOMMENDATION TO THE CENTRAL GOVERNMENT. AS THE REJECTION UNDER THE WILD LIFE (PROTECTION) ACT HAS BEEN MADE BY AN AUTHORITY NOT COMPETENT TO DO, THE PROMOTERS OF THE PROJECT HAVE SOUGHT A REVIEW OF TH E ORDER WHICH IS STILL PENDING FOR THE SAME REASON(S) AS NOTICED ABOVE. 4. ON THESE FACTS WE ARE OF THE VIEW THAT IT WOULD BE PRUDENT ON OUR PART TO TAKE THE VIEW THAT THE ISSUE WITH REGARD TO CLEARANCE/SANCTION UNDER THE TWO ENACTMENTS I.E. ENVIRONMENT (PROTECTION) ACT AND WILD LIFE (PROTECTION) ACT IS PRESENTLY PENDING AND AS THE PROMOTERS OF THE PROJECT HAVE SUBMITTED THEMSELVES TO THE JURISDICTION OF THE AUTHORITIES UNDER THE SAID ENACTMENTS WE SHOULD REFRAIN FROM ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 125 ADDRESSING OURSELVES ON ANY OF THE ISSUES CONNECTED WITH EITHER OF THE TWO STATUTORY ENACTMENTS AS ANY SUCH EXERCISE, EVEN THOUGH MAY BE UNINTENDED, MAY HAVE THE EFFECT OF FETTERING THE JURISDICTION OF STATUTORY AUTHORITIES FUNCTIONING UNDER THE TWO RELEVANT STATUTES. 22. INSOFAR AS THE PROVISIONS OF THE ENVIRONMENT (PROTECTION) ACT AND THE WILD LIFE (PROTECTION) ACT ARE CONCERNED, IT NEED NOT BE EMPHASISED THAT EVERY PROJECT ATTRACTING THE PROVISIONS OF THE PERIPHERY CONTROL ACT AND/OR THE PROVISIONS OF THE 1995 ACT MUST SATISFY THE ECOLOGICAL CONCERNS OF THE AREA IN THE LIGHT OF THE PROVISIONS OF THE TWO STATUES IN QUESTION. AS ALREADY HELD BY US, A PUBLIC TRUST HAS BEEN BESTOWED ON THE AUTHORITIES BY PROVISIONS OF THE SAID ACTS WHICH CAST ON SUCH AUTHORITIES A DUTY TO INTERDICT ANY PROJECT OR ACTIVITY WHICH EVEN REMOTELY SEEMS TO CREATE AN IMBALANCE IN THE PRISTINE ECOLOGY AND ENVIRONMENT OF THE AREA ON WHICH THE CITY OF CHANDIGARH IS SITUATED OR FOR THA T MATTER IN THE IMMEDIATE VICINITY THEREOF. AS ALREAD Y OBSERVED, NECESSARY CLEARANCES UNDER THE AFORESAID TWO ENACTMENTS, INSOFAR AS THE RESPONDENTS ARE CONCERNED, ARE PRESENTLY PENDING BEFORE THE CONCERNED AUTHORITIES AND, THEREFORE, IT WOULD BE HIGHLY INCORRECT ON OUR PART TO ENTER INTO ANY FURT HER DISCUSSION ON THE AFORESAID ASPECT OF THE CASE. 25. WE ALSO HASTEN TO EMPHASISE THAT A MORE RIGOROUS REGULATED DEVELOPMENT IN WHAT ARE NOW THE REMNANTS OF THE PERIPHERY AND THE AREAS ADJOINING T O IT IS THE NEED OF THE HOUR FOR WHICH THE STAKEHOLDE RS I.E. THE ADMINISTRATION OF CHANDIGARH, THE STATES O F PUNJAB AND HARYANA AS ALSO THE AUTHORITIES UNDER THE ENVIRONMENT (PROTECTION) ACT AND THE WILD LIFE PROTECTION ACT HAVE TO DEMONSTRATE THE NEED TO ENGAGE THEMSELVES INTENSIVELY AND NOT ACQUIRE A PLACID APPROACH INDICATING AN ELOQUENT ACQUIESCENCE TO THE VIOLATION OF THE 1995 ACT, PERIPHERY CONTROL ACT AND THE PERIPHERY POLICY. 26. WE THUS CONCLUDE ON THE AFORESAID NOTE BY HOLDING AND OBSERVING THAT THE PROVISIONS OF THE PERIPHERY CONTROL ACT AND THE 1995 ACT ARE COMPLEMENTARY TO EACH OTHER AND THE PROVISIONS OF ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 126 THE TWO STATUTES WOULD APPLY TO THE HOUSING PROJECT IN QUESTION. THE RESPONDENTS, THEREFORE, WILL HAVE TO COMPLY WITH ALL THE REQUIREMENTS SPELT OUT BY BOTH THE AFORESAID STATUTES. AS THE REQUIREMENT OF CLEARANCES UNDER THE WILD LIFE (PROTECTION) ACT AND ENVIRONMENT (PROTECTION) ACT IS NOT A CONTENTIOUS ISSUE, AND AS WE HAVE ALREADY HELD THAT THE PROCESS OF GRANT OF SUCH CLEARANCES IS PENDING BEFORE THE APPROPRIATE AUTHORITIES UNDER THE RESPECTIVE ACTS, THE SAME WILL NOW HAVE TO BE BROUGHT TO ITS LOGICAL CONCLUSION KEEPING IN MIND OUR OBSERVATIONS AND DIRECTIONS CONTAINED HEREINABOVE. 83 THE COMBINED READING OF THE ABOVE PARAS IN THE ORDER OF HON'BLE HIGH COURT CLEARLY SHOWS THAT DEVE LOPER THDC/ HASH I.E. TRANSFEREE HAVE MADE THEIR SINCERE EFFORTS FOR OBTAINING THE NECESSARY PERMISSIONS / SANCTIONS WHICH WERE REQUIRED UNDER THE JDA. HOWEV ER, SOME OF THE SANCTIONS COULD NOT BE TAKEN IN TIME BE CAUSE OF THE LITIGATION BY WAY OF PIL BUT SINCE NONE OF T HE PARTY WAS LIABLE TO THE OTHER PARTY IN VIEW OF THE CLAUSE 26 DEALING WITH FORCE MAJEURE IT CANNOT BE SAID THAT DEVELOPER WAS NOT WILLING TO PERFORM HIS PART OF CO NTRACT. IN ANY CASE NO SPECIFIC EVIDENCE HAS BEEN SHOWN US TO PROVE THAT THDC / HASH WERE DECLINING TO PERFORM PARTICULAR OBLIGATION PROVIDED IN JDA. IN VIEW OF THIS DISCUSSION, IT CANNOT BE SAID THAT TRANSFEREE I.E. DEVELOPER THDC/HASH IS NOT WILLING TO PERFORM HIS P ART OF CONTRACT. 84 SECONDLY, IT WAS CONTENDED THAT PAYMENTS HAVE NOT BEEN MADE AS PER THE JDA. HOWEVER, AGAIN THIS IS NO T CORRECT. AS PER CLAUSE 4(IV) OF THE JDA, THE INSTA LLMENT FOR RS. 31,92,75,000/- WAS REQUIRED TO BE PAID. THE CLAUSE 4(IV) READ AS UNDER:- IV) PAYMENT BEING RS. 31,92,75,000/- (RUPEES ONE CRORE NINETY TWO LACS SEVENTY FIVE THOUSAND ONLY) CALCULATED @ RS. 24,75,000/- (RS. TWENTY FOUR LACS SEVENTY FIVE THOUSAND ONLY) PER PLOT HOLDER OF 500 SQ. YARDS AND (RS. 49,50,000/- (RS. FORTY NINE LACS FIFTY THOUSAND ONLY) AS PER PLOT HOLDER OF 1000 SQUARE YARDS TO BE MADE TO THE OWNER AND / OR THE RESPECTIVE MEMBERS OF THE OWNER (AS THE CASE MAY BE) WITHIN SIX(6) MONTHS FROM THE DATE OF EXECUTION ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 127 OF THIS AGREEMENT OR WITHIN TWO (2) MONTHS FROM TH E DATE OF APPROVAL OF THE PLANS / DESIGN AND DRAWINGS AND GRANT OF THE FINAL LICENCE TO DEVELOP WHERE UPO N THE CONSTRUCTION CAN COMMENCE, WHICHEVER IS LATER, AGAINST WHICH THE OWNER SHALL EXECUTE A REGISTERED SALE DEED FOR LAND OF EQUIVALENT VALUE BEING 6.36 ACRES OUT OF THE PROPERTY AS DEMARCATED IN GREEN COLOUR (ALSO HATCHED IN GREEN COLOUR) IN THE DEMARCATION PLAN ANNEXED HERETO AS ANNEXURE V AND BEARING KHASRA NOS. 123/15, 123/6, 123/7 (BALANCE PART), 123/3 (PART), 123//4//1, 123///4//1 /2, 123//4/2, 123/5/1, 123//5/2, 123//5/3, 112/24/24 (PART) 85 THE CAREFUL READING OF THE SAID CLAUSE OF THE J DA WOULD SHOW THIS PAYMENT WAS REQUIRED TO BE MADE WIT HIN A PERIOD OF SIX MONTHS FROM THE DATE OF EXECUTION O F THIS AGREEMENT OR WITHIN TWO MONTHS FROM THE DATE OF APP ROVAL OF PLAN / SANCTION AND DRAWING GRANT OF FINAL LICEN SE TO DEVELOP WHERE UPON THE CONSTRUCTION CAN COMMENCE, WHICHEVER IS LATER. THUS, THIS INSTALLMENT WAS DEPE NDENT ON TWO CONTINGENCIES FIRST THE EXPIRATION OF A PERI OD OF SIX MONTHS FROM THE DATE OF AGREEMENT OR ALTERNATIVELY ON THE EXPIRATION OF A PERIOD OF TWO MONTHS FROM THE DATE OF APPROVAL OF PLANS / DESIGNS DRAWING ETC. LEADING TO GRANT OF FINAL LICENSES WHICH CAN LEAD TO COMMENCEMENT O F CONSTRUCTION, WHICHEVER IS LATER. THE MATTER WAS TA KEN UP BY WAY OF PIL BY CERTAIN CITIZENS AND ADMINISTRATIO N OF THE UNION TERRITORY BEFORE THE HON'BLE HIGH COURT WHICH INITIALLY STAYED THE SANCTION OF SUCH PLAN ETC. TH IS LED TO SITUATION WHERE CONSTRUCTION COULD NOT BE COMMENCED AND HENCE PAYMENT WAS NOT REQUIRED TO BE MADE IN VIEW O F THE PENDING LITIGATION. THE CLAUSES OF FORCE MAJEURE C AME INTO OPERATION AND THEREFORE, IT CANNOT BE SAID TH AT THE DEVELOPER IS NOT WILLING TO PERFORM ITS PART OF THE CONTRACT. IN ANY CASE THERE IS NO DEFAULT ON THE PART OF THE DEVELOPER AS PAYMENT WAS NOT YET DUE AS PER CLAUSE 4(I)(IV) OF JDA. 86 THIS POSITION WAS INFORMED TO THE SOCIETY BY LE TTER DATED 4.2.2011 BY HASH BUILDER, COPY OF WHICH HAS B EEN FILED AT PAGES 23 & 24 OF THE PAPER BOOK DEALING WI TH THE ADDITIONAL EVIDENCE. THROUGH THIS LETTER IT HAS BE EN CLEARLY STATED THAT SINCE PERMISSION IS PENDING FRO M THE MINISTRY OF ENVIRONMENT AND FOREST DEPARTMENT AND THEREFORE CONSTRUCTIONS COULD NOT COMMENCE. THESE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 128 PERMISSIONS WERE PENDING BECAUSE OF THE PIL FILED B Y SHRI AALOK JAGGA BEFORE THE HON'BLE PUNJAB & HARYANA HIG H COURT. ALL THESE FACTS CLEARLY SHOWS THAT IN VIEW OF CLAUSE 4.1(IV) READ WITH CLAUSE 26(V) OF THE JDA, HASH BUI LDER WERE NOT REQUIRED TO MAKE THE PAYMENT AND IT CANNOT BE SAID THAT THEY WERE NOT WILLING TO PERFORM THEIR PA RT OF THE CONTRACT ON THIS ASPECT. THEREFORE, THIS CONTENTIO N IS REJECTED. 