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TMI Blog2017 (11) TMI 1060X X X X Extracts X X X X X X X X Extracts X X X X ..... on the facts of the case in not appreciating the fact that there has been no transfer of capital asset as per section 2(47)(v) of the Income Tax Act. 4. The learned CIT (Appeal) has erred in law and on the facts of the case in not appreciating the fact that once the capital asset is converted into stock-intrade, provisions of section 2(47)(iv) r . 45(2) of the Income Tax Act were applicable and the capital gain is taxable in the year such stock is sold or transferred." 3. At the outset, it was noted that the captioned appeal has been filed belatedly after a delay of 1406 days. The assessee has sought condonation of delay, and in support, a duly sworn Affidavit dated 22.3.2017 has been placed before the Bench. Further, the learned representative for the assessee has also supported the application by making varied submissions, which I will deal with a little later. Before proceeding to evaluate the reasons for the delay, I find it expedient to briefly touch upon the dispute between the assessee and the Revenue which has resulted in the captioned proceedings before the Tribunal. 4. The appellant is an individual who filed her return of income for the Assessment Year 2009-1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperty. Before the CIT(A), assessee also brought out on the basis of a letter and an Affidavit from her father that the only consideration received is Rs. 60,00,000/-, which has been received Rs. 10,00,000/- each by each of the six co-owners and so far as the allotment of three flats by the builder contained in the Conveyance Deed dated 10.08.2008 was concerned, the same were to go to the assessee's father and his two sons and no flat was to accrue to the assessee. Notwithstanding the aforesaid, the assessee also brought out before the CIT(A) that the only sum she has received is Rs. 10,00,000/-, and that the builder had so far not handed over any flat either to her or to any of her family members, and that there was no likelihood of her receiving any flat inasmuch as even the construction has not been started by the builder. None of the aforesaid assertions have been controverted by the CIT(A). In fact, the CIT(A) allowed the benefit of cost of acquisition for working out the Capital Gains, but upheld the application of Sec. 50C of the Act by the Assessing Officer for the purposes of determining the full value of consideration while computing the Capital Gains. The CIT(A) noted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red before the CIT (Appeals). I contented before the CIT (Appeals) that my consideration was Rs. 10 lakhs and that the capital gain should be computed accordingly. Further, the CIT (Appeals) did not agree with my contention that there has been no transfer of capital asset as per section 2(47)(v) of the Income Tax Act since the builder had not yet commenced construction of the building due to non availability of access to the property . (5) That after the receipt of the CIT (Appeals) order dated 28-02-2013 I consulted the assessing officer as well as some professionals who advised me that my case was weak and I would not get any relief from the Tribunal. As such I did not file the appeal in time. (6) That out of income tax demand of Rs. 7,82,048/- , I have already paid Rs. 4 lakhs approximately due to pressure from the Income Tax department and I do not have resources to make any further payment. My family is a lower middle class family, my father has retired and my brother is a bus driver with BEST. (7) That the income tax assessment of my other family members were completed in March, 2015 by reopening the cases and similar additions were made. That I came to know from my ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n'ble Madras High Court in the case of United Christmas Celebration Committee Charitable Trust (supra) directly addresses such a controversy. The Hon'ble High Court was considering a delay of 1631 days and observed that apart from the period of delay, the quality of explanation and the legal assistance, if any, sought and rendered to the litigant are also important aspects to be looked at to come to a conclusion as to whether the delay was intentional and/or deliberate. On the basis of the material on record before it, the Hon'ble High Court inferred that it appeared that the assessee therein had not received the best legal assistance in the matter and, therefore, deemed it fit to condone even the undue delay of 1631 days. I am only trying to emphasise that in order to condone the delay, what is determinative is the quality of explanation and not merely the length of the delay. The Hon'ble Supreme Court in the case of Collector, Land Acquisition vs. Mst. Katiji & Ors., 167 ITR 471 (SC) opined that when technical consideration and substantial justice are pitted against each other, the courts are expected to further the cause of substantial justice. For the said reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nst the decision of the CIT(A) sustaining the action of the Assessing Officer adopting the full value of consideration at Rs. 33,63,333/- by applying Section 50C of the Act. The learned representative for the assessee vehemently pointed out that the CIT(A) failed to take into account the fact that the taxability of Capital Gains is governed by the event of transfer of a Capital asset taking place in the relevant assessment year, and that in the instant year, there is no effective 'transfer' in the real terms so as to justify any addition on account of capital gains. The learned representative pointed out that before the CIT(A), assessee has uncontrovertibly pointed out that the Conveyance Deed dated 10.08.2008 between the assessee and her family members and M/s. Saroj Associate, the builder, on the other hand provided for receipt of three flats upto 500 sq. ft. built-up area each over and above the amount of Rs. 60,00,000/-, which was already paid. It was pointed out that there was no likelihood of getting the three flats inasmuch as the construction of the property had not even started. The learned representative pointed out that even the possession has not been taken over by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upon the judgment of the Hon'ble Bombay High Court in the case of Zuari Estate Development and Investment Co. Pvt. Ltd. (supra). 13. I find that the aforesaid plea being set-up by the assessee requires a factual appreciation of the affairs, which could appropriately be undertaken at the level of the Assessing Officer. Notably, in the orders of the authorities below, there are significant gaps in culling out the proper fact-situation. For instance, the entire terms and conditions of the Conveyance Deed dated 10.08.2008 between the assessee and her family members and M/s. Saroj Associate, the builder on the other hand have also not been culled out and to compound the matters further, even before the Tribunal the copy of the agreement has not being filed. Therefore, in my view, it would be appropriate if the matter is revisited by the Assessing Officer who shall consider all the facts which have a bearing on the tax liability of the assessee vis-a-vis the transaction with the builder with respect to the Deonar property, and decide afresh. 14. There is another fallacy which is quite apparent and needs to be examined. Pertinently, assessee had pointed out that the three flats have ..... X X X X Extracts X X X X X X X X Extracts X X X X
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