Sh. Gulshan Kumar Bakshi, Yamunanagar V. ITO, Yamunanagar

ITA 526/CHANDI/2014

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 1576 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 4 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-09-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Next Hearing Date: 17-09-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 20-05-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: MINKY MITTAL
• Keywords: Capital asset
• Section: 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.526/CHD/2014 (ASSESSMENT YEAR : 2009-10) SH.GULSHAN KUMAR BAKSHI, VS. THE INCOME TAX OFFICER, #707, SARASWATI MOHALLA, WARD 3, VPO MUSTAFABAD, YAMUNANAGAR. DISTT. YAMUNANAGAR. PAN: AGRPB5157G (APPELLANT) (RESPONDENT) APPELLANT BY : MS. MINKY MITTAL RESPONDENT BY : SHRI JITENDER KUMAR, DR DATE OF HEARING : 17.09.2015 DATE OF PRONOUNCEMENT : 22.09.2015 O R D E R PER RANO JAIN, A.M . : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS), PANCHKULA DATED 20.12.2012 FOR ASSESSMEN T YEAR 2009-10. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE SOLD HOUSE NO.4840, SANT PURA, MODEL TOWN, YAMUNA NAGAR FOR TOTAL CONSIDERATION OF RS.36,80,000/- VIDE REGISTER ED SALE DEED NO.56836 DATED 20.1.2009. THIS HOUSE WAS PURCHASED BY THE ASSESSEE FOR RS.9 LACS VIDE SALE DEED NO.2905 DATED .8.9.2008 2 THIS REGISTERED SALE DEED WAS MADE IN COMPLIANCE TO THE JUDGMENT AND DECREE DATED 10.4.2008 IN FAVOUR OF TH E ASSESSEE PASSED BY THE COURT. THE ASSESSEE HAD ENT ERED INTO AN AGREEMENT TO SELL FOR PURCHASE OF THE SAID PROPE RTY AS ON 26.3.2003. HOWEVER, SINCE THE BUYER HAD NOT DONE H IS PART OF THE CONTRACT, THE ASSESSEE HAD FILED A SUIT FOR SPE CIFIC PERFORMANCE OF THE AGREEMENT, AS ON 16.3.2006. IN PURSUANCE OF THE SAID SUIT FILED, THE JUDGMENT OF THE COURT W AS DELIVERED AS ON 10.4.2008. THOUGH THE PROPERTY WAS SOLD DURI NG THE YEAR UNDER CONSIDERATION, THE ASSESSEE DID NOT DECL ARE ANY CAPITAL GAIN ARISING OUT OF IT. AN OBJECTION WAS RAISED BY THE ASSESSING OFFICER IN THIS REGARD. THE REPLY OF THE ASSESSEE WAS THAT SINCE THE CHILDREN OF THE SELLER OF THE SA ID PROPERTY HAD FILED A PLAINT IN THE COURT OF CIVIL JUDGE IN R ESPECT OF THE SAID PROPERTY, LITIGATION IS STILL GOING ON. THERE FORE, THE ASSESSEE WAS NOT SURE OF THE CAPITAL GAIN AND NOT S HOWN THE SAME IN HIS COMPUTATION OF INCOME. REJECTING THE SAID PLEA OF THE ASSESSEE THE ASSESSING OFFICER FORMED A VIEW THAT THE TRANSACTION