87 SEVENTH CONTENTION IS THAT REVENUE WRONGLY HELD THAT EVEN CLAUSE (VI) OF SECTION 2(47) IS APPLICABLE. WE FIND NO FO RCE IN THIS CONTENTION. CLAUSE (VI) TO SECTION 2(47) READS AS UNDER: ANY TRANSACTION (WHETHER BY WAY OF BECOMING A MEM BER OF, OR ACCRUING SHARES IN, A COOPERATIVE SOCIETY, COMPAN Y OR OTHER ASSOCIATION OF PERSONS OR BY WAY OF ANY AGREEMENT OR ANY ARRANGEMENT OR IN ANY OTHER MANNER WHATSOEVER) WH ICH HAS THE EFFECT OF TRANSFERRING, OR ENABLING THE ENJOYMENT OF, ANY IMMOVABLE PROPERTY. 88 THE PLAIN READING OF THE PROVISION SHOWS THAT A NY TRANSACTION BY WAY OF BECOMING A MEMBER OR ACQUIRING SHARES IN THE COOPERATIVE SOCIETY OR SHARES IN THE COMPANY WHICH HAS THE EFF ECT OF TRANSFERRING OR ENABLING THE ENJOYMENT OF ANY IMMOVEABLE PROPERTY W OULD BE COVERED BY THE DEFINITION OF TRANSFER. IN THE CASE BEFORE US, INITIALLY THE MEMBERS OF THE SOCIETY WERE HOLDING SHARES IN THE SOCIETY FOR OWNERSHIP OF PLOT OF 500 SQYD OR 1000 SQYD. THIS MEMBERSHIP WAS SURRENDERED TO THE SOCIETY VIDE RESOLUTION OF THE SOCIETY PASSED IN THE EXECUTIVE C OMMITTEE ON 4.1.2007 WHICH WAS LATER RATIFIED IN THE GENERAL BODY MEETIN G OF THE SOCIETY ON 25.1.2007, SO THAT THE SOCIETY COULD ENTER INTO JDA . IN THE JDA THE SOCIETY HAS AGREED TO TRANSFER THE LAND. THEREFORE , TECHNICALLY IT CAN BE SAID THAT THE DEVELOPER I.E. THDC/HASH HAS PURCHASE D THE MEMBERSHIP OF THE MEMBERS IN THE SOCIETY WHICH WOULD LEAD TO E NJOYMENT OF THE PROPERTY AND IN THAT TECHNICAL SENSE, CLAUSE (VI) O F SECTION 2(47) IS APPLICABLE. 89 EIGHTH CONTENTION IS THAT SINCE THE SOCIETY HAS TRANSFERRED THE LAND THROUGH JDA ON A PRO-RATA BASIS, THEREFORE, ONLY W HATEVER MONEY IS RECEIVED AGAINST WHICH SALE DEEDS HAVE ALSO BEEN EX ECUTED, CAN BE TAXED AND NOTIONAL INCOME I.E. THE MONEY TO BE RECEIVED L ATER, CAN NOT BE TAXED. IN THIS REGARD RELIANCE WAS PLACED ON CERTAIN SUPRE ME COURT DECISIONS AND OTHER CASES FOR THE PROPOSITION THAT NOTIONAL I NCOME CANNOT BE TAXED. THERE IS NO NEED TO DISCUSS THE CASES RELIED ON BY THE LD. COUNSEL OF THE ASSESSEE BECAUSE IT IS SETTLED POSITION OF LAW THAT NO NOTIONAL INCOME CAN BE TAXED. THOUGH THERE IS NO QUARREL THAT IT IS A S ETTLED PRINCIPLE OF LAW THAT NOTIONAL INCOME CAN NOT BE TAXED BUT IN CASE OF CAP ITAL GAIN, SECTION 45 WHICH IS CHARGING SECTION AND SECTION 48 WHICH IS C OMPUTATION SECTION, ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 129 MAKES IT ABSOLUTELY CLEAR THAT RIGOR OF TAX IN CASE OF CAPITAL GAIN WOULD COME INTO PLAY ON THE TRANSFER OF CAPITAL ASSET AND TOTAL CONSIDERATION WHICH IS ARISING ON SUCH TRANSFER, HAS TO BE TAXED. SECTION 48 CLEARLY TALKS ABOUT FULL CONSIDERATION RECEIVED OR ACCRUING AS RE SULT OF TRANSFER. THIS ASPECT WE HAVE ALREADY DISCUSSED IN DETAIL AT PARAS 64 TO 68. 90 SECOND ASPECT OF THIS CONTENTION WAS THAT IF CONSIDERATION WHICH HAS NOT BEEN RECEIVED WAS TO BE TAXED THEN THE ASSESSEE WOULD BE DEPRIVED FOR CLAIM ING EXEMPTION U/S 54 AND 54EC. AS OBSERVED ABOVE AS PE R SECTION 45 R.W.S 48 WHOLE OF THE CONSIDERATION, REC EIVED OR ACCRUED HAS TO BE TAXED. EVERY PERSON IS SUPPOS ED TO KNOW THE LAW AND IF THE TRANSACTION IS STRUCTURED I N SUCH A WAY FOR THE TRANSFER OF CAPITAL ASSET THAT SOME OF THE CONSIDERATION WOULD BE RECEIVED LATER THEN SUCH PER SON IS SUPPOSED TO KNOW THE CONSEQUENCES OF THE DENIAL OF SUCH BENEFITS. HOWEVER, IF THE SECTION IS INTERPRETED IN THE MANNER SUGGESTED BY THE LD. COUNSEL OF THE ASSESSEE THEN NO PERSON WOULD PAY CAPITAL GAIN TAX ON TRANSFER O F A PROPERTY. THIS WILL BE CLEAR FROM A SIMPLE EXAMPLE . LET US ASSUME IF A SELLS THE PROPERTY TO B FOR A CONSI DERATION OF RS. 100 CRORES AND RECEIVE ONLY A CONSIDERATION OF 1.00 CRORE AND IT IS MENTIONED IN THE TRANSFER INSTRUMEN T THAT BALANCE OF CONSIDERATION WOULD BE PAID AFTER 20 YEA RS THEN NO TAX CAN BE LEVIED ON SUCH BALANCE CONSIDERA TION OF RS. 99.00 CRORES WHICH HAS NOT BEEN RECEIVED AS PER THE CONTENTION OF THE LD. COUNSEL OF THE ASSESSEE . BUT IN THAT CASE NO TAXES CAN BE LEVIED EVEN AFTER 20 YEAR S BECAUSE NO TRANSFER CAN BE SAID TO HAVE TAKEN PLACE AFTER 20 YEARS AND REVENUE CANNOT DO ANY THING BECAUSE CAPITAL GAIN CAN BE CHARGED U/S 45 ONLY ON TRANSFER OF CAPITAL ASSET. WE DO NOT THINK THAT THIS KIND OF INTERPRETATION CAN BE MADE WHILE INTERPRETING SECTI ON 45 R.W.S. 48 BY INVOKING THE RULE THAT THERE CAN NOT B E ANY TAX ON NOTIONAL RECEIPT. GENERALLY SPEAKING IT IS O NLY THE REAL INCOME WHICH CAN BE TAXED BUT THIS HAS TO BE UNDERS TOOD SUBJECT TO LIMITATIONS. COMMENTING ON THESE LIMITA TIONS, THE LD. AUTHOR SHRI S. RAJARATNAM IN THE COMMENTARY OF LAW OF INCOME TAX BY SAMPAT IYENGARS VOLUME 1, (11 TH EDITION) HAS OBSERVED AT PAGE 343 AS UNDER:- 5. RESERVATIONS ON REAL INCOME THEORY. - WHETHER ACCRUAL OF INCOME HAS TAKEN PLACE OR NOT, MUST BE JUDGED ON THE PRINCIPLE OF THE REAL INCOME THEORY. AFTER ACCRUAL, NON-CHARGING OF TAX ON THE S AME BECAUSE OF CERTAIN CONDUCT BASED ON THE IPSE DIXIT OF A PARTICULAR ASS ESSEE CANNOT BE ACCEPTED. IN DETERMINING THE QUESTION WHETHER IT IS HYPOTHETI CAL INCOME OR WHETHER ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 130 REAL INCOME HAS MATERIALIZED OR NOT, VARIOUS FACTOR S WILL HAVE TO BE TAKEN INTO ACCOUNT. IT WOULD BE DIFFICULT AND IMPROPER TO EXTEND THE C ONCEPT OF REAL INCOME TO ALL CASES DEPENDING UPON THE SELF-SE RVING STATEMENT OF THE ASSESSEE. WHAT HAS REALLY ACCRUED TO THE ASSESSEE H AS TO BE FOUND OUT AND WHAT HAS ACCRUED MUST BE CONSIDERED FROM THE PO INT OF VIEW OR REAL INCOME TAKING THE PROBABILITY OR IMPROBABILITY OF R EALIZATION IN A REALISTIC MANNER, BUT ONCE ACCRUAL TAKES PLACE, ON THE CONDUCT OF THE PARTIES SUBSEQUENT TO THE YEAR OF CLOSING, AN INCOM E WHICH HAS BEEN ACCRUED CANNOT BE MADE NO INCOME. 91 THE ABOVE POSITION CAN BE UNDERSTOOD BY EXAMINI NG SOME OF THE PROVISIONS OF THE ACT WHICH WOULD SHOW THAT CONCEPT OF NOTIONAL INCOME CAN NOT BE EXTENDED IF S PECIFIC PROVISION IS AVAILABLE IN THE ACT. FOR EXAMPLE IN CASE OF INCOME FROM HOUSE PROPERTY, THE INCOME HAS TO BE DETERMINED AS PER SECTION 23. SECTION 22 OF THE INC OME TAX ACT PROVIDES THAT IT IS THE ANNUAL VALUE OF THE PROPERTY WHICH CAN BE TAXED UNDER THE HEAD INCOME FROM HOUSE PROPERTY. SECTOR 23 PRESCRIBES TH E METHOD FOR DETERMINING THE ANNUAL VALUE. SECTION 23(1)(A) READS AS UNDER:- 23. (1) FOR THE PURPOSES OF SECTION 22 , THE ANNUAL VALUE OF ANY PROPERTY SHALL BE DEEMED TO BE (A) THE SUM FOR WHICH THE PROPERTY MIGHT REASONABLY BE EXPECTED TO LET FROM YEAR TO YEAR; OR (B) WHERE THE PROPERTY OR ANY PART OF THE PROPERTY IS L ET AND THE ACTUAL RENT RECEIVED OR RECEIVABLE BY THE OWNER IN RESPECT THEREOF IS IN EXCESS OF THE SUM REFERRED TO IN CLAUSE (A), THE AMOUNT SO RECEIVED O R RECEIVABLE; OR. 92 ON THIS ASPECT THE SETTLED POSITION OF THE LAW I S THAT THE ANNUAL VALUE HAS TO BE DETERMINED EVEN IF THE PROPERTY IS NOT LET OUT. THIS POSITION HAS BEEN DISCUSSED BY THE LD. AUTHOR CHATU RVEDI & PITHISARIAS IN COMMENTARY OF INCOME TAX LAW (FIFTH EDITION) VOLUME 1 IN THIS RESPECT AT PAGES 1275 & 1276 OBSERVED AS UNDER: ANNUAL VALUE- DETERMINATION OF SECTION 23(1)(A) PROVIDES THAT FOR THE PURPOSES OF SECTION 22, THE ANNUAL VALUE OF ANY PROPERTY SHALL BE DEEMED TO BE THE SUM FOR WHICH THE PROPERTY MIGHT R EASONABLY BE EXPECTED TO LET FROM YEAR TO YEAR. THE WORD USED IS MIGHT AND NOT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 131 CAN OR IS. IT IS THUS A NOTIONAL