Pulikkaparambil George Jacob Vs ITO (ITAT Cochin)
The appeal by the assessee, Pulikkaparambil George Jacob, was filed before the Income Tax Appellate Tribunal (ITAT) Cochin against the order of the Commissioner of Income Tax (Appeals)-12, Bengaluru, dated 03 March 2022, which upheld the assessment under Section 143(3) read with Section 147 of the Income Tax Act, 1961 for Assessment Year 2011–12. The primary dispute concerned whether a capital gain arose to the assessee during the year on account of a joint venture agreement (JVA) for property development.
The facts revealed that the assessee’s father, Jacob George, and his brother, Tharian George, executed a General Power of Attorney (GPA) on 08 July 2010, authorizing M/s Southern Investments (P.) Ltd. (the developer) to undertake construction on 41.21 cents of jointly owned land in Kozhikode. Subsequently, through a settlement deed dated 17 August 2010, portions of this land were transferred to their sons, resulting in seven co-owners, including the assessee, whose share was 4.422 cents.
A joint venture agreement was executed on 04 February 2011 between the seven co-owners and the developer to construct residential buildings under a project named Rain Tree Heights. Under the agreement, the co-owners retained 26.09% of the land, while 73.91% (valued at ₹243.66 lakh) was transferred to the developer in exchange for constructed property. The assessee’s proportionate share was valued at ₹26.11 lakh. Both the GPA and the JVA were unregistered.
