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±±m±apzEEEEEELE=LtTtEIT IN THE INCOIVIE TAX APPELLATE TRIBUNAL PATNA BENCH, PATNA ch FEritr ri, fflifatF HaH ri ch uiT.tPr.HIS, aTFT qi=F[:I aT FTH I BEFORE SHRI CHANDRAMOHAN GARG, JM AND SHRI L.P. SAHU, AM 3matF{ 3Ttha ri.7iTA NO.261 7pAT72Oi 8 (frfual/Assessmentyear\:2015-2ol6)
Pffitlcka/Assesseeby Shri Abhinandan Kumar, ARShriAbhayKumar,DR tTRI rfu 3ir a /Revenue by 27/06/2019 5at fl alitF / Date of Hearing tin EPr FTife7 28/06/2019 , Date of Pronouncement
QT / 0 R D E Ef¥r Ben± This appeal is filed by the assessee assailing the order of Commissioner of Income Tax (Appeals)-1, Patna, dated 09.07.2018 for the assessment year 2015-2016, on the following grounds of appeal :- 1. E.Pr that ld. PIT(A)_erre_d_!n treating the sale proceeds of three f!£t_s.aLp_Ou..n_tLirgtoRs..975ooo.Ooi:pftheyea;.idri5ri;6t-ir;i=-ct-s that tpe fl.a!s _w_e.r_e .given possession in-the ;e;i --=a5:i=:rf-i;t y^e^a^r^i:=:_A.i_20L]_9-17apdthesamevyereaccountiJi6;-i;-tits assess.pe . in. the..next assessment year and taxes-`wii;e 2. aF;o^C::Ir_hd:_nt.gt!hyLe_d_;gf S_;Ad),}hyatshe?sat;#f;come @| o% ;f-th:-:;e r^a!u.eo^ffth£.efl,atAs.%ft^e!^rpjec_t!n_g.bpoksofAi€:ir.i{idrJt-;Iirofrirg lpss_Lpf _ ,.Rs. 14,30,943i coirEsisting Of =awii;i.it;=tirJ;..:ffd construction expenses. 3. F_o_r.tps!_!P_S_|q. CIT(A) had erred in not allowing administrative 4. aFnaod:bctf naf t:rhu£C:!°dr:_ec_;_FfI_)Se£;±_d ip a.ot cops.|deri;g-t-;:-.;:-;::i.t:d taxes on the income from of these thr6i--float:.in-irhr;-;a;t
a ITANo.26l/PAT/2 ?hs=essasmmee:ntcyoema:i.e.A.Y.2016-17asitwilldoubletaxationfor 5 tEoe;r:taph#nncj°o#heer groun:-::; :: :a®::dw:tat°hueDt],emteaxo:t;°enafr:g Of appeal. 2. Brief facts of the case are that the assessee is a Private Limited Company deriving its income from the business of Real Estate Development. Return of income or the assessment year 2015-16 had been filed on 04/03/2016 declaring a loss of Rs. 14,30,943/-. The case was selected for scrutiny and in the course of scrutiny assessment, the AOtreatedthesalesproceedsofthreeflatsamountjngtoRs,97,50,000/- and also adopted 10°/o of the net profit, against which the assessee appealedtotheCIT(A)andtheCIT(A)jnappealupheldthefindjngsofAO anddjsmjssedtheappealoftheassessee. 3. Now, the assessee is jn furtherappeal before the Tribunal. 4. Ld. AR submitted before us that the assessee had already shown the income from sale of three flats jn the nerd assessment year 2016- 2017 and had accordingly paid the taxes on its before the passing of assessmentorderu/s.143(3)oftheActforA.Y.2015-2016.However,the CIT(A) relying on the provjsjons of SectjQn2(47) of the Income Tax Act r.w.s.53AI54oftheTransferofPropertyAct,fajledtoappreciatethefact thatthesectjon2(47)(v)oftheActspeaksabouttransferofpossessionof' the property. Accordingly, IdE AR prayed for allowing the appeal of the assessee.
