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TMI Blog2024 (10) TMI 1087X X X X Extracts X X X X X X X X Extracts X X X X ..... he sale deed, after it is registered, it will operate from the date of its execution. As the sale deed operates from the date on which it is executed and if any changes are made with the consent of both parties the same also relates back to the date of the execution of the sale deed. Therefore, having considered the provisions of section 47 of the Registration Act, 1908,as interpreted by the Hon ble Supreme Court in the judgment cited supra, we are of the considered view that the deed of conveyance in the present case shall operate from the date of its execution, i.e. 31.03.2017. Thus, since the deed of conveyance was executed amongst the parties in respect of immovable property on 31.03.2017, the provisions of section 56(2)(x), which were inserted by Finance Act, 2017 w.e.f. 01.04.2017, are not applicable to the present case and the said section can be only applicable to the facts wherein the sale deeds are executed on or after 01.04.2017 pursuant to which immovable property is received by any person. Assessee appeal allowed. - Shri Sandeep Singh Karhail, Judicial Member And Shri Gagan Goyal, Accountant Member For the Assessee : Shri Nitesh Joshi For the Revenue : Smt. Sanyogita ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing that the said plots of land could not be regarded as its stock in trade. d. the present transactions, do not fall within the object and purpose for which the said section was inserted in the Act. 2. That the Ld. CIT(A) ought to have held that the third proviso below section56(2)(x) is applicable to the present case and it was incumbent on the AO to refer the valuation of the said properties to a Valuation Officer. The AO not having followed this mandate of law, the assessment order passed by him including the addition made under the said section is illegal and bad in law. 4. In its appeal, the Revenue has raised the grounds challenging the deletion of the addition made under section 56(2)(x) of the Act. On the other hand, the assessee has filed the Cross Objection, inter alia, challenging the applicability of the provisions of section 56(2)(x) of the Act to the present case. As the aforesaid issue raised by the assessee, vide its Cross Objection, goes to the very root of the addition made in the present case, therefore, we are considering the said issue at the outset. 5. The brief facts of the case are that the assessee is a limited liability partnership firm and is engaged in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the learned CIT(A), the assessee submitted that the provisions of section 56(2)(x) of the Act are not applicable to the present case as the deed for conveyance was entered with the seller on 31.03.2017 and all the other formalities including the handover of symbolic possession and payment of consideration were completed by that date. Thus, it was the plea of the assessee that section 56(2)(x) of the Act is only applicable when any person receives any sum of money or any other immovable property after 01.04.2017 and in the present case, the entire transaction is prior to 01.04.2017. The learned CIT(A), vide impugned order, rejected the submission of the assessee and held that under section 56(2)(x) of the Act the date of registration is relevant, which undisputedly in the present case is after 01.04.2017. The learned CIT(A) by referring to the extracts of ITR/Financials for the assessment year 2017-18 observed that this transaction was not considered in the balance-sheet or in the notes to accounts by the assessee. The learned CIT(A) also relied upon the decision of the Hon ble Supreme Court in the Suraj Lamp Industries (P.) Ltd. vs. State of Haryana, reported in (2012) 340 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he words are unequivocal, there is no scope for importing any rule of interpretation , is very pertinent and relevant. Considering that S.56(2)(x) has given prime importance to the date of registration and also given specific leeway to cases where the the date of registration is different from the date of agreement (subject to non-cash payment mode), I am of the view that there is no scope for any interpretation in a manner canvassed by the appellant. The argument of the appellant that S.47 of the Registration Act has over-riding force has no merit in view of the unequivocal usage of words the date of registration , which in this case is13.04.2017. In the case of Southern Technologies Ltd vs JCIT, 187 Taxman 346 (SC), it was categorically held by Hon'ble SC that provisions of RBI cannot over-ride provisions of I-T Act. Similarly, in the case of New India Industries Ltd vs ACIT, 18 SOT 51, ITAT Delhi (Special Bench), it was held by Hon'ble Tribunal that other Acts cannot over-ride the provisions of the Income-tax Act. The argument that S.56(2)(x) does not apply to a case where the the date of registration is after 01.04.2017 is not borne out from the