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TMI Blog2022 (3) TMI 298X X X X Extracts X X X X X X X X Extracts X X X X ..... ities from buying and owning agricultural land). Therefore, the contention is that the directors were only facilitator of the transactions and there is no direct or indirect benefit to them. In such a factual scenario, we have to determine who had the actual / de facto owner of the impugned properties. This fact can be determined only by examining who is actually funded the purchase of land and who is in receipt of the sale consideration when the land was sold during the assessment year 2008-2009 and 2009-2010. There is no material on record, except the Board s Resolution dated 13.12.2001, regarding the purchase of agricultural land (which has a reference at page 2 and 3 of the assessment order in the case of the company for assessment years 2008-2009 and 2009- 2010). The Board Resolution by itself cannot be the determinative factor to decide who is the de facto owner of the impugned lands. Therefore, we are not in a position to decide and is constrained to restore this issue to the files of the A.O. A.O. is directed to examine whether the company had paid the purchase price in the year 2004 (as claimed) and company was in receipt of sale consideration when the lands were sold i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Name of the company Asst.Year 1. 6/Bang/2013 M/s.Shyamaraju Company (India) Private Limited 2008-2009 2. 7/Bang/2013 M/s.Shyamaraju Company (India) Private Limited 2009-2010 3. 8/Bang/2013 M/s.Shyamaraju Co. (India) Private Limited 2008-2009 4. 9/Bang/2013 Sri.Umesh S. Raju 2008-2009 3. The solitary issue raised in assessee s appeal is in whose hands capital gains is to be taxed, whether in the hands of the company or in the hands of individual directors. 4. The brief facts of the case in relation to assessee s appeal are as follows: It is contended by the learned AR that the company, namely, M/s.Shyamaraju Company (India) Private Limited had acquired certain lands in the year 2003 and 2004 through its directors (Sri.Umesh S.Raju and Sri.P.Shyama Raju) under Board Resolution dated 13.12.2001. It was stated that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 2(14) of the Act and hence not exigible to capital gains tax. The CIT(A) having confirmed the assessment order for the A.Y. 2008-2009, held that the long term capital gains arising out of the sale made in the A.Y. 2009-2010 also ought to be assessed substantively in the hands of the Director and protectively in the hands of the company, thus reversing the decision of the A.O., which was not subject matter of appeal. The CIT(A) also held that the land sold was a capital asset u/s 2(14) of the Act. 9. Aggrieved by the orders for assessment years 2008-2009 and 2009-2010, the company is in appeal before the Tribunal by contending that the capital gains ought to be assessed substantively in its hands and also raised grounds that it is exempt from capital gains since it is a sale of agricultural land. The concerned directors are also in appeal for assessment year 2008-2009 before the ITAT contending that the capital gains has to be taxed in the hands of the company. Further, the directors have also claimed exemption u/s 54F of the I.T.Act if capital gains is taxable in their individual hands. The learned AR reiterated the submissions made before the Income Tax Authorities. 10. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of the company for assessment years 2008-2009 and 2009- 2010). The Board Resolution by itself cannot be the determinative factor to decide who is the de facto owner of the impugned lands. Therefore, we are not in a position to decide and is constrained to restore this issue to the files of the A.O. The A.O. is directed to examine whether the company had paid the purchase price in the year 2004 (as claimed) and company was in receipt of sale consideration when the lands were sold in the year 2008-2009 and 2009-2010 and the directors of the company are only facilitators of the said transactions. If the answer to the above questions are in the affirmative, prima facie, the capital gains of sale of land is to be assessed substantially in the hands of the company. With these observations, we dispose of the four appeal preferred by the assessee. 14. Before concluding, it is to be mentioned that in company s appeals, grounds are raised that sale of impugned land would not be exigible not give rise to capital gains, since it is agricultural land. However, during the course of hearing, the learned AR did not press this ground. Similarly, in directors appeal (Sri.P.Shyamaraju ..... X X X X Extracts X X X X X X X X Extracts X X X X
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