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TMI Blog2023 (2) TMI 428X X X X Extracts X X X X X X X X Extracts X X X X ..... , assessment for the year 2013-14 is sought to be reopened, on the ground that the assessing officer had reason to believe that income chargeable to tax for the assessment year 2013-14 had escaped assessment within the meaning of Section 147 of the Act. 2. The reasons for reopening as furnished to the Petitioner are as under : "Reasons for reopening of the assessment 1. Brief details of the assessee : The assessee is an individual. 2. Brief details of the information collected/received by the AO : Information has been received from ADIT (Inv.) Unit-IV(2), Thane about assessee that assessee has given his land at Chikhloli for development to Sai Ashray Developers Pvt. Ltd. During the year, assessee Mr. Bharat J. Patel and two other co- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uated within municipal limits of Ambernath Municipality hence constitutes capital assets as per section 2(14) of the Act. Further, as per order dated 9 April 2012, issued by the O/o District Collector, Thane the said land has been granted the status of Non-agricultural land. In view of facts mentioned above, it is clear that profit arising from transfer of the land is taxable in hands of assessee during FY 2012-13. Market value of Rs.9.5994 corore or the market value of constructed saleable area of 541556 sq. ft. constitutes the consideration received by land owners. 3. Analysis of information collected/received : Records of assessee available in the office has been perused. It is found that as on 31.03.2014, assessee has received loan/d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the objections raised by the Petitioner before the assessing officer was that Section 2(47)(v), which was invoked for the purpose of reopening had no application inasmuch as granting a license to the developer, who entered into the assessee's land for the purpose of development did not amount to 'allowing the possession of the land' as contemplated under Section 53A of the Transfer of Property Act, 1882, and, therefore, Section 2(47)(v) would not apply. Reliance was also placed upon the Apex Court judgment rendered in the case of Seshasayee Steels (P.) Ltd. Vs. Assistant Commissioner of Income Tax Vs. Company Circle VI(2), Chennai [2020] 115 taxmann.com 5(SC). 4. Objections raised by the Petitioner were, however, rejected by the Assessin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny rights herein ; or (iii) the compulsory acquisition thereof under any law ; or (iv) in a case where the asset is converted by the owner thereof into, or is treated by him as, stock-in- trade of a business carried on him, such conversion or treatment ; [or] (iva) the maturity or redemption of a zero coupon bond; or (v) any transaction involving the allowing the possession of any immovable property to be taken or retained in part performance of a contract of the nature referred to in section 53-A of the Transfer of Property Act, 1882 (4 of 1882); or (vi) ......... [Explanation 1] - ....... [Explanation 2 - For the removal of doubts, it is hereby clarified that "transfer" includes and shall be deemed to have always i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eree and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract: Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof. 7. The Apex Court in Seshasayee Steels (P.) Ltd. (supra), held that Section 53A of the Transfer of Property Act, 1882 would not be attracted in a case where a license was given to another for purposes of development of the flats and selling the same and that granting such a license could not be said to be granting possession within the meaning of Section 53A. It was held : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Petitioner and the developer, namely, Sai Ashray Developers Pvt Ltd., which had permitted the said developer to develop the property belonging to the owners only as a 'licensee'. Reliance in this regard was placed upon the clause 10(i) of the development agreement, which reads as under : "10. DEVELOPERS' RIGHTS, ENTITLEMENTS, DECLARATIONS AND OBLIGATIONS On and from execution hereof and subject to the fulfllment of all the terms and conditions to be performed and complied with by them under this Agreement, the Developers shall have rights and be entitled to do the following, at its own costs and expenses :- (i) To enter into the said properties as an exclusive licensee for the purpose of development of the said Properties thereon with ..... X X X X Extracts X X X X X X X X Extracts X X X X
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