provisions of the Act an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t for the adjudication of the issue at hand. Section 56(2)(x)(b) of the Act reads as follows: - (b) any immovable property, (A) without consideration, the stamp duty value of which exceeds fifty thousand rupees, the stamp duty value of such property; (B) for a consideration, the stamp duty value of such property as exceeds such consideration, if the amount of such excess is more than the higher of the following amounts, namely: (i) the amount of fifty thousand rupees; and (ii) the amount equal to five per cent of the consideration: Provided that where the date of agreement fixing the amount of consideration for the transfer of immovable property and the date of registration are not the same, the stamp duty value on the date of agreement may be taken for the purposes of this sub-clause : Provided further that the provisions of the first proviso shall apply only in a case where the amount of consideration referred to therein, or a part thereof, has been paid by way of an account payee cheque or an account payee bank draft or by use of electronic clearing system through a bank account, on or before the date of agreement for transfer of such immovable property: Provided also that where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions of section 47 of the Registration Act, 1908, which provides that a registered document shall operate from the time from which it would have commenced to operate if no registration thereof had been required or made, and not from the time of its registration, held that when a compulsory registerable document is registered according to Registration Act, it shall operate from a date before the date of its registration. The Hon ble Supreme Court further held that if in a given case, a sale deed is executed and the entire agreed consideration is paid on or before execution of the sale deed, after it is registered, it will operate from the date of its execution. The relevant findings of the Hon ble Supreme Court, in the aforesaid decision, are reproduced as follows: - 5. The High Court, in the impugned judgment, has relied upon Section 47 of The Registration Act, 1908 (the Registration Act), which reads thus: 47. Time from which registered document operates. A registered document shall operate from the time from which it would have commenced to operate if no registration thereof had been required or made, and not from the time of its registration. 6.On plain reading of Section 47, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 35) ILR 62 Cal 979] and Gobardhan Bar v. Guna Dhar Bar [ILR (1940) II Cal 270]. (underline supplied) 8.The Constitution Bench held that Section 47 of the Registration Act does not deal with the issue when the sale is complete. The Constitution Bench held that Section 47 applies to a document only after it has been registered, and it has nothing to do with the completion of the sale when the instrument is one of sale. It was also held that once a document is registered, it will operate from an earlier date, as provided in Section 47 of the Registration Act. 9.Section 54 of the Transfer of Property Act, 1984 (the Transfer of Property Act) reads thus: 54. Sale defined. Sale is a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised. Sale how made Such transfer, in the case of tangible immoveable property of the value of one hundred rupees and upwards, or in the case of a reversion or other intangible thing, can be made only by a registered instrument. In the case of tangible immoveable property of a value less than one hundred rupees, such transfer may be made either by a registered instrument or by delivery of the property. Delivery of tangible ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Registration Act, 1908,as interpreted by the Hon ble Supreme Court in the judgment cited supra, we are of the considered view that the deed of conveyance in the present case shall operate from the date of its execution, i.e. 31.03.2017. 12. We further find that in Bajrang Lal Naredi vs. ITO, in ITA No. 327/Ran/2018, the coordinate bench of the Tribunal vide order dated 20.01.2020 held that mere registration at later date would not cover a transaction already executed in the earlier years, where substantial obligations have already been discharged and a substantial right has accrued to the taxpayer therefrom. Similarly, in Rajib Rathindra Saha vs. ITO, reported in (2022) 95 ITR (Trib.) 216 (Mum.), the Tribunal held that since the agreement was executed on 31.03.2013, i.e. during the assessment year 2013-14, the provisions of section 56(2)(vii)(b) of the Act as applicable to the assessment year 2013-14 would apply and the registration of agreement on the subsequent date would not alter the situation, as the registration of agreement is a compliance of a legal requirement under the Registration Act, 1908. 13. During the hearing, the learned Departmental Representative ( learne ..... 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