INCOME TO BE G ATHERED FROM WHAT A HYPOTHETICAL TENANT WOULD PAY WHICH IS TO BE OBJECT IVELY ASCERTAINED ON A REASONABLE BASIS IRRESPECTIVE OF THE FACT WHET HER THE PROPERTY IS LET OUT OR NOT [SULTAN BROS. PR. LTD. V. CIT, (1964 ) 51 ITR 353 (SC); JAMNADAS PRABHUDAS V. CIT, (1951)20 ITR 160(BOM); D .M. VAKIL V. CIT, (1946) 14 ITR 298, 302(BOM); CIT V. BIMAN BEHA RI SHAW, SHEBAIT, (1968) 68 ITR 815 (CAL); SRI SRI RADHA GOV INDA JEW V. CIT, (1972) 84 ITR 150, 156 (CAL); CIT V. GANGA PROPERTI ES LTD., (1970) 77 ITR 637, 647 (CAL); LIQUIDATOR, MAHMUDABAD PROPE RTIES LTD. V. CIT, (1972) 83 ITR 470 (CAL), AFFIRMED, (1980) 124 ITR 31 (SC); CIT V. ZOROSTRIAN BUILDING SOCIETY LTD., (1976) 102 ITR 499 (BOM); C.J. GEORGE V. CIT, (1973) 92 ITR 137 (KER); D.C. ANAND & SONS V. CIT, (1981) 131 ITR 77 (DEL). ALSO SEE, CIT V. PARBUTTY CHURN LAW, (1965) 57 ITR 609, 619 (CAL); IN THE MATTER OF KRISHNA LAL SEAL, AIR 1932 CAL 836; LALLA MAL SAMGHAM LAL V. CIT, (1936) 4 ITR 250 (LAH); NEW DELHI MUNICIPAL COMMITTEE V. NAND KUMAR BUSSI, (197 7) TAX LR 2130 (DEL)] 93 SIMILAR VIEW HAS BEEN EXPRESSED BY SHRI N.A. PAL KHIVALA IN HIS COMMENTARY ON THE LAW LAND PRACTICE OF INCOME TAX, VOLUME 2 (EIGHTH EDITION) BY KANGA AND PALKHIVALAS OBSERVATION AT P AGES 22 & 23. AGAIN EVEN SHRI S. RAJARATNAM IN THE COMMENTARY OF LAW OF INCOME TAX BY SAMPAT IYENGARS VOLUME 2, (11 TH EDITION) EXPRESSED IDENTICAL VIEWS IN HIS COMMENTARY AT PAGE 2738. 94 IN ALL THE LEADING COMMENTARIES CITED ABOVE, IT HAS BEEN OBSERVED THAT ANNUAL VALUE IS TO BE COMPUTED WHETHER PROPERTY HAS BEEN LET OUT OR NOT. THIS MEA NS THAT NOTIONAL VALUE OF THE PROPERTY HAS TO BE CHARGED TO THE INCOME TAX UNDER THE HEAD INCOME FROM HOUSE PROPER TY. FROM THE ABOVE, IT BECOMES CLEAR THAT THOUGH THERE IS NO REAL INCOME FROM LETTING OUT OF THE PROPERTY, STILL THE NOTIONAL ANNUAL VALUE IS SUBJECTED TO TAX UNDER THE HEAD INCOME FROM HOUSE PROPERTY. HOWEVER, WE MAY MENT ION THAT U/S 23(1)(C) OF THE ACT IF THE PROPERTY IS LET OUT AND THEN REMAINED VACANT FOR SOME PART OF THE YEAR OR F OR WHOLE OF THE YEAR THEN VACANCY ALLOWANCE CAN BE CLA IMED. HERE, IT IS IMPORTANT TO NOTE THAT IF PROPERTY IS N OT LET OUT, THEN NOTIONAL INCOME BECOMES CHARGEABLE TO THE TAX BECAUSE OF PROVISIONS OF SECTIONS 22 AND 23 (1)(A) OF THE ACT. SIMILARLY, UNDER THE MAT PROVISIONS, IT IS BASICALLY THE NOTIONAL INCOME WHICH IS BEING SUBJECTED TO CHA RGE UNDER THE HEAD INCOME FROM BUSINESS AND PROFESSION . A BUSINESSMAN MAY HAVE INCOME OF RS. 100/- BUT BECAUS E OF HIGHER DEPRECIATION ALLOWABLE UNDER THE INCOME-T AX ACT OR SOME OTHER WEIGHTED DEDUCTIONS SAY FOR EXAMPLE I N ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 132 CASE OF EXPENDITURE ON SCIENTIFIC RESEARCH, THE TA XABLE INCOME AS PER THE PROVISIONS OF THE ACT MAY BE ZERO BUT STILL BECAUSE OF THE MAT PROVISIONS, TAX HAS TO BE CHARGED ON BOOK PROFITS. SIMILARLY IN THE CASE OF PRESUMPT IVE TAX PROVISIONS E.G. U/S 44AD IF A PERSON IS CIVIL CONTR ACTOR AND DOES NOT MAINTAIN BOOKS OF ACCOUNT AND HIS TURNOVER IS LESS THAN RS. 60 LAKHS THEN THE PROFIT WOULD BE PRE SUMED TO BE 8% OF TURNOVER EVEN IF HE HAS SUFFERED A LOSS . ANOTHER EXAMPLE OF SECTION 2(22)(E) CAN BE TAKEN. U NDER THIS PROVISION A LOAN OR ADVANCE GIVEN BY CERTAIN COMPANIES TO A SUBSTANTIAL SHARE HOLDER IS TO BE TR EATED AS DEEMED DIVIDEND. SUCH LOAN UNDER THE NORMAL ACCOUNTING PRINCIPLE OR ON COMMERCIAL PRINCIPLES CA NNOT BE REGARDED AS INCOME BUT BECAUSE OF THIS SPECIFIC PROVISION REGARDING DEEMED DIVIDEND SUCH AMOUNT HAS TO BE TREATED AS INCOME OF THE PERSON RECEIVING SUCH L OANS. 95 THE ABOVE POSITION OF LAW MAKES IT ABSOLUTELY CL EAR THAT THEORY OF REAL INCOME IS SUBJECT TO THE PROVIS IONS OF THE ACT AND WHENEVER ANY SPECIFIC PROVISIONS OF THE ACT IS THERE FOR CHARGING OF A PARTICULAR ITEM OF INCOME, THEN THE SAME HAS TO BE CHARGED ACCORDINGLY. IT MAY BE SOMETIMES HARD TO THE ASSESSEES BUT AGAIN IT HAS B EEN HELD IN NUMEROUS DECISIONS THAT FISCAL STATUES HAVE TO BE INTERPRETED ON THE BASIS OF LANGUAGE USED AND THERE IS NO SCOPE FOR EQUITY OR INTENT. LD. AUTHOR SHRI S. RAJ ARATNAM IN THE COMMENTARY OF LAW OF INCOME TAX BY SAMPAT IYENGARS VOLUME 1, PAGE 236 IN THIS REGARD HAS OBS ERVED AS UNDER:- ONCE IT IS SHOWN THAT THE CASE OF THE ASSESSEE COM ES WITHIN THE LETTER OF THE LAW, HE MUST BE TAXED, HOWEVER, GREAT THE HARDSHIP MAY APPEAR TO THE JUDICIAL MIND. CONSIDERATIONS OF HARDSHIP, INJUSTICE OR ANOMALIES DO NOT PLAY ANY USEFUL ROLE IN CONSTRUING TAXING STATUTES UNLESS THERE BE SOME REAL AMBIGUITY . THUS, ANY BENEVOLENT CONSTRUCTION IN FAVOUR OF THE ASSESSEE H AS BEEN HELD TO BE UNCALLED FOR. 96 THEREFORE, IT CAN BE SAID THAT GENERALLY SPEAKIN G NOTIONAL INCOME COULD NOT BE SUBJECTED TO TAX BUT WHENEVER THERE IS A SPECIFIC PROVISION, THE SAME HA S TO BE TAXED. NOW, IN CASE OF CAPITAL GAIN, SECTION 45 RE AD WITH SECTION 48 VERY CLEARLY PROVIDES THAT IT IS THE PRO FIT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 133 ARISING FROM THE TRANSFER OF A CAPITAL ASSET WHI CH WOULD BE SUBJECTED TO CHARGE OF CAPITAL GAIN TAX AND SECT ION 48 CLEARLY PROVIDES FOR TAKING THE TOTAL CONSIDERATION INTO ACCOUNT WHILE COMPUTING THE CAPITAL GAINS. THIS AS PECT WE HAVE ALREADY DISCUSSED IN DETAIL AT PARA NO. 64 TO 68 FROM WHICH IT BECOMES CLEAR THAT IT IS THE WHOLE CONSIDERATION WHETHER RECEIVED OR ACCRUED, WHICH HA S TO BE TAXED UNDER THE CAPITAL GAIN ONCE TRANSFER OF TH E CAPITAL ASSET TAKES PLACE. ACCORDINGLY, THERE IS N O FORCE IN THIS PART OF THE CONTENTION. 97 NOW LET US EXAMINE THE ISSUE OF TAXABILITY OF FL AT ON THE BASIS OF ABOVE PRINCIPLES. RELEVANT PORTION O F CLAUSE 4 OF THE JDA WHICH DEALS WITH CONSIDERATION ARE AS UNDER: 4. CONSIDERATION 4.1 IT IS SPECIFICALLY UNDERSTOOD AND AGREED AMONGS T THE PARTIES THAT THDC SHALL USE ITS EXPERTISE AND ITS BRAND NAME AND / OR ANY OTHER BRAND NAME AT ITS DISCRETION TO DEVELOP THE PROPERTY INTO THE PREMISES AS PER APPLICABLE BUILDING BYE-LAWS OF THE COMPETENT AUTHO RITY AND THE OWNER SHALL HAVE NO OBJECTION TO THE SAME IN WHATSOEVER M ANNER. IN CONSIDERATION OF THE OWNER GRANTING AND ASSIGNING, ITS DEVELOPMENT RIGHTS IN THE PROPERTY, IRREVOCABLY AND IN PERPETUI TY, TO THDC TO DEVELOP THE PROPERTY AND FOR TRANSFER OF THE PROPERTY UPON THE SURRENDER OF ALLOTMENT RIGHTS OF 500 SQ. YARDS AND/OR 1000 SQ. YARDS (AS THE CASE MAY BE) BY ITS MEMBERS TO THE OWNER, VIDE RESOLUTION DA TED 04.01.2007 AND 25.02.2007 (COPY ATTACHED AS PER ANNEXURE I & II), HASH IS COMMITTED TO PAY TO THE OWNER AND / OR THE RESPECTIVE MEMBERS OF THE OWNER (AS THE CASE MAY BE) A TOTAL AMOUNT OF RS. 106,42,50,000/- (RUPEES ONE HUNDRED SIX CRORES FORTY TWO LACS FIFTY THOUSANDS O NLY) CALCULATED @ RS. 82,50,000/- (RUPEES EIGHTY TWO LACS FIFTY THOUS ANDS ONLY) PAYABLE TO 65 MEMBERS HAVING PLOT OF 500 SQ. YARDS EACH, RS . 