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TMI Blog2023 (12) TMI 1261X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act as the assessee has not allowed the possession of the plot to be taken away by the builder in part performance of a contract . It is just an agreement for carrying out construction on the plot after obtaining requisite permissions from the Government authorities and then after completion of the project, certain area has to be allotted to the assessee. We find merit in the contention of assessee that the said execution of land development agreement cannot be a sale of land in favour of the builder within the meaning of section 2(47)(v) as only construction was allowed to be done by the builders after obtaining necessary approvals from competent authorities and, therefore, the capital gain has wrongly been computed and charged to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment with M/s. Badu Road Developers LLP on 30.07.2014 in respect of the land owned by it. The ld. Assessing Officer on the basis of said joint development agreement computed the short-term capital gain of Rs. 33,84,024/- by taking the value as per stamp valuation authority as deemed sale consideration. The ld. Assessing Officer reduced the cost of acquisition, i.e. Rs. 4,51,935/- from the sale consideration and computed the short term capital gain at Rs. 33,84,024/- and added the same to the total income of the assessee in the assessment framed under section 143(3) dated 16.12.2017. 4. The ld. CIT(Appeals) in the appellate proceeding affirmed the order of the ld. Assessing Officer. 5. After hearing the rival contentions and perusing t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in has wrongly been computed and charged to tax. The ld. A.R. relied on the decision of the Hon ble Jurisdictional High Court in the case of PCIT vs.- Emporis Properties Pvt. Limited reported in (2023) 151 taxmann.com 64 (Calcutta), wherein a similar issue has been decided in favour of the assessee. The Hon ble Court in the said decision has held as under:- From the Joint Development Agreement, it is crystal clear that the assessee continued to be the owner of the property throughout the development of the property and there is no transfer of ownership to the developer. This aspect, in our opinion, was rightly noted by the Tribunal. Thus reading of the entire agreement would show that there was no transfer or sale of asset under the J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th Section 53A of the Transfer of Property Act, 1882. After taking note of the facts, the Hon'ble Supreme Court held as follows: 23. A reading of the JDA in the present case would show that the owner continues to be the owner throughout the agreement, and has at no stage purported to transfer rights akin to ownership to the developer. At the highest, possession alone is given under the agreement, ad that too for a specific purpose - the purpose being to develop the property, as envisaged by all the parties. We are, therefore, of the view that this clause will also not rope in the present transaction. As mentioned earlier, the facts of the case in Balbir Singh Maini (supra) was more or less identical to the case on hand a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law are answered against the revenue. 6. On the other hand, ld. D.R. contended before us that w.e.f. A.Y. 2018-19, a specific provision has been brought on the statute book by inserting section 5A to section 45, which specifically provides for taxation of the said rights when the construction is completed and completion certificate is granted by the competent authority on the said property. Therefore, ld. D.R. submitted that prior to that taxation of the rights under joint development agreement had to be assessed on the basis of land development agreement only. 7. After having considered the facts on record and the ratio laid down by the Hon ble jurisdictional High Court, I am of the view that the capital gain cannot be assessed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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