9911796707
TMI Blog2021 (1) TMI 409X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Commissioner of Income Tax (Appeals)-16, Chennai, dated 18.12.2018 and pertains to assessment years 2014-15. 2. The assessee has raised the following grounds of appeal:- 1. The order of the Income Tax Officer, International Taxation - 1(2), Chennai, dated 27.12.2017 for the above assessment years is contrary to the law, facts and in the circumstances of the case. 2. The learned assessing officer erred in treating the capital gain tax liability in the assessment year 2014-2015 in spite of the fact that, the actual capital gain tax liability arises in the year of execution of JDA, which grants possession over the land through irrevocable license which is related to the financial year 2006-2007 relevant to the assessment year 2007-2008. 3. Alternatively, the learned assessing officer erred in ignoring the order of the CIT-Appeal in the assessee s co-owners case. On the same property and same JDA, the learned CIT-Appeal, decided the issue of point of taxation of IDA agreement and held that the capital gain tax liability arises for the assessment year 2011-2012 only. 4. Alternatively, the learned assessing officer erred in invoking section 50C of the Act in spite o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as provided under the Act and hence the delay in filing of appeal before the ld.CIT(A) has been condoned and the appeal filed by the assessee is admitted for adjudication. 6. The brief facts of the case are that the assessee, a nonresident has not filed her return of income within the due date as per Section 139(1) of the Act. The case has been reopened u/s.147 of the Act by issue of notice u/s.148 of the Act dated 16.06.2016. In the mean time, the assessee has filed her return of income on 19.09.2016 declaring a total income of ₹ 3,21,97,750/-. In response to notice issued u/s.148 of the Act, the assessee vide letter dated 10.12.2016 intimated to the AO that return filed on 19.09.2016 may be treated as return filed in response to notice issued u/s.148 of the Act. The case has been selected for scrutiny and during the course of assessment proceedings the AO noted that a survey u/s.133A of the Act was conducted in the case of M/s.Paramount Builders (Chennai) Limited by the Investigation Wing on 05.03.2014. During the course of survey, it was ascertained that the assessee and 13 others had entered into Joint Development Agreement (JDA) on 27.06.2006 with M/s. P.S.Srijan Real ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The facts being identical for the present appeal, by following the decision of the ITAT in other coowners case, the appeal filed by the assessee may be allowed. 9. The ld.DR on the other hand strongly supporting order of the ld.CIT(A) and AO submitted that although the issue is covered in favour of the assessee by the decision of ITAT, Chennai B Bench, in other co-owners case, but fact remains that AO has distinguished the finding recorded by the Tribunal in other co-owners case while concluding the assessment on the ground that the Tribunal has ignored crucial aspect of Section 17(1A) of Indian Registration Act, 1908 read with section 53A of Transfer of Property Act, 1882 to hold that capital gain accrued for the assessment year 2007-08 and hence by taking note of subsequent sharing agreement between the assessee and builders dated 10.07.2013 computed long term capital gain for the assessment year 2014-15. The ld.DR further submitted that as per the amended provisions of section 17(1A) of Indian Registration Act, 1908, unless a document giving possession of any immovable property is not registered as required under the Act, the same cannot be considered as valid document wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e return filed on 19-09-2016, the income returned is ₹ 3,21,97,750/- which includes ₹ 3,14,46,1O8/- towards LTCG on sale of assessee s share of land at Valacherry, Tambaram Main Road, Chennai for construction of Grand Mall, vide a JDA dated 27-06-2006 entered into with a developer. The only other effective ground of the assessee before the ITAT, apart from the ground regarding condonation of the delay by The CIT(A) is - The CIT(A) erred in not following the judgement of the Honourable Incometax Appellate Tribunal in the case of Sathak Ahmed Shah [Co-owner case] in ITA No. 401/CHNY/2018 dated 05-10-2018, which is in favour of the assessee. 2.4 The order of The Honourable ITAT referred to by the Appellant in the above ground of appeal is an order wherein, the Assessment year in which the LTCG on sale of land is to be charged to tax? is decided. The Hon ble ITAT, following it s own judgement in the case of another co-owner Mr. Shafiq Mohammed Shah in ITA No.s 945 1331/ CHNY/2016 dated 11-05-2017 decided that the LTCG income on sale of land is to be charged to tax in A.Y.2007-08. 2.5 One important fact in this regard is that the assessee has recognised the L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .Y. 2006-07 or for that matter any other Assessment year other than A.Y.2014-15. This ground is nothing but stating that the Income, specifically LTCG income returned to tax as per the Return of Income shall not be assessed, sounds unusual. In case the assessee wants to alter or differ from the income returned to tax through filing of a return of Income, the only option is through filing of another Return of Income, legally termed Revised Return , for which the eligibility conditions and procedure is laid down in Section 139(5) of The Act; which states that - a Revised return can only be filed when the original return was filed well within due date as per Section 139(1) and the revised return can filed before the completion of the Assessment year or before completion of assessment; whichever is earlier. The Assessee, having not filed the original Return of income u/s 139(1) in time and the due date for filing of even a belated return of income for the assessment year 2014-15 is over by 31-03-2016, the manual return handed over to the Assessing officer alongwith a letter dated 06-06-2017 filed on 12-06-2017 is invalid and Non-est. There is no other method by which the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 53A of TP Act was also extracted on page 17 of the order. However, a particular sentence not withstanding that the contract, though required to be registered, has not been registered having been deleted in the amendment to said Act during 2001 and therefore although is not relevant for the period during which the JDA has been executed is considered based on which it is decided that the provisions of Section 53A of Transfer of Property Act and in turn the provisions of Section 2(47) (v) are applicable and the transfer has occurred at the time of the JDA. 3.4 It is submitted that Section 17(1A) of The Registration Act which reads as under is inserted in Section 17 (documents of which Registration is compulsory) of the said Act through S.3 of Act 48 of 2001, to be effective from 24-09-2001: 17 (1A): The documents containing contracts to transfer for consideration, any immovable property for the purpose of Section 53A of the Transfer of Property Act, 1882 (4 of 1882) shall be registered if they have been executed on or after the commencement of Registration and Other Related Laws (Amendment) Act, 2001 and if such documents are not registered on or after such commencemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate on which allocation agreement has been entered into between land owner and developer allocating the built up area. Therefore it is prayed that the ground of appeal of the assessee to follow the decision in the case of the co-owne and decide as to in which assessment year, the LTCG is to be levied; may be dismissed and the assessment order be confirmed. 10. We have heard both the parties, perused the materials on record and gone through the orders of the authorities below. We find that an identical issue has been considered by the coordinate Bench of ITAT in the case of Shri Shafiq Mohammed Shah in ITA No.1331/Mds/2016 vide order dated 11.05.2017, where after considering JDA dated 27.06.2006 between land owners and the developer held that taxability of long term capital gain on transfer of land pursuant to JDA dated 27.06.2006 arises only in the financial year 2006-07 relevant to assessment year 2007-08, when the assessee has entered into JDA with the developer and also hand over physical possession of land to the developer. The said decision has been subsequently followed in series of decisions in other co-owners case including in the cases of Shri Mafaz Mohammad in ITA No. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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