HIND CERAMICS PVT. LTD., ,KOLKATA vs. DCIT, CIRCLE - 10(1), KOLKATQ

This is an appeal preferred by the assessee against the order of the National Faceless Appeal Centre, Delhi (hereinafter referred to as the “Ld. CIT(A)”] dated 30.01.2024 for the AY 2013-14.

2.1. The facts in brief are that the ld. AO observed during the course of assessment proceedings, that the assessee has received lease rental charges from various parties for occupying the area within the 2.2. In the appellate proceedings, the ld. CIT (A) dismissed the appealof the assessee by observing and holding as under:-

“7.3 I do not concur with the contentions so raised by the appellant in view of the valid observation made by the assessing officer in the assessment order which are reproduced as below: The deed of conveyance between the Vendor (Forum Riviera Constructions Pvt. Ltd) all the intermediary transferee companies before the final sale of the flat was not materialised at any point of time. No actual sale/transfer took and/or registration of so called agreement between the assessee and the vendor (Forum Riviera Constructions Pvt Ltd, as per the Deed) took place, so the claim of capital gain of the assessee is not substantiated. The assessing officer noted from the Deed that Forum Riviera Constructions Pvt Ltd was actually entitled to undertake development of the housing project and in the last also when the actual sale of the flat materialised, Forum Riviera Constructions Pvt Ltd received the consideration from the payment of the purchaser in the Deed as Vendor. So, the overall control over the sale of the

4.1. The facts in brief are that the assessee paid an advance for purchase of flats from Forum Rivera Constructions P. Ltd (developer). The project was in progress during the year and the advance paid to 31st March, 2012 31st march, 2013 SL no. Particulars 1. Forum Rivera Constructions Pvt. ltd. 20,00,000 3,66,00,000 Sub-Total (A) 20,00,000 3,66,00,000 1. Beautiful Enclave Pvt. Ltd. 20,00,000 2. Nimidhi commercial pvt. ltd. 53,00,000 Sub Total (B) 73,00,000 1. Animesh Paul 1,60,000 1,60,000 2. Ram Chandra Trading 2,30,000 3. Baijnath Jaiswal 4,70,000 4,70,000 4. Dalmia Manav Seva Trust 16,22,554 5. Dalmia Shiksha pratishtan 1,10,45,724 6. Prashanth Paul 45,000 45,000 7. Ram Chandra Paul 4,59,000 4,59,000 8. Shakuntala Bojgaria 9,66,900 9,96,900 9. Susmistha Roy 2,60,000 Sub total (C) 1,50,29,178 23,30,900 Total (A+B+C) 2,43,29,178 3,89,30,900 4.2. Accordingly, the assessee was asked to explain why ₹3,46,00,000/- received from Forum Rivera Constructions P. Ltd. during the year and why should not be treated as concealed income vide order sheet dated 10.02.2016. The assessee also received ₹2,30,000/- from Ram Chandra Trading on account of sale of flat by 4.3. In the appellate proceedings, the ld CIT(A) confirmed the order of AO on this issue after taking into account the submissions of the assessee.

4.4. After hearing the rival parties and perusing the materials on records , we find that the AO treated the difference between amount received and paid for assigning the rights in the flats as speculative income u/s 43(5) of the Act on the ground that there was no physical sale of the flats. In our considered opinion the provisions of section 43(5) are not applicable to assignment of rights in property but applicable to commodities including stocks and shares and not to rights in immovable properties. The case of the assessee find support from the decision of CIT Vs Tata Services Ltd.(1980)122ITR 594 (Bom) in case of assignment of right in property the surplus/profit would be liable to capital gain tax. Therefore agreement to purchase

Order pronounced in the open court on 19.11.2025.