: ;ftnetrh:e°atr::: :::d:::h :h: rs:::: :::hcea:::u:[r; ::rauust]hn°gr[::ees ::'t°e:a[ avajlableonrecordalongwjththepaperbookfiledbytheassessee,we
a ITANo.26l/PAT/2018 find that the AO in the assessment proceedings noted the assessee had to disclose its sale consideration in its account in the year under consideration, as the assessee had already received s`ales proceeds from these flats on the date of execution of sale deed which too have been exec'uted during the current year. Further the AO estimated the net profit
@10% of sales revenue and as the net profit has been determined on estimate basis on total sales revenue after invoking the provisions of section 145(3) of the Act, the AO did not allow the loss shown by the assessee in the profit & loss account and the return. In the appellate
proceedings, the CIT(A) placing reliance on the various judicial pronouncements observed that in absence of any provision to the contrary, the concept of sale of an immovable property which is included in the express "capital asset" as defined under Section 2(14) of the Act, hastobegatheredfromSection54oftheTransferofPropertyAct,1882. FinaHy,theCIT(A)heldthattherewouldbetransferof\flatcoveredbythe three sale deeds in question during the period under consideration making the assessee liable for payment of taxes in the previous year relevant to assessment year under consideration. Ld. AR before us submitted that since the possession were not transferred to the
purchasers during the A.Y.2015-2016, therefore, the sales of the three 1 flatswereshownintheA.Y.2016-2017.ItwasfurthersubmittedbytheLd. ARthatthesaidthreeflatsownerweregivenpossessionintheF.Y.2015- 2016 and therefore sale amount of three flats were accounted for in the A.Y.2016-2017 and taxes were deposited accordingly. During the course
a ITANo.26l/PAT/2 t_he same iniome. Fhs=essasmmee:#cyoema:.i.e.A.Y.2016-17asitwilldoubletaxationfor Fo;ratphpa:a;.nyOthergroundmayberaisedatthetimeofhearing Of appeal- 2. Brief facts of the case are that the assessee is a Private Limited Company deriving its income from the business of Real Estate Development. Return of income or the assessment year 2015-16 had been filed on 04/03/2016 declaring a loss of Rs. 14,JO,943/-. The case wasselectedforscrutinyandjnthecourseofscrutjnyassessment,the AOtreatedthesalesproceedsofthreeflatsamountingtoRs.97,50,000/- and also adopted 10% of the net profit, against which the assessee appealedtotheCIT(A)andtheCIT(A)jnappealupheldthefindjngsofAO anddjsmissedtheappealoftheassessee. 3. Now, the assessee is in furtherappeal before the Tribunal, 4. Ld. AR submitted before us that the assessee had already shown the income from sale of three flats jn the nerd assessment year 2016- 2017 and had accordingly paid the taxes on its before the passing of assessmentorderu/s.143(3)oftheActforA.Y.2015-2016.However,the CIT(A)relyjngontheprovjsjonsofSection2(47)ofthelncomeTaxAct r.w.s.53AI54oftheTransferofPropertyAcI,failedtoapprecjatethefact thatthesectjon2(47)(v)oftheActspeaksabouttransferofpossessionof` /
the property. Accordingly, ld. AR prayed for allowing the appeal of the assessee.