HAS SURELY RESULTED IN SHORT TERM CAPIT AL GAIN. AS THE PURCHASE PRICE OF PROPERTY INCLUDING THE STAMP DUTY WAS RS.9,63,000/-, THE SALE PRICE BEING RS.36,80,000/-, AN AMOUNT OF RS.27,17,000/- WAS TREATED AS SHORT TERM CAPITAL GAIN. FOR TREATING THE SAID TRANSACTION RESULTING IN SHORT TERM CAPITAL GAIN, THE ASSESSING OFFICER TOOK THE DATE O N WHICH THE SUIT FOR SPECIFIC PERFORMANCE WAS FILED I.E. 16.3.2 006, AS THE DATE OF ACQUISITION. 3 3. AGGRIEVED BY THE SAID ORDER OF THE ASSESSING OF FICER, THE ASSESSEE WENT IN APPEAL BEFORE THE LEARNED CIT (APPEALS). BEFORE THE LEARNED CIT (APPEALS), DETAILED SUBMISSI ONS WERE MADE AND IT WAS PRAYED THAT THE ASSESSEE HAD GOOD R EASONS FOR NOT SHOWING THE CAPITAL GAIN IN ITS RETURN OF I NCOME. THE LEARNED CIT (APPEALS) REJECTED THE CONTENTION OF TH E ASSESSEE AND CONFIRMED THE ADDITION MADE BY THE ASSESSING OF FICER. 4. AGGRIEVED BY THE SAID ORDER OF THE LEARNED CIT (APPEALS), THE ASSESSEE HAS COME UP IN APPEAL BY RA ISING THE FOLLOWING GROUNDS OF APPEAL : 1. THAT THE IMPUGNED ORDER IS AGAINST FACTS AND LA W AND WITHOUT JURISDICTION. 2. THAT THE WORTHY COMMISSIONER OF INCOME TAX(A) H AS ERRED IN CONFIRMING THE ADDITION OF RS. 27,17,000/- APPRECIATING TH E FACTS AND WRITTEN-SUBMISSIONS MADE DURING THE ASSESSMENT PROC EEDINGS THAT LITIGATION WAS PENDING IN THE COURT REGARDING PHYSI CAL POSSESSION /OWNERSHIP OF THE PROPERTY. 3. THAT THE LD. WORTHY COMMISSIONER OF INCOME TAX(A) H AS ERRED IN SUSTAINING THE ASSESSED INCOME AT RS. 28,27,350 /- AS AGAINST THE GENUINE RETURNED INCOME AT RS.1,10,350/-. 4. THAT THE APPELLANT CRAVES LEAVE TO AMEND, ALTER OR ADD TO ABOVE GROUNDS OF APPEAL, BEFORE THE APPEAL IS HEARD AND DISPOSED OFF . 5. THE IMPUGNED ORDER IS AGAINST FACTS AND LAW, UNJUST A ND UNFAIR. THE ADDITIONS MADE BY LD. AO AND SUSTAINED BY WORTHY C1 T(A) MAY KINDLY BE DELETED. 4 5. THE LEARNED COUNSEL FOR THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER AS WE LL AS THE LEARNED CIT (APPEALS) AND IN THE ALTERNATIVE, IT WA S ARGUED THAT THE CAPITAL GAIN ARISING OUT OF THE SAID TRANS ACTION SHOULD BE TREATED AS LONG TERM CAPITAL GAIN IN PLAC E OF SHORT TERM CAPITAL GAIN TREATED BY THE ASSESSING OFFICER. THE ARGUMENT OF THE LEARNED COUNSEL FOR THE ASSESSEE WA S THAT SINCE THE AGREEMENT TO SELL OF THE SAID PROPERTY WA S MADE AS ON 26.3.2003, THE ASSET HAS BEEN HELD FOR MORE THAN 36 MONTHS. THEREFORE, THE CAPITAL GAIN SHOULD BE TREA TED AS LONG TERM CAPITAL GAIN. IT WAS