Case Law Details
Smt. Sabita Devi Agarwal Vs ITO (ITAT Kolkata)
In the present case, assessee who was owner of 1/4th share in a residential house, had transferred the asset by way of registering a general power of attorney in favour of purchaser. The registration of the sale of said property had not taken place. AO invoked the decision in the case of Suraj Lamp & Industries Ltd. vs. State of Haryana; 340 ITR 1 (SC), and held that registration of general power of attorney could not convey the title nor did it tantamount to a valid mode of transfer of immovable property. AO denied the claim of exemption u/s 54F as at the time of exemption assessee was already in possession of two residential properties i.e., a house in Gurgaon and a penthouse. Tribunal held that the judgment of the Supreme Court was prospective and did not affect transactions that have already taken place. Even otherwise, section 2(47) laid down that transfer would include a transaction allowing possession of an immovable property in part performance of a contract of a nature referred to in Section 53A of the transfer of Property Act. In the case on hand, part performance of a contract had taken place and possession had been handed over. Thus, the claim of exemption was to be accepted as assessee had only one house property as on the date of sale of the plots of land giving rise to long-term capital gain.
FULL TEXT OF THE ITAT JUDGEMENT
This is an appeal filed by the assessee directed against the order of the Learned Commissioner of Income Tax (Appeals) – Siliguri, (ld. CIT(A)) passed u/s. 250 of the Income Tax Act, 1961, (the ‘Act’), dt. 11/04/2016, for the Assessment Year 2012-13.
2. The assessee is an individual and derives income from business, capital gains and other sources. During the year, the assessee sold two plots of land at P.S. Maligore, Dist. Darjeeling, bearing deed no. 12646, measuring 19 kathas for Rs.95,00,000/- and another plot of land bearing deed no. 12464, measuring 1 katha, for Rs.5,00,000/-. The total sale consideration received on sale of these two plots was Rs.1,00,00,000/- (Rs.One Crore Only). The assessee claimed that there was a typographical error in the computation of income, inasmuch as, the purchase of a plot of land was wrongly reflected as purchase of flat. The Assessing Officer disbelieved him on the ground that the alleged mistake that was sought to be rectified was after issual of notice. The said plot of land was purchased for Rs.32,40,000/-. Enquiries made by the Assessing Officer through the inspector revealed that the plot of land is vacant. After considering the replies of the assessee along with evidence that she had entered into an agreement with M/s. Hill View Builders on 20/06/2014, for construction of phase one of her residential house on this plot in Darjeeling and that she had already paid Rs.20,01,000/- to the said developer M/s. Hill View Builders, the Assessing Officer came to a conclusion that this agreement and payments cannot be believed for the reasons given in his order. He rejected the claim for deduction u/s 54F of the Act, for Rs.52,40,000/- made by the assessee.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