; ;f:etrh:e:tr|:: :::d:::h :h: rs:::: ::dthcea:::u:[r; ::rauustfhn:rf:lees ::'t°e:a, avajlableonrecordalongwjththepaperbookfiledbytheassessee,we
tb ITA No. of hearing, the Benchaskedtheassesseeastowhenthe registration was done. In reply, theld.ARoftheassesseesubmjttedthattheregjstratjon was made in the financial year 2014-2015 and the possession was handed over jn the next year. From the orders of both the authorities below, we find that as the assessee has failed to disclose the sale _ `` '`, \JCIIC consjderatjon of flats in the books of accounts in the impugned year, therefore,theAOhasright'yinvokedtheprovjsjonsofSectjon145(3)of theActandmadeestjmatjon,towhichtheCIT(A)hasstampedwjththe vjewoftheAO.Inouropinjon,boththeauthoritieshavetakenjustand plausiblevlew,whjchcannotbejnterferedwjthOurviewalsosupportby thedecfsionofHon'bleSupremeCourtjnthecaseofCITVs.BalbjrSjngh Majnj, [2017] 86 taxmann.com 94 (SC), wherein the Hon'ble Supreme Court has held as under:- a.:;^f^:sa_,_soon,.:e:,.S:::;dftahnadttchaenporno,tvec#aonr^p^r_o.v.,_d_:qundersect.,on 5d;ebf^e+;s^c_e::fy!aaii!:i,-ie:t;ad;,::a:,epornoffh;nf;eonf:;:i;:;^rfvJ:ddfLdtpu.na:e:sr:gcht:o:, ds;:f:e:fl::;ne_.5§r;3i::*e:i;er:e;::;e=d:lteo°n#e:.Icbahveaffu;I,fi|^;.erfdf!ffite°.,;nsi-raijigih;;sV:!ff jnoS^r:.:eFofjat.T,hdj-S;;iw;s:ii;%;e5wnuad:::D:;finegAxe::Cu!be^yd^tAthh::uRgehritir-a:tiS:t-era:ndd i:nsc+ttL:°^u;meg.¥hiiss;i;givs;jiqouij`re;daafcoc:hena'ncennxae;cu:ftf:'!e!tLht_rhoeu_gjhn?arerd:g£!{tserve:i °Ttfrdde:_§eS:adn:Lodruirsi;.fj#seev:;§o:nec5nn3;:#h:ff+h2bboyTo}f_e££f§egnjgs*%nurae rna.:fd::^sS^:^ffu:i:asne,°7:S!yn!;.;;i':ff::tc;5;3J#;dc!t;thn2e°Df:]aiT^ff.fir;;:#.%;t:rfrfet aahnfaodrss^se~aft_ilo_an_:p'n7q::nnJt.,i9h`::;:Sde.s#h°d!atf^enR§^§!P:;fr,eaLtri_o°:;Aft[:rfiyfih:`e abf,:orb:3Sga!sd_t.e;rgde,ndpfs;;ntribeeue;n:r;deesa.,''s§fhap:raancrionR!;,ag!;_:rtSht.:°u;ghAi:;iEj'::i;t=o bi;h8^8re2;f^Sct:e^:eadferi;a:::;;°!t!i;;e::n:'##;tffe;rnecad°:::;r:;it;_:s±e;put.