FURTHER ARGUED THAT THE ACTION OF THE ASSESSING OFFICER IN TREATING THE DATE OF FILIN G OF SUIT FOR SPECIFIC PURPOSE I.E. 16.3.2006 TO BE THE DATE OF A CQUISITION OF PROPERTY AND HENCE, HOLDING THE GAIN AS SHORT TERM CAPITAL GAIN IS NOT CORRECT. SHE ALSO PLACED RELIANCE ON THE JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF SANJEE V LAL ETC. VS. CIT, 365 ITR 389 (SC) 6. THE LEARNED D.R. RELIED UPON THE ORDER OF THE ASSESSING OFFICER AS WELL THE LEARNED CIT (APPEALS) . HIS PRAYER WAS THAT SINCE ON 26.3.2003 THE ASSESSEE HAD ONLY ENTERED INTO AN AGREEMENT TO SELL, HE DOES NOT BECO ME THE OWNER OF THE PROPERTY ON THAT DATE. AS THE ASSESSE E HAD FILED SUIT FOR SPECIFIC PURPOSE AS ON 16.3.2006, THAT DAT E SHOULD BE TAKEN AS THE DATE FOR ACQUISITION OF ASSET AND SINC E THE SALE HAS BEEN MADE ON 20.1.2009, THE ASSET HAS BEEN HELD BY THE ASSESSEE FOR NOT MORE THAN 36 MONTHS. THEREFORE, T HE 5 TRANSACTION SHOULD BE TREATED AS THAT OF SHORT TERM CAPITAL GAIN. 7. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE UNDISPUTED FACT S OF THE CASE ARE THAT THE ASSESSEE HAD ENTERED INTO AN AGRE EMENT TO SELL FOR PURCHASE OF HOUSE NO.4840, SANT PURA, MODE L TOWN, YAMUNA NAGAR FOR A TOTAL CONSIDERATION OF RS.9 LACS AS ON 26.3.2003 FROM ONE SHRI VINOD KUMAR CHOPRA. THE TO TAL SALE CONSIDERATION WAS PAID AT THE TIME OF AGREEMENT TO SELL ONLY. SINCE THE SELLER FAILED TO FULFILL HIS PART OF CONT RACT, THE ASSESSEE FILED A SUIT FOR POSSESSION BY WAY OF SPEC IFIC PERFORMANCE DATED 16.3.2006. A JUDGMENT AND DECRE E IN FAVOUR OF THE ASSESSEE WAS PASSED AS ON 10.4.2008 B Y THE COURT. IN PURSUANCE OF THE SAID JUDGMENT THE HOUS E GOT REGISTERED VIDE SALE DEED NO.2905, DATED 8.9.2008. THEREAFTER, DURING THE RELEVANT ASSESSMENT YEAR, AS ON 20.1.2009, THE ASSESSEE SOLD THE SAID PROPERTY BY R EGISTERED SALE DEED FOR A CONSIDERATION OF RS.36,80,000/-. T HE ASSESSEE HAD NOT OFFERED TO TAX THE CAPITAL GAIN ARISING OUT OF THIS TRANSACTION ON THE PRETEXT SINCE THE CHILDREN OF TH E SELLER HAD FILED SUIT AGAINST THE ASSESSEE, THE LITIGATION STI LL GOING ON, THE HOUSE IS IN DISPUTE. HOWEVER, BEFORE US THE LI MITED QUESTION IS WHETHER THE CAPITAL GAIN ARISING FROM T HE SAID TRANSACTION DURING THE RELEVANT ASSESSMENT YEAR IS LONG TERM CAPITAL GAIN OR SHORT TERM CAPITAL GAIN, AS THE TRA NSACTION HAS SURELY RESULTED IN CAPITAL GAIN DURING THE RELE VANT ASSESSMENT YEAR AND NO ARGUMENTS AGAINST THIS FACT WERE MADE BY 6 THE LEARNED COUNSEL FOR