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TMI Blog2024 (2) TMI 1403X X X X Extracts X X X X X X X X Extracts X X X X ..... on account of Long Term Capital Gain in respect of development agreement by holding no transfer of capital asset u/s. 2(47)(v) of the Act. 5. The brief facts relating to the issue on hand are that the assessee is an individual, engaged in the business of distribution of stationary. The assessee filed return of income on 31-03-2013 declaring a total income of Rs.1,63,290/-. A search action was conducted in the case of M/s. Concrete Developers u/s. 132 of the Act on 01-12-2015. During the said search a joint development agreement entered between assessee and others and M/s. Concrete Developers was seized for property at Mouza Somalwada CTS No. 504, Nagpur was seized. In pursuance of the same a notice u/s. 153A r.w.s. 153C of the Act was issued requesting the assessee to file return of income within 30 days from the date of receipt of such notice. The assessee filed a letter on 18-11-2017 enclosing return of income which was filed on 31-03-2013 stating it to be treat the same as in response to the notice u/s. 153A r.w.s. 153C of the Act. The AO opined regarding the agreement of joint development agreement that the assessee has given possession of the land to the developer and all th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Further, he argued that the CIT(A) erred in holding the assessee is correctly declared the capital gains on sale of immovable property in the A.Y. 2018-19 and supported the order of AO. He prayed to allow the grounds raised by the Revenue and quash the impugned order. 8. The ld. AR, Shri K.P. Dewani submits that the assessee's consideration is 42.5% of share in the property, was received in June, 2017 and declared Long Term Capital Gain in the return of income for A.Y. 2018-19. He submits that the appellant-revenue assessed the capital gain in the hands of the assessee for A.Y. 2018-19 and the assessee has been subjected to tax. He vehemently argued that the appellant-revenue cannot agitate the capital gain should be assessed in the year under consideration as the Joint Development Agreement entered therein, if so, it will amount to double taxation of income already subjected to tax in A.Y. 2018-19. The ld. AR drew our attention to written submissions and reiterated the same. He supported the order of CIT(A) and prayed to dismiss the grounds raised by the appellant-revenue. 9. Heard both the parties and perused the material available on record. The short point arises is as to w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f reserving their 42.5% built-up area which also supports the arguments of ld. AR. 10. The ld. AR placed on record the decision dated 10-02-2023 of Hon'ble High Court of Bombay in the case of Late Bharat Jayantilal Patel in Writ Petition No. 1612 of 2022 and by referring to para 7 of the said decision, the ld. AR submits that the facts in the present case are identical to the facts of the case before Hon'ble High Court of Bombay, argued that the license for the purpose of developing the land into flats and selling the same, such license cannot be said to be possession within the meaning of section 53A of the Transfer of Property Act, 1882. He submits that, in order to come to such conclusion by the Hon'ble High Court of Bombay, placed reliance on the decision of Hon'ble Supreme Court in the case of Seshasayee Steels (P.) Ltd. reported in (2020) 115 taxmann.com 5 (SC). For better understanding the relevant portion of the decision of Hon'ble High Court of Bombay is reproduced as under : "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 purp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said Properties thereon with their own sources and cost as per the permission/NOC that may be given by the Local Authorities and the Applicable law; 9. Applying the principle as crystallized by the Apex Court reproduced herein above, to the facts of the present case, it can be seen that the development agreement permitted construction on the land in question only as a licensee which did not have the effect of transmitting possession in favour of the licensee within the meaning and spirit of Section 53A of T.P. Act. If that is so, then there would be neither any tangible material nor any reason for the assessing officer to believe that 'any income chargeable to tax had escaped assessment' and the action of the assessing officer, therefore, would be without jurisdiction." 11. On careful reading of the above, we note that the Court 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 the purpose of development of flats and selling the same and granting such license could not be said to be granting possession within the meaning of section 53A of the Transfer of Property Act, 1882. In the present case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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