1,65,00,000/- (RUPEES ONE CRORE SIXTY FIVE LACS ONLY) PAYABLE TO 30 MEMBERS HAVING PLOT OF 1000 SQ. YARDS EACH AND RS. 3,30,00,000/- ( RUPEES THREE CRORES THIRTY LACS ONLY) PAYABLE TO THE OWNER FOR THE 4 PL OTS OF 500 SQ. YARDS EACH, WHICH SHALL TANTAMOUNT TO THE FULL AND FINAL PAYMENT TO THE OWNER AND / OR THE RESPECTIVE MEMBERS OF THE OWNER (AS TH E CASE MAY BE) IN A MANNER SET OUT HEREIN BELOW (PAYMENT). FURTHER, T HE TRANSFER, SALE AND CONVEYANCE OF 21.2 ACRES OF LAND OF THE PROPERTY SH ALL BE MADE BY THE OWNER IN FAVOUR OF THDC PRO RATA TO THE PAYMENT REC EIVED BY THE OWNER AND/OR THE RESPECTIVE MEMBERS OF THE OWNER (AS THE CASE MAY BE) FROM HASH BY EXECUTING SALE DEEDS AND REGISTERING THE SA ME. IT IS EXPRESSLY PROVIDED THAT AS RESOLVED BY THE OWNER, THE TOTAL A MOUNT PAYABLE BY HASH TO THE OWNER AND / OR THE RESPECTIVE MEMBERS O F THE OWNER (AS THE CASE MAY BE) FOR ASSIGNMENT OF THE DEVELOPMENT RIGH TS AND FOR TRANSFER ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 134 AND SALE OF 21.2 ACRES OF LAND OF THE PROPERTY SHAL L BE RS. 106,42,50,000/- (RUPEES ONE HUNDRED SIX CRORES FORTY TWO LACS FIFTY THOUSAND ONLY) AND ONE HUNDRED AND TWENTY NINE (129) FLATS CONSIST ING OF SUPER AREA OF 2250 SQ. FEET (FLATS); ONE FLAT EACH FOR SIXTY FI VE MEMBERS HAVING A PLOT OF 500 SQ. YARDS, TWO FLATS FOR THE (THIRTY) 30 MEMBER S HAVING A PLOT OF 1000 SQ. YARDS AND 4 FLATS TO THE OWNER FOR THE 4 PLOTS OF 500 SQ. YARDS EACH AS PER LIST ANNEXED WITH THIS AGREEMENT AS SCHEDULE B (SALE TRANSACTION) IT IS EXPRESSLY AGREED BETWEEN THE DEVELOPERS THAT HASH SHALL BE RESPONSIBLE FOR MAKING ALL PAYMENTS TO THE OWNER AN D/OR THE RESPECTIVE MEMBERS OF THE OWNER (AS THE CASE MAY BE) AS PER TH E NEGOTIATED AND AGREED TERMS BETWEEN THE OWNER AND HASH, HASH EXPRE SSLY UNDERTAKES TO MAKE TIMELY PAYMENTS OF THE PAYMENT TO THE OWNER AND / OR THE RESPECTIVE MEMBERS OF THE OWNER (AS THE CASE MAY BE ) AS UNDER: 4.2 AS RESOLVED BY THE OWNER, THDC EITHER BY ITSELF OR ALONG WITH HASH SHALL ALLOT THE FLATS IN THE NAME OF MEMBERS O F THE OWNER AS PER LIST ANNEXED WITH THIS AGREEMENT AS SCHEDULE B ATTACHED HEREIN (HEREINAFTER REFERRED TO AS THE ALLOTTEES). THE SPECIFICATIONS OF THE FLATS WOULD BE PROVIDED BY THE DEVELOPERS TO THE OWNER AND MORE PA RTICULARLY DESCRIBED IN THE SCHEDULE C ATTACHED HEREIN (HEREINAFTER REFE RRED TO AS THE SPECIFICATIONS). THE ALLOTMENT LETTERS SHALL BE I SSUED TO THE ALLOTTEES (MEMBERS OF THE OWNER) WITHIN FORTY-FIVE (45) DAYS FROM THE DATE OF SANCTION OF THE BUILDING PLANS / DESIGN AND DRAWING AND ON OBTAINING FINAL LICENSE/PERMISSION FOR THE DEVELOPMENT OF THE PROJE CT FROM THE COMPETENT AUTHORITY. THEREAFTER, THE POSSESSION OF THE FLATS SHALL BE HANDED OVER TO THE ALLOTTEES WITHIN THIRTY(30) MONTHS FORM THE DA TE OF ISSUANCE OF THE ALLOTMENT LETTER. IT IS EXPRESSLY PROVIDED THAT THE PAYMENT TO BE MAD E BY HASH TO THE OWNER AND/OR TO THE RESPECTIVE MEMBE RS OF THE OWNER (AS THE CASE MAY BE) AND THE FLATS TO BE ALLOTTED TO THE ALLOTTEES AS SET OUT IN THIS CLAUSE 4.2 SHALL HEREINAFTER BE COLLECTIVELY REFERRED TO AS THE ENT IRE CONSIDERATION ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 135 98 FROM THIS CLAUSE IT BECOMES ABSOLUTELY CLEAR THAT EACH MEMBER HAVING 500 SQYD OF PLOT WAS ENTITL ED TO RECEIVE ONE FURNISHED FLAT MEASURING 2250SQFT AND MEMBERS HAVING 1000SQYD FLAT WERE ENTITLED TO RECEI VE TWO FURNISHED FLATS. THUS UPON EXECUTION OF THE JD A VESTED RIGHT CAME TO SUCH MEMBERS TO RECEIVE SUCH F LATS. ONCE THIS VESTED RIGHT ARISES OUT OF THE ABOVE CONT RACT IT CAN EASILY BE SAID THAT THIS RIGHT HAS ALSO ACCRUED TO THE ASSESSEE. CLAUSE 4.2 MAKES IT ABSOLUTELY CLEAR THA T DEVELOPER I.E. THDC/HASH WAS TO ALLOT THE LETTERS O F ALLOTMENT WITHIN 45 DAYS FROM FINAL SANCTION FROM T HE COMPETENT AUTHORITY AND SUCH FLATS WERE PART OF ENT IRE CONSIDERATION. MERELY BECAUSE SUCH ALLOTMENT LETTE R HAS NOT BEEN GIVEN BECAUSE OF SANCTIONS / PERMISSIONS C OULD NOT BE OBTAINED BECAUSE OF PUBLIC INTEREST LITIGATI ON BEFORE THE HON'BLE PUNJAB & HARYANA HIGH COURT, IT CANNOT BE SAID THAT SUCH RIGHT HAS NOT ACCRUED. TH OUGH IT MAY BE HARD ON THE ASSESSEE BUT IT IS WELL SETTLED THAT TAXATION AND EQUITY ARE STRANGERS. FURTHER COMMENT ING ON THIS ASPECT SHRI RAJARATHNAM IN HIS COMMENTARY HAS OBSERVED AT PAGE 5164 AS UNDER: IT IS HARD ON THE OWNERS WHEN REQUIRED TO PAY TAX, WHEN HANDING OVER THE POSSESSION FOR PURPOSES OF CONSTRUCTION WITHOUT BEING ABLE TO ENJOY THE CONSTRUCTION, WHICH IS YET TO COMMERCE OR IN THE PROCESS OF CONSTRUCTION BEING PUT UP BY THE DEVELOPER, BUT THE SOLUTION LIES IN STATUTORY CLARIFICATION IN SUCH CASES. IN VIEW OF THE INCRE ASING SCALE OF SUCH DEVELOPMENT AGREEMENTS TO SOLVE THE HOUSING PROBLEM IN THE CITIES, A STATUTORY CLARIFICATION OR CIRCULAR IS OVERDUE. 99 THESE COMMENTS AND THE OTHER DETAILED DISCUSSION ON THIS ASPECT CLEARLY SHOW THAT CAPITAL GAIN TAX HAS TO BE PAID ON THE TOTAL CONSIDERATION ARISI NG ON TRANSFER WHICH WOULD INCLUDE THE CONSIDERATION WHIC H HAS BEEN RECEIVED AS WELL AS THE CONSIDERATION WHICH HA S AROSEN AND BECOME DUE AND MAY BE RECEIVED LATER ON. IN VIEW OF THIS DISCUSSION THIS CONTENTION IS REJECTED . 100 NINTH CONTENTION IS THAT THE ASSESSEE HAS ALREA DY TERMINATED THE AGREEMENT AND HAS REVOKED THE POWER OF ATTORNEY . WE FIND NO FORCE IN THIS SUBMISSIONS. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 136 101 IN THIS REGARD LD. COUNSEL OF THE ASSESSEE HAS RELIED ON THE DECISION OF MUMBAI BENCH OF THE TRIBUNAL IN CASE OF CHEMOSYN LTD. V ACIT (SUPRA). IN THAT CASE THE ASSESSEE-COMPANY WA S OWNER OF TWO PLOTS BEARING 256 & 257 IN GUNDABALI ANDHERI MUMBAI. THE ASSESSEE- COMPANY ENTERED INTO A DEVELOPMENT AGREEMENT WITH D IPITI BUILDERS FOR THE DEVELOPMENT RIGHTS FOR A CONSIDERATION OF RS. 1 6.11 CRORES. DIPITI BUILDERS HAD ALSO AGREED TO CONSTRUCT 18000 SQFT CA RPET AREA FOR THE BENEFIT OF ASSESSEE ON PLOT NO. 256. IN THE RETURN OF INCOME TOTAL CONSIDERATION WAS SHOWN ONLY AT RS. 16.11 CRORES. IT WAS EXPLAINED THAT BEFORE DIPITI BUILDERS COULD START THE DEVELOPMENT /CONSTRUCTION WORK, ENTIRE PROPERTY COMPRISING OF PLOT NO. 256 & 257 WA S SOLD TO A THIRD PARTY M/S FINANCIAL TECHNOLOGY LTD. BY A TRIPARTITE CONVE YANCE DEED EXECUTED ON 5.7.2007 FOR RS. 29.11 CRORES AND THEREFORE, AD DITIONAL CONSIDERATION OF RS. 13 CRORES HAS BEEN OFFERED TO TAX IN ASSESSM ENT YEAR 2008-09. THIS EXPLANATION WAS REJECTED BY THE ASSESSING OFFI CER BECAUSE ACCORDING TO HIM IT WAS A CASE OF TRANSFER U/S 2(47)(V) AND T OTAL CONSIDERATION HAS TO BE CHARGED IN THE YEAR OF TRANSFER. THE TRIBUNAL A FTER CONSIDERING THE PROVISIONS OF SECTION 45 & 48 POSED A QUESTION TO I TSELF THAT WHAT SHOULD BE THE CONSIDERATION IN THE CASE BEFORE THE BENCH. THE CASE LAW RELIED ON BY THE DEPARTMENT WAS REJECTED BECAUSE SAME WAS REL EVANT TO ACCRUAL OF INTEREST. THE BENCH FOLLOWED THE DECISION OF KALPT ARU CONSTRUCTION OVERSEES PVT LTD. 13 SOT 194. IN THAT CASE THE ASS ESSEE HAD AGREED TO SELL TO ITS SUBSIDIARY EQUITY SHARES FOR A CONSIDE RATION OF RS. 1.25 CRORES WHICH WAS FINALLY SETTLED AT RS. 1.00 CRORE AND THE TRIBUNAL HELD THAT THE CONSIDERATION OF RS. 1.00 CRORE HAS TO BE ACCEPTED. 102. FROM THE ABOVE DECISION IT IS NOT CLEAR WHETHE R IN CASE OF KALAPTARU CONSTRUCTION OVERSEES PVT LTD. (SUPRA) WH ICH HAS BEEN FOLLOWED IN ABOVE CASE, WAS CONCERNING CAPITAL GAIN OR NOT? SECONDLY IT IS NOT CLEAR THAT WHETHER THE AMENDED CONSIDERATION I. E. SETTLEMENT FOR RS. 1.00 CRORE WAS MADE IN THE SAME YEAR OR NOT? AS OB SERVED EARLIER WHILE DISCUSSING THE ISSUE OF NOTIONAL INCOME THAT PROVIS IONS OF SECTION 45 R.W.S. 48, ARE ABSOLUTELY CLEAR AND THERE IS NO AMBIGUITY THAT ONCE A CAPITAL ASSET IS TRANSFERRED THEN WHOLE OF THE CONSIDERATION RECE IVED OR ACCRUING HAS TO BE CONSIDERED FOR THE PURPOSE OF TAXATION IN THE YE AR IN WHICH THE TRANSFER HAS TAKEN PLACE. WE FURTHER FIND THAT IN THE JDA T HERE IS A CLAUSE FOR TERMINATION OF THE AGREEMENT. RELEVANT CLAUSE 14 R EADS AS UNDER: TERMINATION 14(I) SAVE AND EXCEPT THE PROVISION OF CLAUSE 26, THDC SHALL AT ALL TIMES HAVE THE RIGHT TO TERMINATE THIS AGREEMENT IN THE E VENT THERE IS ANY MATERIAL BREACH OF THE REPRESENTATIONS, WARRANTIES, UNDERTAKINGS, DECLARATIONS, COVENANTS AND/OR OBLIGATIONS GIVEN BY THE OWNER UNDER THIS AGREEMENT AFTER GIVING THIRTY (30) DAYS WRITTEN NOT ICE FOR RECTIFICATION OF ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 137 SUCH BREACH. IN THE EVENT THE AGREEMENT IS TERMINA TION BY THDC, ALL