DCIT Vs Vishnubhai Vithalbhai Patel (HUF) (ITAT Ahmedabad)
Transfer Only on Sale Deed, Not on POA- No Capital Gains in AY 2012-13: ITAT Ahmedabad
Assessee, a HUF, sold agricultural land (Survey No.934, Village Unvarsad, 2,428 sq.mtrs) in two parts to Uttar Gujarat Bargam Kavda Patidar Samaj- First part (1,365 sq.mtrs) transferred in AY 2010-11 & Second part (1,063 sq.mtrs) transferred in AY 2012-13. Transfer was done through irrevocable General POAs (21.07.2010 & 28.03.2012) against consideration of ₹7.75 lakh & ₹37 lakh. Assessee declared STCG of ₹32.34 lakh in AY 2012-13.
AO rejected assessee’s stand, relying on Suraj Lamp Industries (SC), that POA is not a valid transfer of title.
Held that transfer took place only when registered sale deed dated 19.04.2012 was executed. Applied section 50C adopting stamp value₹1.66 crore (instead of ₹44.75 lakh actual consideration). Computed STCG of ₹1.23 crore in AY 2012-13 & added to income.
CIT(A) held that if AO himself accepts sale deed dated 19.04.2012 as transfer date, then capital gain arises in AY 2013-14, not 2012-13. Transfer through irrevocable POA is also covered by section 2(47)(vi) (transactions enabling enjoyment of property).Accordingly, addition in AY 2012-13 was deleted.
ITAT’s Findings
On date of transfer: Once AO accepted sale deed dated 19.04.2012 as transfer, capital gain is taxable only in AY 2013-14. Hence, no addition can be made in AY 2012-13.
