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Department represented by Shri Vinod Kumar, Sr.DR Assessee represented by Shri Saurabh N Soparkar, Senior Advocate with Ms. Ukti Shah, Advocate Date of hearing 13/07/2022 Date of pronouncement 13/07/2022 Order under section 254(1) of Income Tax Act PER: PAWAN SINGH, JUDICIAL MEMBER: 1. This appeal by the revenue is directed against the order of learned Commissioner of Income Tax (Appeals)-2, Surat (in short, the ld. CIT(A) dated 26/02/2020 for the Assessment year 2013-14. The revenue has raised following grounds of appeal: “1. Whether on the facts and in the circumstances of the case and in law, the learned CIT(A) is justified in deleting the addition made by the AO of Rs. 1,96,03,090/- on account of Long Term Capital Gain holding that the ratio of apex court's decision in the case of Balraj Vs CIT(254ITR 22) Del would apply in this case wherein the date of transfer has been considered as agreement to sell date and not sale deed date, ignoring that in this case no transaction was carried between the purchaser and seller consequent to the purported agreement as well as the case law relied is born on DCIT Vs Balvantbhai Dullabhbhai Patel different sets of facts U/s 54 of the IT Act and quite distinguishable from the facts of the present case.?
2. Whether on the facts and in the circumstances of the case and in law, the learned CIT(A) is justified in deleting the addition, ignoring that if the assessee has actually relinquished his right on the property in A.Y.2011-12 in spite of stay by court, he had to establish as to why he had not received the sale consideration in the said year, in spite of no stay for transacting the payments by the court, when in fact the payments against the sale were received in A.Y.2013-14 by which it is clear that the transfer took place in the A.Y 2013-14 ?
3. It is therefore, prayed that the order of the Ld. CIT(A) may be set aside and that of assessing officer may be restored to the above extent.
4. The appellant craves leave to add, alter, amend and/or withdraw any ground(s) of appeal either before or during the course of hearing of the appeal.”
2. At the outset of hearing, the learned Senior Counsel Shri Sourabh Soparkar submits that the grounds of appeal raised by the Revenue is squarely covered by the decision of the Tribunal in assessee’s brother case i.e. in DCIT Vs Shri Hintendra Dullabhbhai Patel for the same assessment year in & 227/Ahd/2017 dated 30/07/2021 (AY 201-12 & 2012-13). The ld. Sr. Counsel further submits that the ld. CIT(A) while granting relief to the assessee had followed the decision of his predecessor in assessee’s brother case dated 28/02/2017. As submitted the decision of ld. CIT(A)-4 in assessee’s brother (co-owner) case has been affirmed by the Tribunal by holding that the capital gain offered by assessee has been taxed in A.Y. DCIT Vs Balvantbhai Dullabhbhai Patel 2011-12, and that the transfer of asset took place in AY 2011-12 thus, the grounds of appeal is squarely covered in favour of assessee.
3. On the other hand, the ld. Senior departmental representative (Sr-DR) for the Revenue after going through the grounds of appeal and the decision of Tribunal in assessee’s co-owner case in 227/Ahd/2017 dated 30.07.2021 submits that he relied upon the order of Assessing Officer.
4. We have considered the rival submissions of both the parties and have gone through the orders of lower authorities. We find that on similar set of facts in assessee’s co-owners case in ITA No. 226& 227/Ahd/2017 dated 30/07/2021, this combination has passed the following order: “21. Now adverting to the appeal for AY 2013-14. The assessing officer while passing the assessment order for AY 2011-12 withdrew the LTCG and directed to tax it in AY 2013-14. As noted above the assessee filed detailed written submissions before Id CIT(A) for justification of offer of LTCG in AY 2011-12. The Id CIT(A) on consideration of submissions of the assessee find that held that as per section 2(47) any transaction involving allowing possession to be taken or retained in part performance of a contract of the nature referred in section 53A of Transfer of Property Act would come within the ambit of section 2(47). It was also held that in order to attract section 53A, the conditions is that the contract is in writing , it should be signed by the transferor, pertains to immovable property and the transferee should have taken possession of the property and he is ready and willing to perform his part of contract. The Ld. CIT(A) held that main agreement and evidence for binding the parties is the partnership deed, which contains the signature of all the parties of seller and purchaser and consideration is clearly discernible. The possession of the land is with 3 DCIT Vs Balvantbhai Dullabhbhai Patel the Firm is also evidenced by the partnership deed dated 01.11.2010 and initial payment as per the sale deed is in October 2010.