THE LANDS REGISTERED IN THE NAME OF THDC AS PER THE TER MS OF THIS AGREEMENT UPTO THE DATE OF THE TERMINATION SHALL REMAIN WITH THDC AND THE BALANCE LANDS TO BE TRANSFERRED TO THDC AS PER THE TERMS OF THIS AGREEMENT SHALL NOT BE TRANSFERRED BY THE OWNER IN FAVOUR OF THDC. UPON THE TERMINATION, THE OWNER SHALL REFUND TO THDC THE ADJUSTABLE ADVAN CE/EARNEST MONEY MENTIONED IN CLAUSE 4.1(I) ABOVE WITHIN ONE MONTH O F SUCH TERMINATION. IN THE EVENT OF FAILURE OF THE OWNER TO REFUND THE SAI D AMOUNT, THE OWNER HEREBY AGREES TO EXECUTE A REGISTERED SALE DEED FOR LAND OF EQUIVALENT VALUE IN FAVOUR OF THDC. (II) IN THE EVENT ALL THE REQUISITE GOVERNMENT AND STATUTORY APPROVALS, AUTHORIZATIONS, CONSENTS, LICENSES, APPROVALS OF AL L THE PLANS/DESIGNS AND DRAWINGS AS MAY BE REQUIRED FOR THE DEVELOPMENT OF THIS PROPERTY IN RELATION TO THE PROJECT AND TO UNDERTAKE THE PROJEC T ARE NOT GRANTED WITHIN NINE (9) MONTHS OF THE SUBMISSION OF THE FINAL PLAN S/DESIGNS AND DRAWINGS TO THE COMPETENT AUTHORITY FOR APPROVAL THEN THDC M AY AS ITS SOLE DISCRETION EITHER DECIDE THAT IT DOES NOT DESIRE TO UNDERTAKE AND COMPLETE THE PROJECT AND HENCE TERMINATE THIS AGREEMENT AFTE R GIVING THIRTY (30) DAYS WRITTEN NOTICE IN THIS REGARD OR DECIDE TO WAI T FOR ANY FURTHER TIMES DEEMED FIT BY THDC FOR THE GRANT OF THE AFORESAID A PPROVALS AND LICENSES. IN THE EVENT THE AGREEMENT IS TERMINATED BY THDC, A LL THE LANDS REGISTERED IN THE NAME OF THDC AS PER THE TERMS OF THIS AGREEMENT UPTO THE DATE OF THE TERMINATION SHALL REMAIN WITH THDC AND THE BALANCE LANDS TO BE TRANSFERRED TO THDC AS PER THE TERMS OF THIS AGREEMENT SHALL NOT BE TRANSFERRED BY THE OWNER IN FAVOUR OF THDC. UPON T HE TERMINATION, THE OWNER SHALL REFUND TO THDC THE ADJUSTABLE ADVANCE/E ARNEST MONEY MENTIONED IN CLAUSE 4.1(I) ABOVE WITHIN ONE MONTH O F SUCH TERMINATION. IN THE EVENT OF FAILURE OF THE OWNER TO REFUND THE SAI D AMOUNT, THE OWNER HEREBY AGREES TO EXECUTE A REGISTERED SALE DEED FOR LAND OF EQUIVALENT VALUE IN FAVOUR OF THDC. (III) IN THE EVENT THDC IS UNABLE TO DEVELOP THE PR OPERTY DUE TO REFUSAL/NON GRANT OF APPROVALS, CONSENTS, PERMISSIO N, LICENSES OR REVOCATION OF THE SAME BY THE APPROPRIATE STATUTORY AUTHORITY, THEN THDC MAY AT ITS SALE DISCRETION TERMINATE THIS AGREEMENT . IN THE EVENT THE AGREEMENT IS TERMINATED BY THDC, ALL THE LANDS REGI STERED IN THE NAME OF THDC AS PER THE TERMS OF THIS AGREEMENT UPTO THE DA TE OF THE TERMINATION SHALL REMAIN WITH THDC AND THE BALANCE LANDS TO BE TRANSFERRED TO THDC AS PER THE TERMS OF THIS AGREEMENT SHALL NOT BE TRA NSFERRED BY THE OWNER IN FAVOUR OF THDC. UPON THE TERMINATION, THE OWNE R SHALL REFUND TO ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 138 THDC THE ADJUSTABLE ADVANCE/EARNEST MONEY MENTIONED IN CLAUSE 4.1(I) ABOVE WITHIN ONE MONTH OF SUCH TERMINATION. IN THE EVENT OF FAILURE OF THE OWNER TO REFUND THE SAID AMOUNT, THE OWNER HEREBY A GREES TO EXECUTE A REGISTERED SALE DEED FOR LAND OF EQUIVALENT VALUE I N FAVOUR OF THDC. (IV) THE OWNER SHALL HAVE THE RIGHT TO TERMINATE TH E AGREEMENT ONLY IN THE EVENT OF DEFAULT BY THE DEVELOPERS FOR MAKING T HE PAYMENT IN ACCORDANCE WITH THE TERMS OF THIS AGREEMENT AND THE ALLOTMENT OF FLATS WITHIN THE TIME PERIOD AS MENTIONED IN THIS AGREEME NT AFTER GIVING THIRTY (30) DAYS WRITTEN NOTICE FOR RECTIFICATION OF SUCH BREACH OR ANY FURTHER TIME AS MAY BE DESIRED BY THE OWNER. IN THE EVENT THE A GREEMENT IS TERMINATED BY OWNER, ALL THE LANDS REGISTERED IN TH E NAME OF THDC AS PER THE TERMS OF THIS AGREEMENT UPTO THE DATE OF THE TE RMINATION SHALL REMAIN WITH THDC AND THE BALANCE LANDS TO BE TRANSFERRED T O THDC AS PER THE TERMS OF THIS AGREEMENT SHALL NOT BE TRANSFERRED BY THE OWNER IN FAVOUR OF THDC. UPON THE TERMINATION, THE OWNER SHALL FORFEI T THE ADJUSTABLE ADVANCE/EARNEST MONEY MENTIONED IN CLAUSE 4(I). 103 THE READING OF THE ABOVE CLAUSE WOULD SHOW THAT POWER OF TERMINATION HAS BEEN GIVEN IN MANY CIRCUMSTANCES TO THDC VIDE CLAUSE 14(I), (II) AND (III). THE POWER FOR TERMINATION B Y THE OWNER HAS BEEN MENTIONED IN CLAUSE 14(IV) ONLY. READING OF THIS C LAUSE WOULD SHOW THAT RIGHT TO TERMINATE WITH THE OWNER I.E. THE SOCIETY WAS AVAILABLE ONLY IN CASE OF DEFAULT IN MAKING THE PAYMENT. THE ISSUE REGARD ING DEFAULT FOR MAKING PAYMENT HAS ALREADY BEEN DISCUSSED BY US IN PARAS 8 4 TO 86 ABOVE WHILE DISCUSSING THE ISSUE OF WILLINGNESS ON THE PART OF THE TRANSFEREE TO PERFORM ITS PART OF THE CONTRACT WE HAVE ALREADY HELD THAT THERE WAS NO DEFAULT ON THE PART OF DEVELOPER I.E. THDC/HASH IN MAKING THE PAYMENT, THEREFORE, THE ASSESSEE HAD NO RIGHT TO TERMINATE THE CONTRACT . IN ANY CASE WE FURTHER FIND THAT CLAUSE 20 OF THE JDA REFERS TO AR BITRATION AND IT IS CLEARLY PROVIDED THAT ALL THE DISPUTES UNDER IT SHOULD BE R EFERRED TO THE ARBITRATION. THEREFORE, IF THE SOCIETY HAD SOME GRIEVANCE IT WA S DUTY BOUND TO GIVE A NOTICE FOR APPOINTMENT OF AN ARBITRATOR TO THE DEVE LOPER. IN THE ABSENCE OF SUCH NOTICE THE TERMINATION WILL NOT STAND SCRUTINY OF LAW. HERE IT IS ALSO PERTINENT TO NOTE THAT THOUGH IT WAS STATED THAT IR REVOCABLE POWER OF ATTORNEY HAS BEEN REVOKED AND SOME DOCUMENTS HAVE B EEN FILED BEFORE US FOR REVOCATION BUT CLAUSE 6.7 OF THE JDA WHICH W E HAVE REPRODUCED EARLIER CLEARLY PROVIDES THAT SUCH POWER OF ATTORNE Y CANNOT BE REVOKED. WE REPRODUCE CLAUSE 6.7 AGAIN WHICH IS AS UNDER: ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 139 6.7 THE OWNER SHALL EXECUTE AN IRREVOCABLE SPECIAL POWER OF ATTORNEY GRANTING ITS COMPLETE DEVELOPMENT RIGHTS IN THE PROPERTY IN FAVOUR OF THDC INTERALIA INCLUDING THE RIGHT TO RAISE FINANCE BY MORTGAGING THE PROPERTY AND REGISTER THE CHARGE WITH THE COMPETENT AUTHORITY AND EXECUTE REGISTERED SALE DEEDS) AS SET OUT IN CLAUSE 4.1 (II), (III), (IV) AND (V) AND THE OWNER CONFIRMS, UNDERTAKES, DECLARES AND BINDS ITSELF NOT TO REVOKE THE SAME FOR ANY REASON WHATSOEVER OUT OF IT S OWN WILL AND DISCRETION WITHOUT OBTAINING A SPECIFI C PRIOR WRITTEN CONSENT OF THDC OR ANY OF ITS DULY CONSTITUTED ATTORNEYS. 104 THE ABOVE CLEARLY SHOWS THAT THIS POWER OF ATTO RNEY COULD NOT BE REVOKED FOR ANY REASON WITHOUT OBTAINI NG SPECIFIC PRIOR WRITTEN CONSENT OF THDC/HASH. NO DOCUMENT SHOWING THE CONSENT OF THDC FOR REVOCATION OF THIS IRREVOCABLE POWER OF ATTORNEY HAS BEEN PRODUCE D BEFORE US. WE FAIL TO UNDERSTAND THAT IN THE ABSEN CE OF SUCH DOCUMENT HOW THE ASSESSEE CAN CLAIM THAT THIS POWER OF ATTORNEY HAS BEEN REVOKED. AS DISCUSSED EARLIER WHILE CONSIDERING THE LEGAL POSITION, WE WO ULD AGAIN RECALL THE WORDS OF HON'BLE AUTHORITY FOR ADV ANCE RULING IN CASE OF JASBIR SINGH SARKARIA (SUPRA) WHE REIN AT PARA 33 OF THE DECISION WHILE DISCUSSING THE ISSUE IN RESPECT OF POWER OF ATTORNEY, IT WAS HIGHLIGHTED T HAT EXECUTION OF IRREVOCABLE POWER OF ATTORNEY IS OF SIGNIFICANT NATURE AND THE WORDS IRREVOCABLE ARE VERY IMPORTANT. THE EXPRESSION IRREVOCABLE ITSELF SHO WS THAT NORMALLY SUCH ATTORNEY CANNOT BE REVOKED. THEREFOR E, NO COGNIZANCE CAN BE TAKEN IN RESPECT OF REVOCATION O F THE IRREVOCABLE POWER OF ATTORNEY. IN THE ABSENCE OF S PECIFIC CONSENT AS PROVIDED IN CLAUSE 6.7 OF THE JDA FROM T HDC. 105 WE MAY ALSO NOTE THAT CIT D.R HAS POINTED OUT T HAT TOTAL CONSIDERATION WAS TO BE DETERMINED AS UNDER: (I) CONSIDERATION IN CASH (RS. 82,50,000 X 129 PLOTS) RS. 106,42,50,000/- (II) CONSIDERATION IN KIND (RS. 101,25,000/- X 129 PLOTS) RS. 130,61,25,000/- ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 140 TOTAL RS. 237,03,75,000/- AVERAGE COST OF CONSIDERATION RS. 11.18 CRORES PER ACRE (TOTAL CONSIDERATION OF RS. 237.03 CRORES DIVIDED BY 21.2 ACRES OF LAND) IT IS CLAIMED ON BEHALF