Smt. Shree Jain Vs ACIT (ITAT Mumbai)
In the case concerning reassessment and taxation of capital gains, the Income Tax Appellate Tribunal (ITAT) Mumbai examined the validity of reopening under Section 147 of the Income-tax Act, 1961 and the taxability of short-term capital gains arising from the sale of land. The assessee had filed a return for AY 2016–17 declaring minimal income, which was processed under Section 143(1) without scrutiny. Subsequently, the assessment was reopened based on information that the assessee had executed a registered sale deed dated 07.08.2015 for ₹8.96 crore but had not disclosed any capital gains. The Assessing Officer (AO) computed short-term capital gains of ₹4.56 crore, noting that the property was held for less than 36 months and that TDS had been deducted and reflected in Form 26AS.
The assessee contended that no consideration was received, the transaction was ineffective, and gains were later offered in AY 2019–20 upon receipt of flats. However, both the AO and Commissioner of Income Tax (Appeals) rejected these claims, emphasizing that the registered sale deed acknowledged full consideration and transferred ownership rights. No cancellation or exchange deed was produced, and the assessee had not refunded TDS, indicating completion of transfer.