#ohn;5;3qi'roefJ;t-hoe `Lhf^e8^2.!A5f8!,aktbiisan;:`mj:feecn3'.f#fusftedaren;ried6u^o:r!y.,;n:.3_scft::,.,ffsn-,5fia[;d;f"4:;uoe, tfi_u'_:of_8T_t.:oc:tahi-in;g`'t`;::e-nuc:%e:;[dfenndf:ucn;-!!rjj;n_cg_tiotnhsat,-i;ajjeJs`s4;;i,e 'go3r,Oat;:a:be;de:_?tr_°sP.he.art,i!;o:t:tihaue;FF!Cp;ov[s°eetff:a;.n:tsef:ent;o;:°,r.:C3°rLS§fdfe!itff:i):%s 7r£%#.oSbearnbb±ecp;,:#_ap;i;fytfit§hr.#eon:t,§a;e#at§rfan§3e§fin5;#nno7E#_Stfd,:^jgfg;Sos;vgh#ej rreoegr!?i;.%bd,;s:t^e_i:fd_aelin?he;t:;;i:vc:oun:!nauycs[e:nffo:acs:eu;#narwf:a:!hflt:_r,_Pfidragivci!;jsg roeDrcffe^:;s:_dejva!:eenv:deeno;;a6nf;;c:ijfa:tr:::C:,:n;reaacn:.u!f^!;^ar_Ws'p_e;;#fifcrptehrfao;riff::;i9e °erffeacsteedvffeancreegfsfteare;dy:,n;£!':::;#e:::I_;;aapnassru£:tc,tt°fo;nspneoctjfirceqp:j#e°drwitai;;fee e_ffectedbyaregi-itch:5i;sut';au`##:t.t%:aac,t§C] T`,h:de:SLffe^encc;S?tnht:ofaft°hreesAa#e:##::tmAerntt:;!h^a^t:O.Pandafterthe ?:nk:§hffeebn^Jct§f;_nn!th;ef;;re;jiniicnuaJ!i,:jnus:;Aeofnt[re!n;;.rthoaa!!i;°ifLa_ap!d3gar:ee_::hn€t, !#;o;r:^hff^ee_cJt_?_nf,.:nri.ko€ririeispe%:'pCC::susefe:§f[=sft,Cttr;e^°gnfisE£.e°r;e`4:_jtfh;±n-i-fgs;h::5rih::;vGt6 naogreeffee%tejnnt,janwthfoer:hEo;f;fraoa##fcnshoe;cfrjenogn;s^5t:^ffdjn_t_:;I::v§hirej:{Fs:;j6o agreementintheeye:-i;i;;;hui'c.h%:'n°nbe°3eA;f:nrcsehd°:;#heerr=:5;I;°n
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Twh!Sfe%rrieass::bna,C.aT^n.O^t.b:_S!r^e!C.hedtorefprtoanamendmentthat rveeg!Stt%tj°a:a::.£aa%n!:ancrtaj.S.f^e^qu,.I^;P?jb_;!jhi-A;.i;!dfeypt.;a;o.;'%r+, r{eaas,.st#aat:oenyo%rs.n#rear^+jT.r2b°^P|:^30L.Pi;jt-i.i-hi;..-s=;.';hF:;5;#o.:ga; ¥5£3tAt,h\:,A:,f°Hr==as!d^Le^:.Pr.e_i_S!o_n_._.'of,irf;;irir8'.;5;ue';;e-J`t£.,:nu'sfe:t#:; Fn3A£'a:,:nu!dFS.ohms.!h3jLr.:I_e.I.3n±I.y_t;-.iii.;ir;re.:;-::n;ra.:t':es%u::°end i:a=£echtf°ann5.3t£;a:h!CLh^`y^ou!F_t_rf_err_i;-t-u.r.;`;3rrv:qvu;;:'rae.;i:;'rea't'j`:°n:eAas hfnarsne±e,%H=trat.ebd^+:^bn°VEe=^thsre;:!-S:;^i^-..i6;tir=:ii:''tch:8S'ao`;a,na:jsn fr°Q:n=RtaurnadrierThs£.Ctf°^Tn^5,5LA__a_ft_e_;-ib§1:-i;I.:sV±`;;:''5sa;dyecou:t'raa:t':s r%.'sst:::,d=rTrffs;.S:!n^galth_3_SSSL£_,aidj-!tFii;i-c|€grt-h%tuti:eu'::;aduJrfA 'tahwe'a°f:::°.u£;!yrdn:O^.'.tr3^n_S,ferca;ii-:;i.i-t;'ia-;:Utaa%;''p;':=e%%Tr r:aaws.noebvv;:,:a,gysntehrst:=ns!fn^Cr:^t^h.eLJP4_I_f?-ni-5faldy.i';t;=`ueff=f the aforesaid dbcument.