THE ASSESSEE DURING THE COU RSE OF HEARING BEFORE US. 8. THE IMPORTANT DATES, RELEVANT TO DECIDE THE IS SUE IN QUESTION ARE AS FOLLOWS : PURCHASE TRANSACTION AGREEMENT TO SELL 26.3.2003 SUIT FOR SPECIFIC PERFORMANCE 16.3.2006 JUDGEMENT DECREE FOR SPECIFIC PERFORMANCE 10.4.2008 SALE DEED REGISTERED 8.9.2008 SALE TRANSACTION SALE DEED REGISTERED 20.1.2009 9. THE ONLY DISPUTE IS WITH REGARD TO THE DATE OF ACQUISITION TO BE CONSIDERED FOR DECIDING WHETHER T HE TRANSACTION IS THAT OF LONG TERM CAPITAL GAIN OR SH ORT TERM CAPITAL GAIN, AS THE DATE OF ULTIMATE SALE IS NOT I N DISPUTE. THE ASSESSING OFFICER HAS TAKEN THE DATE OF FILING OF SUIT FOR SPECIFIC PERFORMANCE, I.E. 16.3.2006 AS THE DATE OF ACQUISITION, WHILE THE CONTENTION OF THE ASSESSEE IS THAT IT SHO ULD BE TAKEN AS THE DATE OF AGREEMENT TO SELL I.E. 26.3.2003. 10. AS PER SECTION 2(42A) OF THE ACT, AN ASSET IS SAID TOBE A SHORT TERM ASSET IF IT IS HELD BY THE ASSESS EE FOR NOT MORE THAN 36 MONTHS. IN OUR VIEW, THE WORDS HELD BY THE ASSESSEE DOES NOT MEAN VESTING OF THE LEGAL TITLE TO THE PROPERTY IN ASSESSEE. THE ASSESSEE HAS ENTERED IN TO AN AGREEMENT TO SELL AS ON 26.3.2003, HE HAS EVEN PAR TED WITH 7 THE WHOLE PURCHASE CONSIDERATION, HE IS WILLING TO GET THE PROPERTY REGISTERED IN HIS NAME ALSO. HOWEVER, SIN CE THE SELLER DID NOT PERFORM HIS PART OF THE CONTRACT, HE FILED A SUIT FOR SPECIFIC PERFORMANCE. IN THESE CIRCUMSTANCES, IT CANNOT BE SAID THAT THE ASSET WAS NOT BEING HELD BY THE A SSESSEE. FOR THE HOLDING OF AN ASSET, THE ASSESSEE NEED NOT NECESSARILY BE THE OWNER OF THE ASSET, WITH A REGISTERED CONVEY ANCE DEED. THE VIEW OF THE ASSESSING OFFICER, ALSO UPHELD BY T HE CIT (APPEALS) THAT THE DATE ON WHICH THE SUIT FOR POSSE SSION BY WAY OF SPECIFIC PERFORMANCE OF CONTRACT WAS INSTITU TED, I.E. 16.3.2006, IS TO BE TREATED AS DATE OF ACQUISITION, DOES NOT SEEM SOUND TO US. IN NORMAL CIRCUMSTANCES, BY EXE CUTING AN AGREEMENT TO SELL, A RIGHT IN PERSONAM IS CRATED IN FAVOUR OF THE BUYER. ONCE SUCH RIGHT IS CREATED, THE SELLER IS RESTRAINED FROM SELLING THE SAID PROPERTY TO SOMEONE ELSE. THUS, IT IS QUITE CLEAR THAT EVEN THE EFFECTS OF SE CTION 2(47) OF THE ACT, WHICH DEFINE THE TERM TRANSFER, ARE THAT WHEN ANY RIGHT IN RESPECT OF ANY ASSET IS EXTINGUISHED AND T RANSFERRED TO SOMEONE ELSE, IT HAS TO BE CONSIDERED AS TRANSFE R OF THE CAPITAL ASSET. THE RELIANCE PLACED BY THE LEARNED COUNSEL FOR THE ASSESSEE ON THE JUDGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF