VENKAT RAJASEKHAR KONERU,HYDERABAD V. ACIT, CENTRAL CIRCLE-1(1), HYDERABAD

MA 24/HYD/2025

AI Insights

The case involves Shri Venkata Rajasekhar Koneru, who filed a Miscellaneous Application against the Tribunal's earlier decision dismissing his appeal related to the assessment year 2016-2017. The original appeal concerned the taxation of capital gains arising from a development agreement. The Tribunal had previously dismissed the appeal, leading to the filing of the M.A. by the assessee, claiming that the Tribunal had not considered certain Supreme Court decisions relevant to his case. The Tribunal, however, found that the decisions were indeed considered and applied correctly, and thus dismissed the M.A.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 712679 (ITAT-HYDERABAD)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 31-07-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Assessment Year: 2016-2017
• Other Referred Cases: Seshashayee Steels Pvt Ltd Vs ACIT 421 ITR 421 (SC), ACIT Vs Saurashtra Kutch Stock Exchange Ltd 2008 305 ITR 227, Potla Nageswara Rao vs. DCIT [2014] 8-TMI-636-AP-HC, CIT vs. Balbir Singh Maini [2018] 12 SCC 354 (SC), CIT vs. Reliance Telecom Ltd, [2021] 133 taxmann.com 41 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: GURPREET SINGH
• Assessee Lawyers: A. SRINIVAS HYBRID MODE
• Keywords: Capital asset; Capital Gains; Search and seizure

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD “A” BENCH : HYDERABAD BEFORE SHRI MANJUNATHA G, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER M.A.No.24/Hyd./2025 Arising out of ITA.No.627/Hyd/2022 - Assessment Year 2016-2017 Shri Venkata Rajasekhar Koneru, Hyderabad. PAN AHCPK3163F vs. The ACIT, Central Circle-1(1), Hyderabad. (Applicant) (Respondent) For Assessee : CA, A. Srinivas [Hybrid Mode] For Revenue : Sri Gurpreet Singh, Sr. AR Date of Hearing : 25.07.2025 Date of Pronouncement : 31.07.2025 ORDER PER MANJUNATHA G, A.M. : The above Miscellaneous application has been moved by the assessee requesting to rectify the mistakes crept in the common order of the Tribunal dated 22.10.2024 in ITA.No.627/Hyd./2022 by exercising it’s jurisdiction u/sec.254(2) of the Income Tax Act, 1961. Printed from counselvise.com 2 MA.No.24/Hyd./2025 2. CA, A. Srinivas, Learned Counsel for the Assessee has narrated the facts of the case and mistakes stated by the Assessee on record from the common order of the Tribunal dated 22.10.2024 in ITA.No.627/Hyd./2022 for the assessment year 2016-2017. The relevant contents and the grounds taken by the assessee in the M.A. are reproduced as under : 1. I had filed the above appeal before the Hon'ble Tribunal against the order of the Lo CIT(A) Appeals 11. Hyderabad on 11/11/2022 and the same was numbered as ITA No 627/Hy3/2022. 2. The appeal came up for hearing before the Hon'ble Tribunal on 21/10/2024, and the Hon'ble Tribunal vide its order dt.22/10/2024 was pleased to dismiss the appeal. 3. I am an individual lad my retum of income 01.08.2016 admitting an income of Rs.4,01,450/ A search and seizure operation uis 132 has taken place on 26.04 2018 in the case of Allam Raja Reddy of Mis Gandhari Constructions Group. During the course of search a copy of Development Agreement cum GPA dt. 27.06.2015 entered into by me and four others was found Subsequently notice u/s.153C was issued to the assessee on 25.01.2021 and the assessee filed return of income on 06.02.2021, in response to notice u/s 153C, admitting the same income as admitted in the original return i.e., Rs.4,01,450/-. 4. Subsequently, the case was selected for scrutiny and during the course of assessment proceedings. I had submitted that a development agreement cum GPA was executed on 27.06.2015 and registered vide document No.8396/2015, no consideration was received by me en account of execution of Development Agreement. I had also stated that the developer has not yet obtained the Municipal permission for construction of the proposed building. I further stated that none of the conditions mentioned in the development agreement are fulfilled by the Printed from counselvise.com 3 MA.No.24/Hyd./2025 developer. It was also stated that the possession is given only for the limited purpose of development/construction of land and it is not an outright possession but it is licence to construct the proposed project. I also stated that the builder has not obtained permission from Municipal Authorities for the purpose of development of the project During the course of assessment proceedings, the learned Assessing Officer determined the short- term capital gains at Rs.32.14,976/- assuming that the transfer of the property has taken place the moment I had entered into a development agreement. 