Stock-in-trade transfers in the year in which sale deed gets executed

Shri Challa Ramakrishna Vs ACIT (ITAT Hyderabad) According to the CIT, the capital gain has arisen in the relevant A.Y because the assessee has entered into a joint development agreement (JDA) with M/s. Sri Sai Developers to develop the land which has been converted from capital asset into stock in trade during the relevant financial year. As per section 45(2) of the I.T. Act, where a capital asset is converted into stock in trade, the capital gain would be taxable in the year in which the stock in trade is transferred. Undisputedly, the joint development agreement has been entered into in the...