SHRI SANJEEV LAL ETC. VS. CIT, 365 ITR 389 (SC) IS NOT OUT OF PLACE. IN THIS CASE ALSO, THE ISSUE WAS WHETHER THE DATE OF AGREEMENT TO SELL CAN BE CONSIDERED AS THE DATE ON WHICH THE ASSET GOT TRANSFERRED. AFTER ANALYZING A LL THE PROVISIONS OF THE ACT IN THIS REGARD, THE HON'BLE A PEX COURT, HELD AS UNDER : 8 21. NOW IN THE LIGHT OF DEFINITION OF 'TRANSFER' AS D EFINED UNDER SECTION 2(47) OF THE ACT, IT IS CLEAR THAT WHEN ANY RI GHT IN RESPECT OF ANY CAPITAL ASSET IS EXTINGUISHED AND THAT RIGHT IS TRANSFERRED TO SOMEONE, IT WOULD AMOUNT TO TRANSFER OF A CAPITAL A SSET. IN THE LIGHT OF THE AFORESTATED DEFINITION, LET US LOOK AT THE FACTS OF THE PRESENT CASE WHERE AN AGREEMENT TO SELL IN RESPECT O F A CAPITAL ASSET HAD BEEN EXECUTED ON 27TH DECEMBER, 2002 FOR T RANSFERRING THE RESIDENTIAL HOUSE/ORIGINAL ASSET IN QUESTION AND A SUM OF RS. 15 LAKHS HAD BEEN RECEIVED BY WAY OF EARNEST MONEY. IT I S ALSO NOT IN DISPUTE THAT THE SALE DEED COULD NOT BE EXECUTED BEC AUSE OF PENDENCY OF THE LITIGATION BETWEEN SHRI RANJEET LAI O N ONE HAND AND THE APPELLANTS ON THE OTHER AS SHRI RANJEET LAI HAD CHALLENGED THE VALIDITY OF THE WILL UNDER WHICH THE PROPERTY HAD DEVOLVED UPON THE APPELLANTS. BY VIRTUE OF AN ORDER PASSED IN THE SU IT FILED BY SHRI RANJEET LAI, THE APPELLANTS WERE RESTRAINED FROM DEAL ING WITH THE SAID RESIDENTIAL HOUSE AND A LAW-ABIDING CITIZEN CAN NOT BE EXPECTED TO VIOLATE THE DIRECTION OF A COURT BY EXECUTING A SALE DEED IN FAVOUR OF A THIRD PARTY WHILE BEING RESTRAINED FROM DOING SO . IN THE CIRCUMSTANCES, FOR A JUSTIFIABLE REASON, WHICH WAS NOT WITHIN THE CONTROL OF THE APPELLANTS, THEY COULD NOT EXECUTE THE SA LE DEED AND THE SALE DEED HAD BEEN REGISTERED ONLY ON 24TH SEPTEM BER, 2004, AFTER THE SUIT FILED BY SHRI RANJEET LAI, CHALLENGI NG THE VALIDITY OF THE WILL, HAD BEEN DISMISSED. IN THE LIGHT OF THE AFORESTATED FACTS AND IN VIEW OF THE DEFINITION OF THE TERM 'TRANSF ER', ONE CAN COME TO A CONCLUSION THAT SOME RIGHT IN RESPECT OF THE CA PITAL ASSET IN QUESTION HAD BEEN TRANSFERRED IN FAVOUR OF THE VEND EE AND THEREFORE, SOME RIGHT WHICH THE APPELLANTS HAD, IN RES PECT OF THE CAPITAL ASSET IN QUESTION, HAD BEEN EXTINGUISHED BE CAUSE AFTER EXECUTION OF THE AGREEMENT TO SELL IT WAS NOT OPEN TO T HE APPELLANTS TO SELL THE PROPERTY TO SOMEONE ELSE IN ACCORDANCE WIT H LAW. A RIGHT IN PERSONAM HAD BEEN CREATED IN FAVOUR OF THE VENDEE, I N WHOSE FAVOUR THE AGREEMENT TO SELL HAD BEEN