5. The learned CIT confirmed the order of the Assessing Officer, therefore, I had filed an appeal before the Hon'ble ITAT. Before the Hon'ble ITAT, I had brought to the attention of the Hon'ble Bench, case laws including that of the Supreme Court decision in the case of Mis Sheshasayee Steels Pvt Ltd Vs ACIT 421 ITR 421 (SC). I had along with the other appellants also provided the letter of the HMDA, according to which the technical approval of the project vide letter dt 05.01.2021 was accorded and how I was directed to approach the Commissioner Municipal Bandlaguda, Municipal Corporation R.R.District for release of plans. After this approval only the property was handed over to the developer even though the development agreement was entered on 27.06.2015. 6. The Hon'ble ITAT 'A' Bench, in their order in ITA No.627/Hyd/2022, dt 22.10.2024, heard the case. The AR of one of the other Appellants (Shn Pramod Reddy Tekula), Mr Mohd Afzal brought to the notice of the Bench the decision of the Hon'ble Supreme Court in the case of Seshashayee Steels (P) Ltd Vs ACIT 421 ITR 0046 for consideration, wherein, the transfer of property u/s 2(47) of the IT Act considering the provisions of section 53A of the TP Act was explained The Hon'ble Bench reproduced a part of the order of the Supreme Court in their order. 7. However, while deciding the issue the facts of the Hon'ble Supreme Court are not distinguished with that of the facts of the assessee The Hon'ble Bench has not stated that the facts and circumstances of the case, as to why the rationale of the Supreme Court Judgment was not considered. Non consideration of the rationale of the Supreme Court decision is a mistake apparent from record, therefore, this petition for rectification u/s 254(2) of the IT Act for recalling the order of the Hon'ble ITAT in ITA No. 627/Hyd/2022, dt. 22 10.2024, for appropriate action Printed from counselvise.com 4 MA.No.24/Hyd./2025 8. The Hon'ble Supreme Court in the case of ACIT Vs Saurashtra Kutch Stock Exchange Ltd 2008 305 ITR 227, held that non consideration of a decision of Jurisdictional High Court or Supreme Court can be said to be a mistake apparent from record, which can be rectified u/s 254(2) of the IT Act. Therefore, the Hon'ble Bench is requested to apply the rationale of the Hon'ble Supreme Court in the case of assessee, in respect of taxation of capital gains in the financial year in which the Development Agreement is entered and the Developer has not adhered to the any of the clauses of the Development agreement. 9. As the case laws cited were not distinguished, and the decision based on the said case laws suffers from Infirmity, which is apparent from record, it is prayed that Hon'ble Tribunal may be pleased to recall or amend its order dated 22.10.2024 and decide the appeal accordingly.” 2.1. Learned Counsel for the Assessee further stated that, the Tribunal has passed common order in the case of applicant-assessee herein and Sri Bandi Sudheer Reddy and Sri Pramod Reddy and on identical findings all three appeals have been dismissed. Sri Bandi Sudheer Reddy and Sri Pramod Reddy have filed Miscellaneous Applications and the same has been dismissed by the Tribunal. Therefore, on similar reasoning, this Miscellaneous Application needs to be dismissed. However, he further stated that, since the applicant-assessee has already offered the capital gain tax for the assessment year 2021-2022 and brought to tax, whatever tax paid in the assessment year 2021-2022 may Printed from counselvise.com 5 MA.No.24/Hyd./2025 be directed to be refunded to the assessee or adjusted in other tax liability. 