COMMISSIONER OF INCOME TAX V vs. M/S REALEST BUILDERS & SERVICE

ITA - 706 / 2006HC Delhi09 May 20061 pages

For Petitioner: MR.SANJEEV SABHARWAL

AI SummaryPartly Allowed

What did the High Court hold?

The High Court admitted the appeal and formulated a substantial question of law regarding whether income accrues to the assessee only upon registration of the sale deed or upon execution of a tripartite agreement and receipt of full consideration. The Court heard the parties and allowed the appeal subject to just exceptions. The operative direction was to admit the appeal and list it for hearing after the parties file paper books within three months. The specific finding of the ITAT, which is the subject of the appeal, was that income accrues to the assessee only on the registration of the sale deed. The reasoning behind the ITAT's decision is not detailed in this High Court order. The High Court has not yet decided the substantial question of law; it has only admitted the appeal for determination.

What were the facts?

This case involves an appeal filed by the Commissioner of Income Tax (Appellant) against an order passed by the Income Tax Appellate Tribunal (ITAT) concerning M/s Realest Builders and Servic (Respondent-assessee). The assessment year(s) are not explicitly stated in the provided text. The appeal challenges the ITAT's decision regarding the timing of income accrual for the assessee. The procedural history indicates that the High Court admitted the appeal and formulated a substantial question of law. The amount in dispute is not mentioned.

What were the issues?

1. Whether the ITAT was legally correct in holding that income would accrue to the respondent-assessee only on registration of the sale deed in favour of a purchaser and not on the execution of the tripartite agreement and receipt of full consideration amount pursuant thereto? (Question of law/mixed law and fact, concerning the timing of income accrual under the Income Tax Act). Assessee's Contention: The judgment does not record any specific contentions made by the respondent-assessee before the High Court. However, the ITAT's decision, which is under challenge, implies that the assessee likely argued that income accrues upon registration of the sale deed. Revenue's Contention: The judgment does not record any specific contentions made by the appellant-revenue before the High Court. However, the appeal itself suggests that the revenue likely argued that income should accrue upon execution of the tripartite agreement and receipt of full consideration.

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF DELHI AT NEW DELHI . ITA No. 706/2006 . COMMISSIONER OF INCOME TAX V ..... Appellant Through: Mr.Sanjeev Sabharwal, Adv. . versus . M/S REALIEST BUILDERS and SERVIC ..... Respondent Through: None. . CORAM: HON'BLE MR. JUSTICE T.S.THAKUR HON'BLE MR. JUSTICE SHIV NARAYAN DHINGRA . O R D E R 09.05.2006 CM No.6590/2006 Heard. Allowed subject to just exceptions. ITA 706/2006 Admit. The following substantial question of law is formulated for determination: ?Whether the ITAT was legally correct in holding that income would accrue to the respondent-assessee only on registration of the sale deed in favour of a purchaser and not on the execution of the tripartite agreement and receipt of full consideration amount pursuant thereto.? Paper books to be filed within three months in accordance with the High Court Rules. . Post for hearing at its turn. . . T.S.THAKUR, J . . . SHIV NARAYAN DHINGRA, J MAY 09, 2006 ga

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