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TMI Blog2023 (1) TMI 1009X X X X Extracts X X X X X X X X Extracts X X X X ..... .Y. 2012-13 is treated as a "lead case". In this appeal, the assessee has raised following ground of appeal: "1. On the facts and circumstances of the, the ld. CIT(A) has erred in confirming the addition made by Ld AO of short term capital gain of Rs. 27,28,584/- as against correct short term capital gain computed by appellant of Rs. 6,32,057/-. 2. On the facts and circumstances of the case, the ld. CIT(A) has erred in making enhancement of short term capital gain of appellant." 3. The appellant craves leave to add, amend, modify or delete any of the above grounds of appeal." 2. Brief facts of the case are that the assessee is an individual, filed his return of income for A.Y. 2012-13 on 30/03/2013 declaring income of Rs. 2,96,200/-. The case was selected for scrutiny. During the assessment, the Assessing Officer noted that as per information (AIR) filed by Sub- Registrar, Silvassa, the assessee sold and purchased several immovable properties. The Assessing Officer summarised the details in the following manner: Sr. No. Property Details Sale Consideration amount (in Rs.) Date 1. Immovable property sold 65,25,000/- 12/03/2012 2. Immovable property sold 42,90,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on account of levelling of land. On perusal of such bills, the Assessing Officer noted that one bill of Rs. 2.00 lacs were issued by Ramesh B. Mohite was not in bill format and merely a quotation and not allowable. Accordingly, the Assessing Officer allowed expenses of Rs. 4,45,800/-. The Assessing Officer computed capital gain in the following manner: "1. Land mentioned in para No. 4. Sale consideration (14.3 acre) Rs. 42,90,000/- Sale consideration (3 acre) Rs. 09,00,000/- Total sale consideration Rs. 51,90,000/- Less: Cost of purchase Rs. 33,50,000/- Stamp duty Rs. 00,99,500/- Registration charges Rs. 00,24,926/- Cost of improvement Rs. Nil Rs. 34,74,426/- Short term capital gain Rs. 17,15,574/- 2. Land mentioned in Para No. 5 Total sale consideration Rs. 65,25,00,000/- Less Cost of purchase Rs. 22,25,000/- Stamp duty Rs. 00,65,800/- Registration charges Rs. 00,16,481/- N.A. Land charges Rs. 00,30,325/- Cost of improvement Rs. 04,45,800/- Rs. 27,83,406/- Short term capital gain Rs. 37,41,594/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd 2012-13. The assessee further stated that he produced Rajesh K Mehta during the hearing and filed his affidavit. The assessee further stated that Rajesh K Mehta was holding possession of land from last 11 years and he demanded huge amount from assessee and his co-owner, ultimately, it was mutually decided to transfer a piece of land without any consideration. Consideration was mentioned in the sale deed for the purpose of registration. Cheques mentioned on the sale deed were never realised either by assessee or by his co-owner. Such fact was admitted by the said purchaser before the Assessing Officer as well as Joint Commissioner of Income Tax (JCIT). There is no evidence that such sale consideration was passed from Rajesh K Mehta to the assessee. To support such contention, the assessee relied on the decision of Hon'ble Bombay High Court in the case of CIT Vs Hemal Raju Sheth (2016) 70 (I) ITCL 362 wherein it was held that any contingent differed consideration could not be taxed in the hands of the until such consideration is actually received or accrued. Such sale deed was executed without consideration would have been blocked for a limited period as Rajesh K Mehta was holding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tural land i.e. Survey No. 22/2 admeasuring 0.80 hectare out of 1.56 hectare of village Falandi from sale consideration of this land till that time the land records will not be mutated in favour of purchasers. On the basis of such observation, the ld. CIT(A) was of the view that from the said order, it was mandated that widow of Nani Navla will purchase 0.80 hectare of land at village Falandi out of sale consideration of land at S.R. No. 227/2. The assessee purchased land vide sale deed dated 12/08/2011 and the said sale deed nowhere mentioned over and above Rs. 22,25,000/- for 2.75 acres of land for SR No. 227/2. Thus, as per clause (18) of order of revenue department, the assessee was not required to pay any such amount. Such condition was on the sale, that prior to mutation of land in favour of purchaser, only to safeguard the interest of widow of land of plot of S.R. No. 227/2, therefore, there is no justification for claiming such cost of payment of Rs. 15.55 lacs. Therefore, the affidavit about the claiming of receipt of Rs. 15.55 lacs and 9.00 lacs has no relevance. With regard to expenses of Rs. 9,03,854/- on account of improvement cost, the ld. CIT(A) was of the view that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts that the assessee along with other co-owner purchased land in Survey No. 227/2/69/1 situated at Moje Dadra & Nagar Haveli from Nani Navla Patel and others vide sale deed dated 22/08/2011 for a sale consideration of Rs. 37,80,000/-. As per para 18 of order of Collector, Dadra & Nagar Haveli dated 24/04/2010 that the sellers of land shall purchase agricultural land from the sale consideration and till that time land record shall not be mutated in favour of purchaser. Thus, in order to get peaceful possession and complete ownership, the assessee paid Rs. 9.00 lacs to seller i.e. Nani Navla Patel and others to purchase agricultural land in the name of sellers. Such amount was borne equally by assessee as well as other co-owner. To support such contention, the assessee filed copy of order of Collector, Dadra & Nagar Haveli dated 24/04/2010, affidavit of seller in Gujarati along with its English translation. 10. On the other hand, the ld. Sr. DR for the revenue supported the order of ld. CIT(A). The ld. Sr. DR for the revenue submits that the assessee is claiming reduction of sale consideration of Rs. 9.00 lacs in respect of sale of three acres land sold out of Survey No. 233/1 to Ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 28/03/2012 drawn on Dena Bank was never encashed or realised either from bank account of Rajesh K Mehta or in the account of assessee. Thus, consideration shown in the sale deed was never passed/received by assessee. Shri Rajesh K Mehta has confirmed his fact in his affidavit. Thus, the said amount was not received by the assessee. It is settled position under law that income which has earned or accrued can only be taxed. In my considered view, once it is shown and proved on record that Rs. 9.00 lacs is not received by the assessee, so such income cannot be considered for taxation in the hands of assessee. So the assessee get relief to that extent. 13. So far as other amount which consists of Rs. 15.55 lacs and Rs. 9.00 lacs which was allegedly incurred by assessee for purchasing of land in the name of Nani Navla Patel as per the direction of Collector, Dadra & Nagar Haveli, I am fully convinced with the order of ld. CIT(A) that there is no condition precedent in the sale deed dated 12/08/2011. Moreover, such condition was on the seller of land to maintain minimum standard of area of land to safeguard their interest. Therefore, I do not find any justification for allowing such ..... X X X X Extracts X X X X X X X X Extracts X X X X
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