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TMI Blog2020 (11) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... ation, we are of the considered view that the decision of the CIT (A) in the case of both the assessee are appropriate. Hence, we do not find it necessary to interfere with the decision of the CIT (A) in the case of both the assessee. Therefore, the appeals of the Revenue are devoid of merits. In the case of Joint Development agreement it should be construed that the land owner had entered into business venture by introducing his landed property into the business, accordingly the provisions of Section 45(2) will come into operation and the LTCG shall be chargeable to income tax as his income of the previous year in which the land is transferred, and for the purpose of section 48 of the Act, the fair market value of the land on the dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure operation U/s. 132 of the Act was conducted in the case of M/s. Ramky Estates and Farms Private Limited on 07/02/2013 wherein it was revealed that both these assessees had entered into a development agreement and executed General Power of Attorney on 31/05/2012 with M/s. Ramky Estates and Farms Private limited. Therefore, the case of both the assessees was taken up for scrutiny and finally assessment order U/s. 143(3) of the Act was passed on 31/03/2015 wherein the Ld. AO made addition of ₹ 3,94,24,000/- in the hands of each of the assessees under the head LTCG. On appeal, the Ld. CIT (A) deleted the addition in the case of both the assessees by relying on the decisions of various higher Judiciary aggrieved by which the Revenue is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. It was further argued that the Development Agreement did not quantify any sale consideration. With the above submissions the assessees had took the ground that there was no transfer of property as per the provisions of section 2(47) of the IT Act and therefore the capital gain tax is not leviable. However, the Ld. AO relying in the decision of the Hon ble AP High Court in the case of Potla Nageswara Rao vs. DCIT in ITTA No.245 of 2014, dated 9/4/2014 held that by virtue of the development agreement and handing over of possession of the land, transfer of the immovable property has effected as per the provisions of section 2(47) of the IT Act read with 53A of the Transfer of Property Act. Accordingly, the Ld. AO computed the LTCG of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITO in ITA No. 1578/Hyd/2014 vide its order dated 31/07/2015 relying in the decision of the Hyderabad Benches viz., (i) M/s. Binjusaria Properties Pvt Ltd vs. ACIT, Central Circle-4, Hyderabad in ITA No.157/Hyd/2011, dated 04/04/2014. (b) ACIT vs. Sri R. Srinivasa Rao and others in ITA No. 1 1786/Hyd/2012 dated 28/08/2014 and (c) Ms. K. Radhika vs. DCIT in ITA No. 208/Hyd/2011 had held that no rule can be made out in all the cases of development agreements that there is deemed transfer unless certain parameters exists such as the developer s willingness to execute the development agreement. (8) In the case decided by the Tribunal ITO vs. Shamkumar ITA No. 1604/Hyd/2014, dated 20/03/2015 it was held taking into consideration of the decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ains cannot be brought to tax in the year under appeal. (9) In the case of both the assessees the development agreement has become non-functional and therefore there was no element of transfer as per the provisions of section 2(47) of the IT Act read with section 53A of the TP Act. 5. Before us, the Ld. DR relied on the orders of the Ld. AO and vehemently argued in support of the same while as the Ld. AR relied on the orders of the Ld. CIT (A) and prayed for confirming his orders. 6. We have heard the rival submissions and carefully perused the materials on record. From the facts of the case it is apparent that even though there is a development agreement between both the assessees and the developer the same has become defunct be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year in which the land is transferred, and for the purpose of section 48 of the Act, the fair market value of the land on the dated of introducing the land in the Joint Venture shall be deemed to be the full value of the consideration received or accrued as a result of the transfer of the land. 8. Before parting, it is worthwhile to mention that this order is pronounced after 90 days of hearing the appeal, which is though against the usual norms, we find it appropriate, taking into consideration of the extra-ordinary situation in the light of the lock-down due to Covid-19 pandemic. While doing so, we have relied in the decision of Mumbai Bench of the Tribunal in the case of DCIT vs. JSW Ltd. In ITA No.6264/M/2018 and 6103/M/2018 for AY 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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