Case Law Details
Shri Doddapaneni Atchaiah Tenali Vs ACIT (ITAT Hyderabad)
Learned Counsel for the assessee submitted that the assessee has purchased Plot No.109/B vide registered sale deed No.6621/2003 dated 18.09.2003 and also Plot No.109/C vide registered sale deed No.6622/2003 dated 18.09.2003 from one Mr. G. Bala Swamy. He drew our attention to the recitals in the sale deed according to which the vendor has submitted a proposed layout for development of residential plots in the said land of Acres 03-20 Guntas to HUDA vide No.17641/MP2/HUDA/ 01 dated 9.8.2001 and the sanction of the layout at HUDA is under process. He submitted that the unapproved plots were sold to the assessee and the assessee was put in possession of the land as is mentioned in the registered sale deed. He submitted that the HUDA layout as proposed by Shri Bala Swamy was not approved and he had gifted the entire land to his son, Shri G. Srikant, who ultimately got the HUDA layout approved and the sale deeds executed in favour of the assessee in the year 2003 were unilaterally cancelled and fresh sale deeds were executed on 9.9.2006. He submitted that the assessee had paid the entire sale consideration for the plot to the vendor in the year 2003 itself, and has not paid any further sale consideration in the year 2006. He also drew our attention to the recitals in the sale deed dated 9.9.2006, wherein the earlier registered sale deed and the cancellation thereof and the circumstances under which the two sale deeds are executed are mentioned. Therefore, according to him, the assessee has purchased the asset in the year 2003 itself and due to the difficulties faced by the vendor in getting HUDA layout approved, it has necessitated the cancellation of the earlier deed and registration of the fresh sale deed, but it does not mean that the assessee has purchased the plot only in the year 2006. He has also drawn our attention to the schedule of the property mentioned in the sale deeds of both 2003 and 2006, to demonstrate that the piece of land, though the Plot Nos have changed, is the same. Therefore, according to him, the asset is a long term asset and therefore, the gains from the development agreement being, long term capital gain, is also eligible for exemption u/s 54F of the Act in respect of the flats received by him by virtue of the development agreement. In support of his contention that the sale deed has been executed by Mr. Bala Swamy and the circumstances under which they were cancelled and re-registered by Shri G. Srikant to the assessee, he filed affidavit of Shri G. Bala Swamy and prayed that, it be admitted as an additional evidence and considered for adjudication of the matter.
We find that the cancellation deed is a unilateral document without the assessee being made a party to it and is also in contradiction to the registered sale deed dated 18.09.2003 wherein it has been mentioned that the possession has already been handed over to the assessee. Therefore, the recitals in the unilateral cancellation deed alone, cannot be taken as evidence for holding that the possession of property has been delivered to the assessee only in the year 2006. Therefore, without going into the affidavit of Shri Bala Swamy, which has been filed as an additional evidence, we are inclined to accept the contention of the assessee that he has purchased the property in the year 2003 and therefore, the property is a long term capital asset and the gain arising from transfer thereof is LTCG. Since the gain on entering into the development agreement is LTCG, the assessee is also eligible for the claim of exemption u/s 54F of the Act.
FULL TEXT OF THE ITAT ORDER IS AS FOLLOWS:-
This is assessee’s appeal for the A.Y 2009-10. In this appeal, the assessee is aggrieved by the order of the learned CIT (A)-V, Hyderabad, dated 31/08/2016 confirming the assessment order u/s 143(3) r.w.s. 147 of the I.T. Act dated 4.3.2015. The assessee has raised the following grounds of appeal:
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