OF THE ASSESSEE THAT JDA H AS BEEN CANCELLED AND THE DEVELOPER HAS BEEN ALLOWED TO RETAIN THE PROPER TY WHICH HAS ALSO BEEN CONVEYED TO DEVELOPER THROUGH TWO SALE DEEDS. IF THAT IS SO THEN WHAT WOULD HAPPEN TO THE BALANCE CONSIDERATION BECAUSE I N SUCH SITUATION THE ASSESSEE HAS RECEIVED CONSIDERATION OF ONLY ABOUT RS. 5 CRORESS PER ACRE BECAUSE THE ASSESSEE HAS REGISTERED LAND MEASURING 3.08 ACRES FOR RS. 15.48 CRORES THROUGH FIRST CONVEYANCE DEED, WHEREAS CONSIDERATION AS PER ORIGINAL AGREEMENT WAS RS. 11.18 CRORES PER ACRE AS SHOWN ABOVE. THE DIFFERENCE IS BECAUSE OF NON RECEIPT OF CONSIDERATI ON IN KIND AND THE ASSESSEE HAS NOT SHOWN ANY EVIDENCE THAT IT HAS MAD E THE CLAIM FOR RECEIPT OF BALANCE CONSIDERATION. THIS LEADS TO TH E CONCLUSION THAT THERE WAS NO CANCELLATION OF THE JDA. 106 SOME ARGUMENTS WERE MADE BY BOTH THE PARTIES T HAT IF THE CONTRACT IS FINALLY STAND ABANDONED THEN WHAT WOULD HAPPEN. THE CONTENTION ON BEHALF OF THE ASSESSEE IS THAT IF THE CONTRACT IS A BANDONED THEN THE ASSESSEE WOULD HAVE PAID TAX IN THE YEAR OF TRANSFE R AND WOULD BE LEFT WITH NO RECOURSE FOR RELIEF. THE CONTENTION ON BEHALF O F THE DEPARTMENT WAS THAT THE ASSESSEE COULD ALWAYS FILE REVISED RETURN OR MAKE A PETITION U/S 264 AND SOME RELIEF WAS POSSIBLE IN CASE OF THE ASS ESSEE. HOWEVER, IF REVENUE FAILS TO TAX THE TOTAL CONSIDERATION IN TH E YEAR OF TRANSFER THEN SAME CANNOT BE SUBJECTED TO TAX IN ANY OTHER YEAR. WE FIND THAT THIS QUESTION WAS SERIOUSLY CONSIDERED BY THE LD. AUTHOR ITY FOR ADVANCE RULING IN CASE OF JASBIR SINGH KATARIA (SUPRA) WHICH HAS B EEN RELIED ON BY BOTH THE PARTIES FOR VARIOUS ASPECTS. IN THAT CASE IT W AS OBSERVED AT PARA 39 AS UNDER: WE HAVE TO ADVERT TO ONE ASPECT WHICH HAS CAUSED S OME CONCERN TO US. WHAT WILL HAPPEN IF DURING THE YEAR FOLLOWING THE O NE IN WHICH THE DEEMED TRANSFER TOOK PLACE, THE PROPOSED VENTURE COLLAPSES FOR REASONS SUCH AS REFUSAL OF PERMISSIONS, THE DEVELOPER FACING FINANC IAL CRUNCH ETC. BY THAT TIME, THE OWNER WOULD HAVE RECEIVED ONLY A PART OF THE AGREED CONSIDERATION, BUT HE IS OBLIGED TO FILE THE RETURN SHOWING THE ENTIRE CAPITAL GAIN BASED ON THE FULL SALE PRICE WHETHER OR NOT RE CEIVED DURING THE YEAR OF DEEMED TRANSFER. IN SUCH AN EVENTUALITY, HARDSHIP MAY BE CAUSED TO THE OWNER WHO WOULD HAVE PAID FULL TAX. NO DOUBT, SUCH A SITUATION COULD BE AVOIDED IF THE CONTENTION OF THE APPLICANT IS ACCEP TED. ON DEEP ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 141 CONSIDERATION, HOWEVER, WE FIND THAT THE CONSTRUCTI ON OF THE RELEVANT PROVISION SHOULD NOT BE CONTROLLED BY GIVING UNDUE IMPORTANCE TO SUCH HYPOTHETICAL SITUATIONS. NORMALLY, THE OWNER EXECU TES A POWER OF ATTORNEY OR DOES SIMILAR ACT TO LEFT THE TRANSFEREE TAKE POS SESSION ONLY AFTER THE BASIC PERMISSIONS ARE GRANTED AND HE IS SATISFIED A BOUT THE ABILITY OF TRANSFEREE/DEVELOPER TO FULFIL THE CONTRACT. IN SP ITE OF THAT, IF SUCH RATE SITUATIONS TAKE PLACE, THE OWNER/TRANSFEROR WILL NO T BE WITHOUT REMEDY. HE CAN FILE A REVISED RETURN AND MAKE OUT A CASE FOR E XCLUSION OR REDUCTION OF INCOME. HOWEVER, IF THE TIME-LIMIT FOR FILING A RE VISED RETURN EXPIRES, THE DIFFICULTY WILL ARISE. IT IS FOR PARLIAMENT OR THE CENTRAL GOVERNMENT TO PROVIDE A REMEDY TO THE ASSESSEE IN SUCH CASES. MO REOVER, THE OTHER SIDE OF THE PICTURE AS DEPICTED IN PARAGRAPH 27 (SU PRA) SHOULD ALSO BE KEPT IN VIEW. HERE THE COMMENTS OF SHRI RAJARATNAM QUOTED AT PAR A 5164 ABOVE ARE ALSO RELEVANT AGAIN: IT IS HARD ON THE OWNERS WHEN REQUIRED TO PAY TAX, WHEN HANDING OVER THE POSSESSION FOR PURPOSES OF CONSTRU CTION WITHOUT BEING ABLE TO ENJOY THE CONSTRUCTION, WHICH IS YET TO COMMERCE OR IN THE PROCESS OF CONSTRUCTION BEING PUT UP BY THE DEVELOPER, BUT THE SOLUTION LIES IN STATU TORY CLARIFICATION IN SUCH CASES. IN VIEW OF THE INCREA SING SCALE OF SUCH DEVELOPMENT AGREEMENTS TO SOLVE THE HOUSING PROBLEM IN THE CITIES, A STATUTORY CLARIFIC ATION OR CIRCULAR IS OVERDUE. WE MAY MENTION HERE THAT NO DOUBT SOMETIMES AN ASS ESSEE MAY BE PUT IN A DIFFICULT SITUATION AND AS MENTIONED BY HON'BL E AUTHORITY IN CASE OF JASBIR SINGH SARKARIA (SUPRA) AS WELL AS LD. AUTHOR SHRI RAJARATNAM IT IS FOR THE LEGISLATURE TO TAKE CORRECTIVE STEPS. HOWE VER, IT MAY NOT BE OUT OF PLACE THAT IF CONSIDERING THE DIFFICULTY THE INTERP RETATION GIVEN BY THE LD. COUNSEL OF THE ASSESSEE IS ACCEPTED THEN THE REVENU E MAY NOT BE ABLE TO TAX SUCH ASSESSEES WHEN THESE DIFFICULTIES ARE REMO VED. FOR EXAMPLE IN THE PRESENT CASE IF TOMORROW WHEN ALL PERMISSIONS A RE OBTAINED AND CONSTRUCTION IS COMPLETED AND IF NO TAXES ARE HELD TO BE PAYABLE THEN LATER ON ALSO THE ASSESSEE MAY NOT BE SUBJECTED TO ANY TA X UNDER THE HEAD CAPITAL GAIN BECAUSE THEN IT CAN BE EASILY CONTEN DED ON BEHALF OF THE ASSESSEE THAT THE TRANSFER HAS ALREADY TAKEN PLACE ON THE DATE WHEN IRREVOCABLE POWER OF ATTORNEY WAS EXECUTED. IN THA T SITUATION THE REVENUE WILL HAVE NO REMEDY. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 142 107 THE ABOVE CLEARLY SHOWS THAT SUCH HYPOTHETICAL CONSIDERATION CANNOT BE CONSIDERED FOR GIVING TRUE MEANING TO A P ARTICULAR PROVISION. IT HAS ALSO BEEN OBSERVED THAT IN SOME GENUINE CASES T HE DIFFICULTIES MAY ARISE BUT IT WAS FOR THE PARLIAMENT OR THE GOVERNME NT TO PROVIDE REMEDY IN SUCH CASES AND JUDICIAL FORUMS CANNOT DO ANYTHING. THEREFORE, IN VIEW OF THE PROVISIONS OF SECTION 45 R.W.S. 48 WE ARE OF TH E OPINION THAT SUBSEQUENT EVENTS, IF AT ALL ANY WILL NOT MAKE ANY DIFFERENCE BECAUSE TOTAL CONSIDERATION RECEIVED OR ACCRUED HAS TO BE ASSESSE D IN THE YEAR OF TRANSFER. WE MAY ALSO NOTE THAT IT WAS STATED THAT IRREVOCABLE POWER OF ATTORNEY HAS BEEN REVOKED BUT THE WORD IRREVOCABLE ITSELF SHOWS THAT IN THE EYES OF LAW SPECIAL POWER OF ATTORNEY COULD NOT HAVE BEEN REVOKED. IN VIEW OF THIS ANALYSIS, WE ARE OF THE OPINION THA T EITHER THE JDA HAS NOT BEEN CANCELLED OR IN ANY CASE THE SAME CANNOT BE CO NSIDERED FOR DETERMINING THE TAXATION OF CAPITAL GAIN. ACCORDING LY THIS CONTENTION IS REJECTED. 108 THE NEXT CONTENTION OF THE ASSESSEE IS THAT EV EN IF THE WHOLE CONSIDERATION HAS TO BE TAXED THEN VALUE OF THE FLATS CANNOT BE TAKEN AT RS. 4,500/- PER SQ. FEET. IT IS ALSO POINTED OUT THAT IN VIEW OF THE AGREEMENT BETWEEN THE HASH & THDC CONSIDERATION HAS BEEN SHOWN AT RS. 2,000/- PER SQ. FEET FOR 126 FLATS WHEREAS IT IS RS . 4,500/- PER SQ. FEET FOR THREE FLATS. WE FIND NO FORCE IN T HESE SUBMISSIONS. THE ASSESSEE HAS FILED ALONG WITH THE WRITTEN SUBMISSIONS COPY OF THE ADDENDUM OF AGREEME NT BETWEEN THDC AND HASH BY JOINT DEVELOPER (AT PAGE 2 65 & 266) AND THIS ISSUE IS DISCUSSED IN CLAUSE 5 WHI CH IS AS UNDER:- 5. CLAUSES 4.1, 4.2, 4.3 AND 4.4 ON THE PAGE NOS. 18 AND 19 OF THE AGREEMENT SHALL STAND AMENDED, MODIFIED AND SUBSTITUTED BY THE FOLLOWING:- 4.1 IT IS EXPRESSLY AGREED AND UNDERSTOOD BY AND BETWEEN THE PARTIES HERETO (A) IN THE RATIO OF 72,28 BETWEEN THDC AND HASH I N CASE GROSS SALES PROCEEDS DOES NOT EXCEED RS. 1272 CRORES; (B) IN THE RATIO OF 70: 30 BETWEEN THDC AND HASH IN CASE GROSS SALES PROCEEDS IS EQUAL TO RS. 1272 CRORES; ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 143 (C) IN ADDITION (B), IN THE RATIO OF 60: 40 BETWE EN THDC AND HASH IN RESPECT OF GROSS SALES PROCEEDS IN EXCESS OF RS. 1272 CRORES. IT IS AGREED THAT THE MINIMUM GUARANTEED AMOUNT FR OM THE GROSS SALES PROCEEDS FOR THDC AND HASH IS RS. 890.40 CRORES AND RS. 225.76 CRORES RESPECTIVELY. T HE MINIMUM GUARANTEED AMOUNT OF RS. 225.76 CRORES TO HASH INCLUDES RS. 58.88 CRORES THAT SHALL BE EXPEND ED BY THDC TOWARDS CONSTRUCTION OF 126 FLATS EQUIVALEN T TO 2,83,500 SQ. FT,, WHICH FLATS ARE TO BE ALLOTTED IN THE NAMES OF THE MEMBERS OF THE SOCIETY OR OTHERWISE, A S THE CASE MAY BE, CALCULATED AS RS. 2000 PER SQ. FT. FOR THE AREA 2,83,500 SQ. FT. AND THE 72% SHARE OF 3 FLATS OF 2250 SQ. FT. TO BE PURCHASED BY HASH @ RS, 4500/- PER SQ . FT. SHOULD THE APPLICATION OF THE RATIO STIPULATED IN ( A) ABOVE RESULT IN HASH BEING ENTITLED TO A SUM GREATER THAN THE MINIMUM GUARANTEED AMOUNT AND THDC BEING ENTITLED T O A SUM LESS THAN THE MINIMUM GUARANTEED AMOUNT, THDC SHALL-BE ENTITLED TO THE ENTITLEMENT OF HASH WHICH IS IN EXCESS OF ITS MINIMUM, GUARANTEED AMOUNT UNTIL THD C ACHIEVES ITS MINIMUM GUARANTEED AMOUNT.