EXECUTED AND WH O HAD ALSO PAID RS.15 LAKHS BY WAY OF EARNEST MONEY. NO DOUBT, SUCH CONTRACTUAL RIGHT CAN BE SURRENDERED OR NEUTRALIZED BY THE PARTIES THROUGH SUBSEQUENT CONTRACT OR CONDUCT LEADING TO N O TRANSFER OF THE PROPERTY TO THE PROPOSED VENDEE BUT THAT IS NOT THE CASE AT HAND. 9 22. IN ADDITION TO THE FACT THAT THE TERM 'TRANSFER' HAS BEEN DEFINED UNDER SECTION 2(47) OF THE ACT, EVEN IF LOOKED AT THE PROVISIONS OF SECTION 54 OF THE ACT WHICH GIVES RELIEF TO A PERSON W HO HAS TRANSFERRED HIS ONE RESIDENTIAL HOUSE AND IS PURCHAS ING ANOTHER RESIDENTIAL HOUSE EITHER BEFORE ONE YEAR OF THE TRAN SFER OR EVEN TWO YEARS AFTER THE TRANSFER, THE INTENTION OF THE LEGIS LATURE IS TO GIVE HIM RELIEF IN THE MATTER OF PAYMENT OF TAX ON THE L ONG TERM CAPITAL GAIN. IF A PERSON, WHO GETS SOME EXCESS AMO UNT UPON TRANSFER OF HIS OLD RESIDENTIAL PREMISES AND THEREAFT ER PURCHASES OR CONSTRUCTS A NEW PREMISES WITHIN THE TIME STIPULAT ED UNDER SECTION 54 OF THE ACT, THE LEGISLATURE DOES NOT WANT HIM TO BE BURDENED WITH TAX ON THE LO NG TERM CAPITAL GAIN AND THEREFORE, RELIEF HAS BEEN GIVEN TO HIM IN RESPECT OF PAYING INCOME TAX ON THE LONG TERM CAPITAL GAIN. TH E INTENTION OF THE LEGISLATURE OR THE PURPOSE WITH WHICH THE SAID PROVISION HAS BEEN INCORPORATED IN THE ACT, IS ALSO VERY CLEAR TH AT THE ASSESSEE SHOULD BE GIVEN SOME RELIEF. THOUGH IT HAS BE EN VERY OFTEN SAID THAT COMMON SENSE IS A STRANGER AND AN I NCOMPATIBLE PARTNER TO THE INCOME TAX ACT AND IT IS ALSO SAID THAT EQUITY AND TAX ARE STRANGERS TO EACH OTHE R, STILL THIS COURT HAS OFTEN OBSERVED THAT PURPOSIVE INTERPRETAT ION SHOULD BE GIVEN TO THE PROVISIONS OF THE ACT. IN THE CASE OF OXFORD UNIVERSITY PRESS V. COMMISSIONER OF INCOME TAX [(2001) 3 SCC 359] THIS COURT HAS OBSERVED THAT A PURPOSIVE I NTERPRETATION OF THE PROVISIONS OF THE ACT SHOULD BE GIVEN WHILE CONSIDERING A CLAIM FOR EXEMPTION FROM TAX. IT HAS ALSO BEEN SAID THAT HARMONIOUS CONSTRUCTION OF THE PROVISIONS WHICH SUBS ERVE THE OBJECT AND PURPOSE SHOULD ALSO BE MADE WHILE CONSTRUING A NY OF THE PROVISIONS OF THE ACT AND MORE PARTICULARLY WHEN ON E IS CONCERNED WITH EXEMPTION FROM PAYMENT OF TAX. CONS IDERING THE AFORESTATED OBSERVATIONS AND THE PRINCIPLES WITH REGARD TO THE INTERPRETATION OF STATUTE PERTAINING TO THE TAX LAWS, ONE CAN VERY WELL INTERPRET THE PROVISIONS OF SECTION 54 READ WITH SECTION 2(47) OF THE ACT, I.E. DEFINITION OF 'TRANSFER', WHICH WOU LD ENABLE THE APPELLANTS TO GET