trhfarcaa2Sne,'thereis-noneedt6-d6.i'n.t-o.:;;.:tahue.r5Fa:;::,'eqTuaecstt;o°:. #scenas_€uab-Ct'haaursbe..!V)n3f_S_e_CtgoLn_2_(47.)i.Snotattractedonthefactsof [Para 20] Ha°D:,evvfe%t#he:raHr.g^hn8h°^u+TLh^S_S..I_e!d__!ha.tsectipn2(47)(vi)wi||not aspopc'jyetfv°_r:hsenrnen:=°mnn:.h+abtAthe^r_e_W_ai:_-fi:dii;irS';;:mcp\-m'b':r:h#p'':fat:te St°hf:e.:y.'n:arc,?nn:e.:P.I^a!£d::O.n,5.:-isi:t-=iay;;'{5h`8`WHfiff'3o°uTrf[noen teh#e:tc°%e;raunn.Saerrr:Sne^Ct!?n__2_(±i!_i_i-ij..,.-=n-;..t-r-a;:'::I;:nG#hui':huh°:sltt°hne eDff=Cnteri°fvt\r^%,i,frier:^n£^Or,.S.nLi_bli:!jd-'th=..:n;diyift`Uo'f'awn';Ui':%Svatnb;e Pard°vpe:rf%riYn°u,'hdacb°vmn3^^W^j:t_h!n,!It_:I__Puivii;.:'ii;:"nd8ha'do::I;uav:aF:oet asduvbe.%:,.:°a}S,:=^fhp;r^eLSS.i:^!.,'.Or:.:_;_;;;,iitrp.;:I-in:;::ruwuhu:t`s:eavse:P,tn Struab:=:acut:Den(rvf)f=r%hfj^Chth:OTl^d_SLh_a_i:.!'Pi{:i{-i.s'';uo't'':%'c:::%`F5hvaetrt:ne ttrhaenrseafcot:e°.nnree:ear.sS.s:°rvthtnefaegiv^jfijiLh-ji.-iLf.:a`:`:_i_:;::Cat;ivq.esss%:fya.[|ttnj€s, tfha;,rewf£:;;tnh:_=ensrsn:,%:O::ref;.ji^;Ai.;:rJ;ea-,`mupuupgG:ea:terasn°sC:=t%:n't:'=; fall within this provision. [Pari-i:1`] T,he##eec:a°%ns?rc:jn°.nfa2r(4^:)!V..'`).9_PP_e_ars.t.Obetobringw.Ith.Inthetax netadefactotransfer`of'=nji-rfffdr;5diivewife`pue#;'.'9Thw:Lne[xnp[rneess[;aoxn
~` ITANo.26l/PAT/2018-a 'Frnaanbs]!ne:rjtnha:=£n!°tyhT+e#+t;=f^:f!=S,LC_OLlo_u_rfTomtheparlierexpression tF.rhaens:en[:vn#=nst6:fa;t:t:^s„c±,i;ail_h_.F{_.drF;.t;:;::cptfo%„#,hjecxhp:ensas:%ns t::rDeonk%mne"n,tnaorft!mbT^o^:abg,fi_i;i_-p_:i;.`#;'s.!au;='lni:ffeenfaaD:esa Fruarnpsoarfcet#onos:n3:a::p=ret3f„:hhe;..js^:=j_i.t±;._.fy;.yjfi;,i,n{yt,#,ee,;,axasneat, ttrhaenrsea:st:?nns=u%sht=rne:atha°tur9nh:+tfit!;^jiir`;fof{"rue.itvr'::I:_;¥:=d[?Xn:ae#, there is, in substance, a trgns{€;-o; i'itfr: i;Vf=c;.e[;#r:SZ:2;]`i Since in the impugned case, the property has got registered in the financial year 2014-2015, therefore, the assessee should offer income in ' thecurrentassessmentyear,whjchhasnotbeenshownbytheassessee.
Respectfully following the decision of the Hon'ble Supreme Court jn the case cited above, we uphold the findings of CIT(A) and dismiss the appeal of the assessee. 7. In the result, appeal of the assessee is dismissed. Order pronounced in the open court on 28/06/2019. Sd/- Sd/- ETfaH Hfprj[uGDfcFA:JMEMBER a" H±+.ApcT:uOAjHTUA'NT MEMBER qEE]T/Patna; ffro Dated 28/06/2019 IT.F.ftr/PKM, sr.p.s.
mltEEEETEiEIHn.HTEHEETPIEm]mPIITHHRlItH Jalalpur Developers Pvt. Ltd., At-Badi Badalpura, Khagaul, Patna-801105 2. RT#/The Respondent- 3. A#°#(#d/-i(h`e):[Ei+|a 4. 3mtFT3TTap7clT 5. frrmHfafrm, drRE5Trmorfro, qtffl7 DR, ITAT, patna 6. JTT€rty/Guardfjle. diTa3Tgr/ By ORDER, HFqifinqia/ITruecopy+t
(Senior Private Secretary) 3TRE513Tth 3Tffu, qEaT / lTAT, Patna