-THE SAME IS ILLUSTRATED IN ANNEXURE I HERETO. 109 THE ABOVE CLEARLY SHOWS THAT HASH WAS ENTITLED TO TOTAL PROCEEDS OF RS. 225.76 CRORES OUT OF TOTAL PR OCEEDS OF THE PROJECT WHICH WERE AGREED TO BE SHARED BY TH DC AND HASH BUT THE PORTION OF HASH INCLUDES A SUM OF RS. 58.88 CRORES WHICH WAS REQUIRED TO BE SPENT TOWARDS CONSTRUCTION OF 126 FLATS EQUIVALENT TO 283500 SQUA RE FEET AREA WHICH WERE TO BE ALLOTTED TO THE MEMBERS OF TH E SOCIETY. THUS, IT IS CLEAR THAT FIGURE OF RS. 2,00 0/- PER SQ. FEET REPRESENTS ONLY THE COST OF CONSTRUCTIONS TO B E INCURRED BY THDC WHICH WAS DEBITED TO THE ACCOUNT O F HASH. FURTHER, HASH HAS AGREED TO PURCHASE THREE F LATS @ 4,500/- PER SQUARE FEET. SOME NEWS REPORTS WERE QUOTED BEFORE US IN ONE OF THE CASES TO SHOW THAT V ARIOUS BROKERS HAD ISSUED VARIOUS ADVERTISEMENTS FOR SALE OF THESE FLATS AND THESE FLATS WERE ULTIMATELY TO BE S OLD AT RS. 7,000/- TO RS. 10,000/- PER SQUARE FEET. THIS A LSO BECOMES CLEAR FROM THE ADDENDUM OF AGREEMENT IN T ERMS OF TOTAL PROCEEDS OF 1272 CRORES. IN ANY CASE IF T HE COST OF CONSTRUCTION IS RS. 2,000/-, THEN COST OF LAND WHICH HAS BEEN PAID TO THE SOCIETY IS ALSO TO BE ADDED TO THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 144 COST OF THE FLAT BECAUSE THIS PORTION OF CONSIDERAT ION IN ANY CASE WAS RECEIVED OR TO BE RECEIVED LATER BY TH E SOCIETY IN CASH. CONSIDERING THE PRESENT MARKET VA LUE OF THE FLATS IN AND AROUND CHANDIGARH AREA WHICH IS RS . 4,000/- TO 12,000/- PER SQUARE FEET WE ARE OF THE O PINION THAT VALUE OF THE FLAT AT RS. 4,500/- PER SQUARE FE ET IS ABSOLUTELY FAIR. IN ANY CASE M/S HASH HAS AGREED T O PURCHASE THE FLATS AT THIS RATE FROM M/S THDC. IT MAY BE NOTED AS POINTED OUT BY THE LD. DR FOR THE REVENUE SOME OF THE NEWS REPORT CLIPPINGS FILED BY VARIOUS ASSES SEES CLEARLY SHOWS THAT FLATS WERE BOOKED IN THE TATA CAMLEOT (THIS WAS THE NAME WHICH WAS GIVEN TO THE PROJECT WHICH WAS TO BE DEVELOPED ON THE LAND OF TW O SOCIETIES) IN THE PRE LAUNCH OFFER IN THE RANGE OF RS. 7500 TO 8000 PER SQFT. IT IS A COMMON KNOWLEDGE THAT RA TES IN PRE LAUNCH OFFER ARE LOWER THAN THE RATES WHEN BOOK INGS OPEN FOR THE PUBLIC. CONSIDERING THESE FACTS WE AR E OF THE OPINION THAT ASSESSING OFFICER HAS ESTIMATED TH E VALUE OF THE FLATS ON MOST REASONABLE BASIS. IN VIEW OF THESE OBSERVATIONS THIS CONTENTION IS REJECTED. 110 THE LD. COUNSEL FOR THE ASSESSEE HAD MADE SOME SUBMISSIONS ON THE ISSUE OF DEDUCTION U/S 54F. HE HAS POINTED OUT THAT THIS ISSUE HAS BEEN REJECTED WRONG LY BY CIT(A). HOWEVER, CAREFULLY PERUSAL OF THE GROUNDS OF APPEAL SHOW THAT NO GROUND IN RESPECT OF DEDUCTION U/S 54F HAS BEEN RAISED BEFORE US AND, THEREFORE, WE DE CLINE TO ADJUDICATE THIS ISSUE AND ALL THE ARGUMENTS MADE IN THIS BEHALF ARE REJECTED. THOUGH REFERENCE WAS MAD E TO GROUND NO. 2.3 IN THIS REGARD. THE PERUSAL OF GROU NDS NO. 2.3 WOULD SHOW THAT REFERENCE HAS BEEN MADE ONLY TO SECTION 54 AND SECTION 54EC. SECTION 54 DEALS WITH DEDUCTION IN CASE THE ASSESSEE BEING AN INDIVIDUAL OR HUF, TRANSFERS THE RESIDENTIAL HOUSE AND IN CASE BE FORE US, THE ASSESSEE HAS TRANSFERRED THE PLOT. THEREFO RE, IT CANNOT BE SAID THAT DEDUCTION U/S 54F AND 54 IS SAM E. SINCE NO GROUND HAS BEEN RAISED FOR DEDUCTION U/S 5 4F, WE REJECT THIS CONTENTION. 111 GROUND NO. 3 - THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT WITHOUT PREJUDICE TO THE ISSUES RAI SED IN GROUNDS NO. 2, 5 & 6, CAPITAL GAIN SHOULD HAVE BEEN TAXED IN THE HANDS OF THE SOCIETY WHICH IS LEGAL OWNER OF THE LAND. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 145 112 ON THE OTHER HAND, THE LD. DR FOR THE REVENUE SUBMITTED THAT THE SOCIETY WAS ACTING ON BEHALF OF THE MEMBERS AND THE MEMBERS HAVE SURRENDERED THEIR RIGH TS IN FAVOUR OF THE SOCIETY SO AS TO ENABLE THE SOCIE TY TO ENTER INTO JDA FOR TRANSFER OF PROPERTY IN FAVOUR O F THE DEVELOPER I.E. THDC/HASH. THEREFORE, CAPITAL ASSE T HAS BEEN SOLD BY THE MEMBERS. FURTHER THE CONSIDERATION WAS TO BE RECEIVED FROM HASH BY THE INDIVIDUAL PLOT OWN ERS. 113 WE HAVE HEARD THE RIVAL SUBMISSIONS CAREFULLY AND FIND THAT THE SOCIETY WAS FORMED BY VARIOUS MEMBERS FOR THE PURPOSE OF PURCHASE OF LAND AND TO DEVELOP THE SAME AND THEY ALLOTTED THE PLOTS TO THE MEMBERS. THE SO CIETY PURCHASED 21.2 ACRES OF LAND AND ULTIMATELY PLOTS I N THE SIZES OF 500SQYD AND 1000SQYD WERE ALLOTTED TO VARI OUS MEMBERS. WHEN THE PROPOSAL FOR DEVELOPMENT OF PROP ERTY CAME IT WAS RESOLVED IN THE GENERAL BODY MEETING OF THE SOCIETY THAT THE MEMBERS WOULD SURRENDER THEIR RIGH TS IN FAVOUR OF THE SOCIETY SO THAT THE SOCIETY CAN ENTE R INTO THE JDA. THUS IT IS CLEAR THAT THE SOCIETY HAS ENT ERED INTO JDA ON BEHALF OF THE MEMBERS. IT IS THE MEMBERS WH O ARE OWNING THE PLOTS AND THE SOCIETY WAS ONLY A FACILIT ATOR. IT BECOMES CLEAR FROM THE JDA THAT PAYMENT FOR CONSIDERATION WAS TO BE MADE TO AN INDIVIDUAL PLOT HOLDER AND IN FACT CONSIDERATION WAS MENTIONED IN TERMS OF PER MEMBER. EACH MEMBER HOLDING 500SQYD PLOT WAS TO RECEIVE A SUM OF RS. 82,50,000/- AND ONE FULLY FURN ISHED FLAT MEASURING 2250 SQFT AND THE MEMBERS HOLDING 1000SQYD PLOT WERE TO RECEIVE MONETARY CONSIDERATIO N OF RS. 1.65 CRORES PLUS TWO FLATS MEASURING 2250 SQFT. IN FACT THE PAYMENT OF CHEQUES IS MADE BY HASH BY ISSU ING CHEQUES IN THE NAME OF INDIVIDUAL MEMBER AND NOT TH E SOCIETY. THIS FACT STANDS ADMITTED BECAUSE ASSESSE E HAS FILED A RETURN DECLARING CAPITAL GAIN AGAINST PART MONEY RECEIVED AGAINST HIS PLOT. THUS IT BECOMES CLEAR T HAT IT IS THE INDIVIDUAL MEMBER WHO ARE LIABLE TO TAX IN RESP ECT OF TRANSFER TO PLOTS AND THE SOCIETY BEING ONLY A FACI LITATOR OR POST OFFICE. SOME MORE DETAILS HAVE BEEN DISCUSSED IN THIS RESPECT WHILE ADJUDICATING THE APPEAL OF PUNJA BI COOP HOUSE BUILDING SOCIETY LTD. IN ITA NO. 310/CHD/2012 AND 556/CHD/2012 WHICH HAVE BEEN ADJUDICATED LITTLE LAT ER IN THIS ORDER ITSELF. ACCORDINGLY WE FIND NO FORCE IN THE SUBMISSIONS AND THIS GROUND IS REJECTED. 114 GROUND NO. 7 THE ISSUE REGARDING LEVY OF INT EREST U/S 234B AND WITHDRAWAL U/S 244A (3) IS OF CONSEQUE NTIAL ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 146 NATURE AND THE ASSESSING OFFICER IS DIRECTED TO CHA RGE INTEREST U/S 234B OF THE ACT IN ACCORDANCE WITH LAW . WITHDRAWAL OF INTEREST U/S 244A (3) SHOULD ALSO BE DONE IN ACCORDANCE WITH LAW. 115 IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTL Y ALLOWED. 38. NOW, WE TAKE UP`THE 24 APPEALS BEFORE THIS BENC H ONE BY ONE AS UNDER: 1) ITA NO.180(ASR)/2011 SHRI SATNAM SINGH KAINTH VS ITO I) GROUNDS NO. 1 & 2 RELATE TO REOPENING OF ASSESS MENT UNDER SECTION 147 OF THE ACT. THE FACTS OF THESE G ROUNDS ARE IDENTICAL TO THE FACTS AS IN THE CASE OF SH.AVTAR SINGH BRAR (SUPRA)AND OTHER 30 APPEALS DECIDED BY THE ITAT CHANDIGARH BENCH IN IT A NO. 448(ASR)/2011 AND OTHERS VIDE ORDER DATED 29.07.201 3 (SUPRA) AND DECISION THEREIN IS, THEREFORE, IDENTICALLY APPLICA BLE IN THE PRESENT CASE. ACCORDINGLY, WE FIND NO INFIRMITY IN THE ORDE R OF THE LD. CIT(A), WHO HAS RIGHTLY UPHELD THE ACTION OF THE A.O. IN RE OPENING THE ASSESSMENT. THUS, GROUNDS NO.1 & 2 OF THE ASSESSEE ARE DISMISSED. II) AS REGARDS GROUNDS NO. 3 TO 6, THE FACTS ARE I DENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA) HEREINABOVE ON THE TAXABILITY OF THE CAPITAL GAIN. THEREFORE, THE DECISION IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS . ITO (SUPRA) IS IDENTICALLY APPLICABLE IN THE PRESENT CASE. THEREFO RE, GROUNDS NO. 3 TO 6 ARE DISMISSED. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 147 III) GROUNDS NO. 7 TO 11 ARE GENERAL IN NATURE AND THEREFORE, DO NOT REQUIRE ANY ADJUDICATION . IV) IN THE RESULT, THE APPEAL IN ITA NO.180(ASR)/2 011 IS DISMISSED. 2. ITA NO. 475(ASR)/2012 SH.MOHAL LAL SHARMA THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPE AL ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUG HLY BEEN DISCUSSED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORD ER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENT ICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), T HEREFORE, THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS W HICH HAVE BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN TH E FACTS AND CIRCUMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN I TA NO.475(ASR)/2012 ARE DISMISSED. 3. ITA NO.564(ASR)/2011 SH.SARWAN SINGH PHILLAUR THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPE AL ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUG HLY BEEN DISCUSSED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORD ER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENT ICAL TO THE FACTS IN THE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 148 CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), T HEREFORE, THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS W HICH HAVE BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN TH E FACTS AND CIRCUMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN I TA NO.564(ASR)/2011 ARE DISMISSED. 4. ITA NO.472(ASR)/2011 SH. KANWALJIT SINGH LALLY THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.472(ASR)/2011 ARE DISMISSED. 5. ITA NO.13(ASR)/2013 SH. RAGHUNATH PURI (DECD.) THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 149 ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.13(ASR)/2013 ARE DISMISSED. 6. ITA NO.187(ASR)/2012 SMT. RAJWINDER KAUR BHULLAR THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.187(ASR)/2012 ARE DISMISSED. 7. ITA NO.480(ASR)/2012 SH. RANJIT SINGH BRAHAMPURA ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 150 THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.480(ASR)/2012 ARE DISMISSED. 8. ITA NO.08(ASR)/2013 SH. JAGDISH SAWHNEY THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 151 ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.08(ASR)/2013 ARE DISMISSED. 9. ITA NO.466(ASR)/2012 SH. JAGDISH SAWHNEY THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.466(ASR)/2012 ARE DISMISSED. 10. ITA NO.63(ASR)/2013 SH. SATYA PAL SAINI THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 152 IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.63(ASR)/2013 ARE DISMISSED. 11. ITA NO.33(ASR)/2013 DR.RATTAN SINGH THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.33(ASR)/2013 ARE DISMISSED. 12. ITA NO.34(ASR)/2013 DR.BALDEV CHAWLA THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 153 THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.34(ASR)/2013 ARE DISMISSED. 13. ITA NO.162(ASR)/2013 SH. TIKSHAN SUD THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.162(ASR)/2013 ARE DISMISSED. 14. ITA NO.277(ASR)/2013 SH. AJIT SINGH KHOKHAR THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 154 ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.277(ASR)/2013 ARE DISMISSED. 15. ITA NO.338(ASR)/2013 SH. BALWINDER SINGH DHILLON THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.338(ASR)/2013 ARE DISMISSED. 16. ITA NO.244(ASR)/2011 SH. BALBIR SINGH MIANI ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 155 THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.244(ASR)/2011 ARE DISMISSED. 17. ITA NO.485(ASR)/2012(ASSESSEE) AND ITA NO.37(ASR)/2 013 (REVENUE) SH. VIR SINGH LOPOKE THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 156 ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.485(ASR)/2012 ARE DISMISSED AND THAT OF THE REVENUE ARE ALLOWED. 18. ITO VS. SH.VIR SIGH LOPOKE THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.37(ASR)/2013 ARE DISMISSED. 19. ITA NO.15(ASR)/2013 S. SEWA SINGH SEKHWAN THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 157 SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.5(ASR)/2013 ARE D ISMISSED. 20. ITA NO.51(ASR)/2013 SH. AJIT PAL SINGH THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.51(ASR)/2013 ARE DISMISSED. 21. ITA NO.52(ASR)/2013 SH. SIMRANJIT SINGH THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 158 CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.52(ASR)/2013 ARE DISMISSED. 22. ITA NO.56(ASR)/2013 SMT. SATINDER KAUR THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.56(ASR)/2013 ARE DISMISSED. 23. ITA NO.58(ASR)/2013 CAPT. BALBIR SINGH BATH ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 159 THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.58(ASR)/2013 ARE DISMISSED. 24. ITA NO.186(ASR)/2013 SH. SWARAN SINGH CHAUDHARY THE FACTS IN THE GROUNDS TAKEN IN THE PRESENT APPEA L ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), WHERE ALL THE PRESENT ISSUES HAVE THOROUGHLY BEEN DISCUS SED AND ITAT CHANDIGARH BENCH HAS PASSED A DETAILED ORDER IN THE SAID CASE. SINCE THE FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPRA), THEREFORE , THE ORDER THEREIN IS IDENTICALLY APPLICABLE TO THE GROUNDS WHICH HAV E BEEN DISCUSSED IN THE ORDER OF SH.CHARANJIT SINGH ATWAL VS. ITO (SUPR A) AND ALSO IN OUR ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 160 ORDER HEREINABOVE. THEREFORE, IN THE FACTS AND CIRC UMSTANCES, ALL THE GROUNDS OF THE ASSESSEE IN ITA NO.186(ASR)/2013 ARE DISMISSED. 39. IN THE RESULT ITA NO. APPEAL BY RESULT 180(ASR)/203 SH.SATNAM SINGH KAITH DISMISSED 475(ASR)/2012 SH.MOHAN LAL SHARMA DISMISSED 564(ASR)/2011 SH.SARWAN SINGH PHILLAUR DISMISSED 472(ASR)/2011 SH.KANWAJIT SINGH LALLY DISMISSED 13(ASR)/2013 SH.RAGHUNATH PURI (DECD.) DISMISSED 187(ASR)/2012 SMT. BALWINDER KAUR BHULLAR DISMISSED 480(ASR)/2012 SH.RANJIT SINGH BRAHAMPURA DISMISSED 08(ASR)/2013 SH.JAGDISH SAWHNEY DISMISSED 466(ASR)/2012 SH.JAGDISH SAWHNEY DISMISSED 33(ASR)/2013 DR.RATTAN SINGH DISMISSED 34(ASR)/2013 DR.BALDEV RAJ CHAWLA DISMISSED 162(ASR)/2013 SH. TIKSHAN SUD DISMISSED 277(ASR)/2013 SH. AJIT SINGH KHOKHAR DISMISSED 338(ASR)/2013 SH.BALWINDER SINGH DHILLON DISMISSED 244(ASR)/2011 SH.BALBIR SINGH MIANI DISMISSED ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 161 485(ASR)/2012 SH.VIR SINGH LOPOKE DISMISSED 37(ASR)/2013 ITO VS. VIR SINGH LOPOKE ALLOWED 15(ASR)/2013 SH.SEWA SINGH SEKHWAN DISMISSED 51(ASR)/2013 SH.AJIT PAL SINGH DISMISSED 52(ASR)/2013 SH.SIMRANJIT SINGH DISMISSED 56(ASR)/2012 SMT. SATINDER KAUR DISMISSED 58(ASR)/2013 CAPT. BALBIR SINGH BATH DISMISSED 186(ASR)/2013 SH.SWRANB RAM CHAUDHARY DISMISSED 63(ASR)/2013 SH.SATYA PAL SAINI DISMISSED ORDER PRONOUNCED IN THE OPEN COURT ON 19TH AUGUST, 2013. SD/- SD/- (H.S. SIDHU) (B.P. JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 19TH AUGUST, 2013 /SKR/ COPY OF THE ORDER FORWARDED TO: 1. ALL THE ASSESSEES: 2. THE ITO 3. THE CIT(A) 4. THE CIT 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER (ASSISTANT REGISTRAR) INCOME TAX APPELLATE TRIBUNAL, AMRITSAR BENCH: AMRITSAR. ITA NO.180(ASR)/.2013 AND OTHERS ( 24 APPEALS) 162