Shatrughan K. Patil Vs ACIT (ITAT Mumbai)
No Transfer u/s 2(47) – Temporary Alternate Accommodation Not Taxable – Addition on Notarised Agreement Deleted – ITAT Mumbai
AO made addition of ₹13.56 lakh treating notarised agreement for flat as consideration received under development agreement and presumed transfer of property. CIT(A) upheld addition. Assessee contended that flat was only temporary alternate accommodation provided by developer during redevelopment and no ownership or transfer existed.
ITAT held that notarised agreement did not confer ownership rights and developer confirmed that flat remained in its name with municipal taxes and electricity connection also in developer’s name. Tribunal observed that assessee occupied flat only as interim arrangement and conditions of “transfer” u/s 2(47) were not satisfied. Since no real income or ownership arose, addition was deleted. Assessee appeal allowed.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal filed by the assessee is against the order of CIT(A) Pune – 11, vide order no. ITBA/APL/S/250/2023-24/1057012775(1), dated 12.10.2023, passed against the assessment order by ACIT, Central Circle 2, Thane, u/s. 143(3) r.w.s. 153A of the Income-tax Act (hereinafter referred to as the “Act”), dated 28.12.2019 for Assessment Year 2012-13.
2. Grounds taken by assessee are reproduced as under:
“1..The Hon CIT(A) erred in the addition of Rs.13,56,250/- made by the Id AO by holding notarised agreement which has been provided by the developer on temporarily basis no registered agreement has been executed and allotted against the development agreement duly executed as dt. on 13/11/2007.
i) The development agreement executed with Minaxi developers dt. on 13/11/2007
ii) Further that there were no “transfer” as postulated u/s 2(47)(v) of IT Act 1961, and therefore no income arose in the hands of the Appellant in the year under appeal on execution of development agreement dt. on 13/11/2007.
iii) The Appellant has jointly owned the ancestor’s property with another family members.
The addition of Rs. 13,56,250/- may kindly be deleted.”
3. It is noted that there is a delay of 227 days in filing the present appeal before the Tribunal for which petition for condonation of delay along with affidavit is placed on record. From the perusal of the same, it is noted that the reasons explained by the assessee for this delay are on account of his ill health as well as because of his son who met with a major road accident and was hospitalized. These medical exigencies prevented the assessee from filing the appeal within the prescribed limitation. Assessee has placed on record corroborative documentary evidences in support of his submissions. Considering these on record, we find it appropriate to condone the delay and take up the matter for adjudication.