THE BENEFIT UNDER SECTION 54 OF THE ACT. 10 23. CONSEQUENCES OF EXECUTION OF THE AGREEMENT TO SELL A RE ALSO VERY CLEAR AND THEY ARE TO THE EFFECT THAT THE APPE LLANTS COULD NOT HAVE SOLD THE PROPERTY TO SOMEONE ELSE. IN PRACTICAL LI FE, THERE ARE EVENTS WHEN A PERSON, EVEN AFTER EXECUTING AN AGREE MENT TO SELL AN IMMOVEABLE PROPERTY IN FAVOUR OF ONE PERSON, TRIES TO SELL THE PROPERTY TO ANOTHER. IN OUR OPINION, SUCH AN ACT WOU LD NOT BE IN ACCORDANCE WITH LAW BECAUSE ONCE AN AGREEMENT TO SELL IS EXECUTED IN FAVOUR OF ONE PERSON, THE SAID PERSON GETS A RIGH T TO GET THE PROPERTY TRANSFERRED IN HIS FAVOUR BY FILING A SUIT FO R SPECIFIC PERFORMANCE AND THEREFORE, WITHOUT HESITATION WE CAN SAY THAT SOME RIGHT, IN RESPECT OF THE SAID PROPERTY, BELONGING TO THE APPELLANTS HAD BEEN EXTINGUISHED AND SOME RIGHT HAD BEEN CREATED IN FAVOUR OF THE VENDEE/TRANSFEREE, WHEN THE AGREEMENT TO SELL HAD BEEN EXECUTED. 24. THUS, A RIGHT IN RESPECT OF THE CAPITAL ASSET, VIZ. THE PROPERTY IN QUESTION HAD BEEN TRANSFERRED BY THE APPELLANTS IN FA VOUR OF THE VENDEE/TRANSFEREE ON 27TH DECEMBER, 2002. THE SALE DEE D COULD NOT BE EXECUTED FOR THE REASON THAT THE APPELLANTS HAD BEEN PREVENTED FROM DEALING WITH THE RESIDENTIAL HOUSE BY AN ORDER OF A COMPETENT COURT, WHICH THEY COULD NOT HAVE VIOLATED. 25. IN VIEW OF THE AFORESTATED PECULIAR FACTS OF THE CASE AND LOOKING AT THE DEFINITION OF THE TERM 'TRANSFER' AS D EFINED UNDER SECTION 2(47) OF THE ACT, WE ARE OF THE VIEW THAT THE APPELLANTS WERE ENTITLED TO RELIEF UNDER SECTION 54 OF THE ACT I N RESPECT OF THE LONG TERM CAPITAL GAIN WHICH THEY HAD EARNED IN PURSUA NCE OF TRANSFER OF THEIR RESIDENTIAL PROPERTY BEING HOUSE NO. 267, SECTOR 9-C, SITUATED IN CHANDIGARH AND USED FOR PUR CHASE OF A NEW ASSET/RESIDENTIAL HOUSE. 11. RESPECTFULLY FOLLOWING THE PROPOSITION LAID DO WN BY THE HON'BLE APEX COURT, WE HOLD THAT THE DATE OF AC QUISITION IN THIS CASE HAS TO BE TAKEN AS THE DATE OF AGREEME NT TO SELL I.E. 26.3.2003, SINCE THE ASSET IS SOLD ON 20.1.200 9, THE SAME 11 HAS BEEN HELD TO BE LONG TERM CAPITAL ASSET AND THE GAIN ARISING OUT OF THE SAID TRANSACTION IS HELD TO BE L ONG TERM CAPITAL GAIN. 12. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS P ARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 22 ND DAY OF SEPTEMBER, 2015. SD/- SD/- (BHAVNESH SAINI) (RANO JAIN) JUDICIAL MEMBER ACOUNTANT MEMBER DATED : 22 ND SEPTEMBER, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH