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Income Tax Appellate Tribunal, ‘A’ BENCH, CHENNAI
Before: SHRI N.R.S. GANESAN & SHRI ABRAHAM P. GEORGE
आदेश /O R D E R
PER N.R.S. GANESAN, JUDICIAL MEMBER:
This appeal of the assessee is directed against the order of the Commissioner of Income Tax (Appeals) – 5, Chennai, dated 22.03.2016 and pertains to assessment year 2011-12.
Shri N.R. Suresh, the Ld. representative for the assessee, submitted that the assessee executed a unregistered settlement deed in favour of his wife Mrs. Uma Devi Balasubramanian on 01.01.1998. In order to confer a title on Mrs. Uma Devi Balasubramanian more particularly, the assessee also executed a registered sale deed on 10.08.2010. In the sale deed, there was reference about sale consideration as if the assessee has received `50 lakhs from his wife. In fact, according to the Ld. representative, the assessee has not received any sale consideration from his wife.
The sale deed itself was executed only to confer title of the property more particularly. Since the assessee has already executed settlement deed, according to the Ld. representative, the sale consideration referred in the sale deed cannot be taken as such.
The assessee has not received any money from his wife. There was no entry either in the books of account or in the Profit & Loss account or balance sheet. On a query from the Bench, the Ld. representative very fairly submitted that there was no reference in the registered sale deed about the earlier unregistered settlement deed. Moreover, according to the Ld. representative, the Revenue could not unearth any investment made by the assessee to the extent of `50 lakhs. It is also not the case of the Revenue that the assessee had cash to the extent of `50 lakhs. In those circumstances, according to the Ld. representative, the assessment made by the Assessing Officer on the basis of the sale deed cannot be justified. The Ld. representative further submitted that an affidavit was also filed by the assessee declaring that he has not received any consideration on transfer of property. A similar affidavit was also filed by the assessee’s wife Smt. Uma Devi Balasubramanian that she has not paid any consideration for transfer of property in her favour by the registered sale deed.
Therefore, according to the Ld. representative, the addition made by the Assessing Officer cannot stand in the eye of law.
We have heard Shri Shiva Srinivas, the Ld. Departmental Representative also. The copy of unregistered settlement deed, available at page 47 of the paper-book, shows that the assessee settled the property in favour of his wife. Unfortunately, this is an unregistered settlement deed. The market rate of the subject land was taken as NIL in the settlement deed. Moreover, the assessee has retained the life interest over the property. Therefore, it is obvious that the physical possession of the property was not handed over to Smt. Uma Devi Balasubramanian. The assessee continued to be in physical possession of the property. The reason for declaring the value of the property as NIL appears to be that there was prohibition for construction of building by virtue of Coastal Regulation Act. Subsequently, the assessee executed a registered sale deed on 10.08.2010. There was no reference about the earlier settlement deed. Therefore, there was a doubt whether the so- called settlement deed executed by the assessee is in existence or it is a made belief story. If there was a real settlement deed as claimed by the assessee by way of unregistered settlement deed and the assessee executed the sale deed in order to confer the title more particularly in favour of his wife, there should be a reference about the settlement deed in the sale deed. Unfortunately, such a reference was not made. The sale deed specifically says that the assessee has received sale consideration of `50 lakhs by cash.
The assessee acknowledged the receipt of `50 lakhs in cash.
The question arises for consideration is when the registered sale deed acknowledges the receipt of `50 lakhs by cash by the assessee, can the assessee now lead evidence by way of affidavit for disproving the contents of the registered sale deed? This Tribunal is of the considered opinion that the assessee cannot lead any evidence for disproving the contents in the sale deed when the execution of registered sale deed is admitted. In the case before us, the assessee is not disputing about the execution of registered sale deed. The assessee consciously executed the registered sale deed by acknowledging receipt of `50 lakhs. Therefore, this Tribunal cannot go beyond the acknowledgement of the assessee in the registered sale deed.
During the course of argument, the Ld. representative also submitted that the unregistered settlement deed / registered sale deed was executed by way of family arrangement. No doubt, when there was a family arrangement, there cannot be any transfer of property. At the best, we can say in a family arrangement, the properties are divided among the coparceners or among the persons who have antecedent in the title over the property. In the case before us, it is not the case before the lower authorities that the unregistered settlement deed / registered sale deed was executed in the family arrangement. In fact, the so-called unregistered settlement deed or the registered sale deed does not refer any family settlement. Moreover, it is not the case of the assessee that the property in question belongs to Hindu Undivided family. Therefore, it is obvious that the assessee is the absolute owner of the land in question and no one else has any antecedent title over this property including the assessee’s wife Smt. Uma Devi Balasubramanian. When the assessee’s wife has no antecedent title over the property, the transfer of property cannot be construed as family settlement. It is also not the case of the assessee that the property is settled in favour of assessee’s wife for maintenance.
The matter would stand in different footing in case the property was transferred in favour of the assessee’s wife for maintenance. It is an outright sale of property as disclosed in the sale deed.
Therefore, the claim of the assessee that the property was transferred by way of family settlement has no merit at all. This Tribunal is of the considered opinion that there is no family settlement at all. It is an outright sale as disclosed in the sale deed.
In view of above, there is no reason to interfere with the order of the lower authority and accordingly the same is confirmed.
In the result, the appeal filed by the assessee stands dismissed.
Order pronounced on 23rd September, 2016 at Chennai.