No capital gain if developer was allowed to enter property for mere construction under JDA

Anugraha Shelters (P) Ltd. Vs DCIT (ITAT Banagalore) Section 45 of the Income Tax Act lays down that profits and gains arising out of transfer of capital asset effected in the previous year shall be chargeable to income tax under the head ‘capital gains’ and shall be deemed to be the income of the previous year in which the transfer took place. It is thus clear that there should be transfer during the previous year to attract charge to tax on capital gain. Sec.2(47) of the Act defines ‘Transfer’ for the purpose of the Act. A careful perusal of the agreement would show t...