Before us the ld CIT-DR for the revenue vehemently submitted that no performance of transfer of land in AY 2011-12 and that the sale deed of the impugned land was executed during the period falls in AY 2013- 13. However, the learned Senior Counsel for the assessee while explaining the fact submitted that assessee along with his seven co- owners of land during the assessment year 2011-12 by mutual agreement to Rajkumar Karamshibhai Ravani and eleven other parties on 25.10.2010 for consideration of Rs.6.05 Crores. Raj Kumar Karamshibhai Ravani and other co-owner of said land introduced the land to their partnership firm through partnership dated 08.10.2010 for a sale consideration of Rs.6.05 Crores and another remaining area of 8653.50 sq.mt. was introduced by assessee and seven other co- owners as capital introduction in the partnership firm, M/s DRB Ravani Developers. The land value recorded in the books of account of firm was Rs.60,576,000/- and the assessee's share be 12.5% was Rs.75,72,000/-. The total land contribution by or twenty partners became 17307 sq.mts, on which project of "Callestrial Dreams" was started and that all the co-owners had duly paid tax on the sale of land in A.Y 2011- 12.
We find merit in the submissions of the learned Senior Counsel for the assessee as the DRB Ravani builder stared project on the land introduced by the assessee and his co-owners and Ravani family. During the search the partner of the DRB Ravani Developer undisclosed income of Rs. 4.50 Crore and paid due tax on the said discloser. The revenue accepted the discloser and accepted the tax in assessment order dated 22.03.2013. DRB Ravani Builder also had shown the land in their books of account, which is neither doubted nor disturbed by the revenue. Further all the co-owner of the assessee also offered similar Capital gain in AY 2011-12, which was accepted by the revenue. The revenue has not made re-opening of any of those co-owners, which has attained finality. Thus, in view of the aforesaid discussions, we accept the submission of the Id CIT(A), in addition to affirm the order of Id CIT(A) on this issue.
DCIT Vs Balvantbhai Dullabhbhai Patel 24. So far as objection of the Id CIT-DR for the revenue that the sale deed of the impugned land was executed during the period falls in AY 2013- 13 and that the assessee cannot choose the year of taxability as per his choice. Considering the facts that the revenue has accepted the capital gain in the hand of other co- owners in AY 2011-12, the possession of the land was handed over or 01.11.2010, the land was introduced as capital contribution in the Firm. The Firm started its development activities and offered income for taxation. The assessee received part consideration in AY 2011-12. Further, the assessee am his co-owners were prevented from executing the sale deed in favour of the purchaser, due to injunction of Civil Court. Thus, the land was substantially transferred to the purchasers in AY 2011-12.
In the result the appeal for AY 2013-14 is dismissed.”
Considering the aforesaid decision of the Tribunal and the fact that the ld. CIT(A) while granting relief to the assessee, followed the order of his predecessor in case of Shri Hintendra Dullabhbhai Patel (supra) which has already been affirmed by the Tribunal vide order dated 30/07/2021, therefore, we affirm the order of ld. CIT(A). Hence, we do not find any merit in the grounds of appeal
raised by the revenue.
6. In the result, this appeal of the Revenue is dismissed.
Order pronounced in the open court on 13th July, 2022 at the time of hearing of this appeal.