Case Law Details
G. Dasaratharami Reddy Vs ITO (ITAT Bangalore)
There is no dispute with regard to the fact that the ‘Agreement to sell’ dated 14.12.2007 contains the clause that the balance amount of Rs.16.50 lakhs shall be paid to the seller after obtaining occupancy certificate and also after giving possession of the property. There is also no dispute with regard to the fact that occupancy certificate was obtained on 17.3.2008, which fact is evident from the subsequent sale deed executed by the assessee on 15.7.2011. There is also no dispute with regard to the fact that the balance amount of Rs. 16.50 lakhs was give by the assessee only at the time of execution of sale deed on 13.8.2008. However the final sale deed dated 13.8.2008 clearly states in clause 4 that the possession of the property had already been given earlier to the assessee. This clause makes it clear that the possession was not given on the date of sale deed but it was given some time earlier.
I also noticed that the assessee has paid stamp duty amount on the date of entering of “agreement to sale” itself in 2007. Further the assessee has paid almost 90% of the purchase consideration on the date of entering “Agreement to sell” itself. Hence there is merit in the submission of Ld A.R that the balance amount of Rs.16.50 lakhs was withheld only to ensure that the sellers obtained occupancy certificate. Looking at the facts and circumstances of the case, I am of the view that there is merit in the contentions of the assessee that the possession of the property was obtained in between period, i.e., subsequent to the receipt of occupancy certificate, which was received in March, 2008 and the date of execution of sale deed on 13.8.2008. If the possession had been obtained prior to 14.7.2008, the same would constitute long term capital asset in the hands of the assessee. From the facts and circumstances of the case, I am of the view that it is quite possible that the assessee should have obtained possession prior to 14.7.2008, in which case the property should be held to be long term capital asset, since the property has been sold on 15.7.2011. Accordingly, I hold that the property is a long term capital asset in the hands of the assessee and hence the loss arising on sale of property shall be computed as long term capital loss.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
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