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Income Tax Appellate Tribunal, NAGPUR BENCH : : NAGPUR
Before: SHRI S.S.GODARA & DR. DIPAK P. RIPOTE
ORDER
PER DR. DIPAK P. RIPOTE, AM:
This is an appeal filed by the Assessee against the common order of ld.Commissioner of Income Tax(Appeals)-1, Nagpur dated 18.03.2013 emanating from assessment order under section 153C r.w.s143(3) dated 29.12.2010 for A.Y.2007-08. The grounds of appeal
raised by the Assessee are as under : Shri Pralhad Chodhary [A] “1. The learned CIT (Appeals) erred in holding that the capital gain arose u/s 2(47)(v) of Income Tax Act during the PY 2006-07 in respect of the transfer of the land mentioned in the agreement dated 14/10/2006
2. The learned CIT (Appeals) erred in ignoring the provision of sec. 17(1A) of the Registration Act, 1908 which mandates the documents not registered shall have no effect for the purpose of sec 53A of Transfer of Property Act.
3. The learned CIT (Appeals) erred in ignoring the condition mentioned para 3(b) of the agreement dt. 14/10/2006 where in specifically mentioned that no possession would be handover without payment of the full amount of sale price.
4. The learned CIT (Appeals) erred in not distinguishing the word possession & the word license. The word possession in TP Act & the word license in the Indian Easement Act, 1982.
5. The learned CIT (Appeals) erred in relying on the oral statement of the assessee and other co-owners as regard the declaration of income.
6. The learned CIT (Appeals) erred in relying on the decision of the Chatutbhuj Dwarkadas Kapadia of Bombay vs CIT [2003] 129 Taxman 497
7. The learned CIT (Appeals) erred in holding that provision of 17(1A) of the Indian Registration Act is not applicable for the purpose of Income Tax statue.
8. Any other grounds that may be taken at the time of hearing of the case.”
2. The ld.Authorised Representative(ld.AR) of the assessee submitted that his case is covered by the decision of Hon’ble ITAT in wherein identical grounds of appeal were raised by Shri Ashish Subhash Choudhary(one of the Co-owners). The ld.AR read out the relevant part of the ITAT Order.
2 Shri Pralhad Chodhary [A]
Ld.AR also submitted that rather the ld.CIT(A)’s order is common order in the case of all Co-owners. The Assessee appellant along with other Co-owners had entered into a Development Agreement dated 14/10/2006 with M/s.Gigeo Real Estate. The issue was whether any Capital Gain had arisen due the said Development Agreement. The ITAT held in favour of assessee.
The ld.Departmental Representative(ld.DR) of the Revenue relied on the orders of the Lower Authorities.
Findings & Analysis : 5. There was a Search under section 132 of the Income Tax Act in the case of the Shri Ashish Chaudhary on 13.01.2009. An agreement for sale dated 14.10.2006 was seized during the course of search from the residential premises of Shri Ashish Chaudhary vide Item No.7 to Annexure-B. As per the said agreement for sale, assessee along with Co-owners namely, Ashish, Mrs. Krishna, Praful, Prashant, Manoj, Jai, Deepak, Renuka, Priyanka, Sonali, Radheshyam, Ramlal, Shankutala, Dharamveer, Pralhad and Nisha had entered into an agreement 3 Shri Pralhad Chodhary [A] for sale with M/s.Gigeo Real Estate, Prop.C.K.Patel. According to the Assessing Officer(AO), assessee was liable to pay Long Term Capital Gain Tax with reference to his share in the impugned agreement for sale. Aggrieved by the assessment order, assessee filed an appeal before ld.CIT(A). The ld.CIT(A) vide his order dated 18.03.2013 decided the appeal of following Co-owners by one common order, Shri Ashish Subhash Choudhary & Others, Shri Manoj Jais, Shri Jai Jais, Shri Prafulla Jais, Shri Prahlad Choudhary, Smt.Priyanka Choudhary, Shri Deepak Choudhary, Shri Krishna Subhash Choudhary, Shri Radheshyam Choudhary, Smt.Nisha Choudhary, Smt.Sonali Choudhary, Shri Dharamveer Choudhary and Smt.Shakuntala Choudhary.
S/Shri Ashish Subhash Choudhary and Krishna Subhash Choudhary filed an appeal before ITAT Nagpur Bench against the impugned common order of ld.CIT(A) dated 18.03.2013. The ITAT in ITA No.156/NAG/2013 by a common order dated 24.11.2017 held as under: “5.2 In view of the clear cut dictum of the law pronounced by Hon’ble Supreme Court, as the agreement entered into by both the assessees along with other co-owners with the 4 Shri Pralhad Chodhary [A] builder were not registered therefore, the provisions of section 2(47)(v) cannot be applied in the impugned case before us during the impugned assessment year and consequently there will not be any capital gain arising in the hands of each of the assessee during the impugned assessment year as there will not be any transfer of the capital asset as stipulated u/s 45 o the Act. We, therefor, set aside the order of CIT(A) and delete the addition made by the Assessing Officer.”
Thus, ITAT Nagpur Bench in and ITA No.156/NAG/2013 vide order dated 24.11.2017 held that there was no transfer of any capital asset and hence, no capital gain. We have already mentioned that assessee is one of the Co-owners. The ITAT in ITA No.155/NAG/2013 and ITA No.156/NAG/2013(supra) had allowed the appeal of Shri Ashish Subhash Choudhary and Shri Krishna Subhash Choudhary who were other Co-owners with reference to the same agreement for sale dated 14.10.2006 entered with M/s.Gigeo Real Estate. This fact has not been disputed by the ld.DR of the Revenue. Therefore, respectfully following ITAT Nagpur Bench’s decision in ITA No.155/NAG/2013 and ITA No.156/NAG/2013, we hold that there was no transfer of the Capital Asset as stipulated under section 45 of the Act and 5 Shri Pralhad Chodhary [A] hence no Long-Term Capital Gain Tax. Accordingly, appeal of the assessee is allowed.
Condonation of Delay: 8. There is delay in filing of appeal. Assessee filed an affidavit, in that he has mentioned that the assessee has lost his leg and was bed ridden for five years. The assessee filed copy of Doctor’s Certificate and had also filed photograph showing amputed leg. In these facts and circumstances of the case, we are of the opinion that there was sufficient cause for delay, hence, the delay is condoned.