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TMI Blog1987 (8) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... hich was received in the shape of a post dated cheque was paid finally in 1975 and as per the deed the property was to be deemed to have been transferred only after the payment of this sum, though knowing fully well that the land was already registered in favour of the society in the year 1972 itself. He referred to the sale deed, copy of which has been filed by the assessee and submitted that it clearly provided that the transfer of the said land had taken place in 1972. It is also clearly specified in the sale deed that full consideration had been recovered and by means of note it has been mentioned that in case the amount of Rs. 40,350 is not paid by 30th November, 1972, then in that event the sale deed would be treated as effective only from the day the payment is made. He submitted that the sale deed is dated 7th August 1972 and it was registered with the Sub-Registrar's office on the 13th of September, 1972. He placed reliance on Mulla's Transfer of Property Act, 1973 Edition and submitted that the note regarding payment of Rs. 40,000 is only to accommodate the Society to defer its payment. He placed reliance on Mulla's Transfer of Property Act, pages 303, 304, 305, 330 and 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hysical possession which remained with the assessee till 15th of October, 1975. Therefore, to hold that the transfer was effected on 13th of September, 1972, i.e., the day on which it was registered in favour of the assessee would be wrong on facts of the case. The assessee pleaded that he would have no objection if the proceedings in respect of assessment year 1976-77 are taken for bringing into tax the capital gains, if any. Reliance was also placed on CIT v. Motilal Ramswaroop [1970] 76 ITR 43 (Raj.) wherein it was observed that department cannot question the veracity of a transaction. On the issue of the conditional sale, reliance was placed on Panchoo Sahu v. Janki Mandar AIR 1952 Pat. 263 and also Ghanshyamdas Kishan Chander v. CIT [1980] 121 ITR 121 (AP), Addl. CIT v. Mercury General Corpn. (P.) Ltd. [1982] 133 ITR 525 (Delhi). Reference was also made to the returns of wealth as were filed by the assessee wherein the entire agricultural land was shown as wealth of the assessee and that the amount received as sale consideration was treated as debt due by the assessee. Reference was made to the Rajasthan High Court decision in the case of the assessee taken under the Wealth-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te on the sale deed was that since the balance amount of Rs. 40,350 was paid on 15th of October, 1975, the sale became a valid sale only from that date for which purpose reliance was placed on the Patna High Court decision in Panchoo Sahu's case. The assessee placed reliance on Rajasthan High Court decision in Motilal Ramswaroop's case for the proposition that when the parties to the transaction, namely, the assessee, who is the seller and the society, which is a purchaser, have no dispute to the fact that the sale was treated as valid only on payment of the balance on 15th of October, 1975, the department, which is third party, to the contract, cannot dispute the date of sale and, rather, that the department may not have jurisdiction. 5. Basically, the transfer of an immovable property is governed by section 54 of the Transfer of Property Act. According to this section, a contract for sale of immovable property is a contract that a sale of such property shall take place on terms settled between the parties. The issue that needs to be decided is whether on the basis of the sale deed the intention of the parties was to treat it as a complete sale on the date of agreement or as a co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, 1972 when the property was registered in favour of the Society. While coming to this conclusion that the sale was complete on 13th September, 1972, we are alive to the decision of the Rajasthan High court in the case of Motilal Ramswaroop's case. In this case, the karta of HUF had made large gifts out of the funds of the HUF to which gifts the coparceners had no objection. The Department made a claim that the gift was either void or voidable as it was made without keeping into consideration the interest of the coparceners. On this, there Lordships observed that since the coparceners did not raise any objection to the gift made, it is not for the department to raise a dispute as, it is not a party and that it is definitely not a party which would be affected by such a gift. In the instant case, this particular ruling of the Rajasthan high Court had been relied upon on the basis of the statement of the assessee as well as the affidavit of the President of the society wherein both had categorically stated that the sale was concluded only on 15th of October, 1975, i.e., the date on which the amount of Rs. 40,350 was paid and that possession was given only on that day and, therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uation where certain property was mortgaged for certain debts which was subsequently sold to the mortgagee. The question was whether the sale was complete when the mortgage was made or only when it was sold. The ruling of their Lordships was that the sale took place at a subsequent point of time when the sale was made and not on the day of which the mortgage was effected. The issue before their Lordships of the Delhi High Court was in the absence of sale deed being effected and possession not being given whether it would be right to treat the property as sold on the basis of an agreement entered into by the Company with its shareholders. The ruling of their Lordships was that no sale was effective. These two cases, we are afraid, have no relevance to the issue before us for the reason that in the case before us the sale deed has been registered and on the facts it appears that the possession could also be said to have been given immediately thereafter as there was no evidence regarding any dispute between the assessee and the purchaser for repossession or refund of the amount and also or not acting in the manner specified in the deed. Therefore, we have only to conclude that the sa ..... 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