3. Sri Gurpreet Singh, learned Sr. AR for the Revenue, on the other hand, strongly relied on the common order of the Tribunal dated 22.10.2024 passed in ITA.No.627/Hyd./ 2024. He submitted that, the assessee seeks to review the orders of the Tribunal dated 22.10.2024 under the garb of rectification and that, the Tribunal has no power to review it’s own order in light of decisions of Hon’ble Supreme Court in the case of ACIT vs., Sourashtra Kutch Stock Exchange Ltd., [2008] 305 ITR 227 (SC). He, accordingly submitted that, there are no merits in the M.A. filed by the assessee and, therefore, the M.A. filed by the assessee deserves to be dismissed. Learned DR further stated that, the other argument of the Learned Counsel for the Assessee to adjust the tax refund for any other assessment year cannot be considered as the assessment year involved before the Tribunal is assessment year 2016- 2017 and whereas the tax refund/adjustment is for the Printed from counselvise.com 6 MA.No.24/Hyd./2025 assessment year 2021-2022. Therefore, the arguments of the assessee cannot be accepted. 4. We have heard both the parties and considered relevant contents of the M.A. filed by the assessee u/sec.254(2) of the Act in light of the common order of the Tribunal dated 22.10.2024 passed in ITA.No.610/Hyd./ 2024 etc., and more particularly, paras 8 to 8.2 where the Tribunal has considered the arguments of the assessee in light of the decision of Hon’ble Supreme Court in the case of M/s. Sheshasayee Steels Pvt. Ltd., vs., ACIT 421 ITR 421 (SC) and after considering relevant facts and also by following decision of the Hon’ble High Court of Andhra Pradesh in the case of Potla Nageswara Rao vs., DCIT [2014] 8-TMI-636-AP-HC held that, the year of taxability of transfer in pursuance to JDA is the year in which such Development Agreement [in short “JD”] cum General Power of Attorney [in short “GPA] is registered. In the present case, going by the facts available on record, since the DA cum GPA was registered on 27.06.2015, the year of taxation would be assessment year 2016-2017. Therefore, in our considered Printed from counselvise.com 7 MA.No.24/Hyd./2025 view, the findings of fact recorded by the Tribunal in the given facts of the case is in accordance with the decision of Hon’ble High Court of Andhra Pradesh in the case of Potla Nageswara Rao vs., DCIT (supra) and the decision of Hon’ble Supreme Court in the case of CIT vs., Balbir Singh Maini [2018] 12 SCC 354 (SC). Further, the Tribunal has also considered the ratio of the Hon’ble Supreme Court in the case of M/s. Sheshasayee Steels Pvt. Ltd., vs., ACIT (supra). Therefore, in our considered view, there is no merit in the application filed by the assessee u/sec.254(2) of the Act to recall the common order of the Tribunal dated 22.10.2024 in ITA.No.627/Hyd./2024. Further, the applicant-assessee fails to make-out a prima facie mistake apparent on record as contemplated u/sec.254(2) of the Act, but, what is canvassed through the present M.A. is to review the order of the Tribunal dated 22.10.2024 in ITA.No.627/Hyd./2024 in the guise of rectification which is not permissible in law in light of decisions of Hon’ble Supreme Court in the case of ACIT vs., Sourashtra Kutch Stock Exchange Ltd., [2008] 305 ITR 227 (SC) and CIT vs., Reliance Telecom Ltd,., [2021] Printed from counselvise.com 8 MA.No.24/Hyd./2025 133 taxmann.com 41 (SC). Thus, we dismiss the M.A. filed by the assessee. 5. Further, we note that, the argument of the Counsel for the Assessee that, capital gains tax were paid for assessment year 2021-2022 and the same needs to be adjusted for any other tax liability or to refund the same to the assessee, in our considered view, the issue before us is the assessment year 2016-2017 and, therefore, we cannot give any finding on the issue for the assessment year 2021- 2022 and thus, the arguments of the Counsel for the Assessee on this issue is rejected. 6. In the result, M.A. of the Assessee is dismissed. Order pronounced in the open court on 31.07.2025. Sd/- Sd/- [RAVISH SOOD] [MANJUNATHA G] JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad, Dated 31st July, 2025 VBP Printed from counselvise.com 9 MA.No.24/Hyd./2025 Copy to 1. Sri Venkata Rajasekhar Koneru, Flat No.302, Gananadha Residency Apartment, Flat No.25, Sundar Nagar, B.K. Guda, Hyderabad – 500 038. Telangana. 2. The ACIT, Central Circle-1(4), Hyderabad. 3. The Pr. CIT (Central), Hyderabad 4. The DR ITAT “A” Bench, Hyderabad. 5. Guard File. //By Order// //True Copy// Printed from counselvise.com "