Sandhyaben A. Purohit v. ITO - Taxpublishers.in

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The Tax Publishers2013 TaxPub(DT) 1560 (Ahd-Trib) : (2013) 053 (II) ITCL 0118 : (2013) 154 TTJ 0514 : (2013) 087 DTR 0042 Income Tax Act, 1961 --Capital gains--Transfer under section 2(47)(v) Transfer effective whether from date of execution or date of regulation of sale deed--Assessee executed a deed of sale on 21-5-2001. The possession of the property was handed over on the same day. The consideration of sale was received party on 30-4-2001 and balance on 23-5-2001. However, the sale deed was registered on 30-7-2003. Assessing officer was of the view that transfer under section 2(47)(v) took place on 30-7-2003 and taxed the capital gain on sales of the said property in the assessment year 2004-05 assessing officer also adopted market value by invoking section 50C. Commissioner (Appeals) concurred with the views of assessing officer. On appeal before the Tribunal, assessee submitted that assessing officer wrongly held that transfer took place in assessment year 2004-05 merely on the basis of date of registration whereas transfer is effective from date of execution of document. *Held :* In view of the decision rendered in Chaturbhuj Dwarkadas Kapadia v. CIT 2003 TaxPub(DT) 1029 (Bom-HC) : (2003) 260 ITR 491 (Bom), wherein it was held that in a situation where consideration had been paid and the possession had been handed over, then in view of the provisions of section 2(47)(v) transfer took place and that date of transfer was thus required to be taken for the purpose of computation of capital gain. The capital gain was required to be assessed in assessment year 2002-03 and not In assessment year 2004-05. Further, as provisions of section 50C came into effect on 1-4-2003, assessing officer was directed to take into account the sale consideration as noted in the impugned sale deed, while computing the capital gain for assessment year 2002-03. Income Tax Act, 1961, Sections 2(47)(v), 45, 50C Income Tax Act, 1961 --Reassessment --Limitation Income excluded from one assessment year and included in another assessment year pursuant to order of Tribunal --Assessee executed a deed of sale on 21-5-2001. The possession of the property was handed over on the same day. However, the deed was registration 30-7-2003. Assessing officer was of the view that transfer took place on 30-7-2003, consequently, finalized the assessment under section 144 on 28-12-2007 taxing capital gain on sale of said property in the assessment year 2004-05 Commissioner (Appeals) vide its order dated 25-3-2011, concurred with the views of assessing officer. This Tribunal held that since possession was given to assessee on 21-5-2001, the transfer took place in assessment year 2002-03 and not in assessment year 2004-05. Now, the question arose as to possibility of re-opening the assessment for assessment year 2002-03. Assessee argued that provisions of section 150(2) were to be applied in respect of an order which is subject matter of appeal i.e., the order of Commissioner (Appeals) and since on that date, the limitation period specified in section 149 was expired, assessment could not be re-opened. Assessing officer argued that provisions of section 150(2) were to be applied in respect of order of assessing officer dated 28-12-2007 as such order was the subject matter of appeal. *Held :* The assessment order passed by assessing officer on 28-12-2007 was the order which was the subject-matter of appeal. At that time, when the reopening of assessment year 2004-05 was made, the assessing officer could have also simultaneously taken the action for assessment year 2002-03 and that action of the reopening was not barred by limitation at that point of time. In other words, for assessment year 2002-03, the assessing officer could have initiated the proceedings under section 148 upto six years from the end of relevant year i.e. upto 31-3-2008. Further a conjoint reading with section 153(3), a reassessment may be completed at any time where the reassessment is made in consequence of or to give effect to any finding/direction of an order passed under section 254(1) of the Act i.e., an order of the Tribunal. SUBSCRIBE FOR FULL CONTENT

The Tax Publishers2013 TaxPub(DT) 1560 (Ahd-Trib) : (2013) 053 (II) ITCL 0118 : (2013) 154 TTJ 0514 : (2013) 087 DTR 0042

Income Tax Act, 1961

--Capital gains--Transfer under section 2(47)(v) Transfer effective whether from date of execution or date of regulation of sale deed--Assessee executed a deed of sale on 21-5-2001. The possession of the property was handed over on the same day. The consideration of sale was received party on 30-4-2001 and balance on 23-5-2001. However, the sale deed was registered on 30-7-2003. Assessing officer was of the view that transfer under section 2(47)(v) took place on 30-7-2003 and taxed the capital gain on sales of the said property in the assessment year 2004-05 assessing officer also adopted market value by invoking section 50C. Commissioner (Appeals) concurred with the views of assessing officer. On appeal before the Tribunal, assessee submitted that assessing officer wrongly held that transfer took place in assessment year 2004-05 merely on the basis of date of registration whereas transfer is effective from date of execution of document. Held : In view of the decision rendered in Chaturbhuj Dwarkadas Kapadia v. CIT 2003 TaxPub(DT) 1029 (Bom-HC) : (2003) 260 ITR 491 (Bom), wherein it was held that in a situation where consideration had been paid and the possession had been handed over, then in view of the provisions of section 2(47)(v) transfer took place and that date of transfer was thus required to be taken for the purpose of computation of capital gain. The capital gain was required to be assessed in assessment year 2002-03 and not In assessment year 2004-05. Further, as provisions of section 50C came into effect on 1-4-2003, assessing officer was directed to take into account the sale consideration as noted in the impugned sale deed, while computing the capital gain for assessment year 2002-03.

Income Tax Act, 1961, Sections 2(47)(v), 45, 50C

Income Tax Act, 1961

--Reassessment --Limitation Income excluded from one assessment year and included in another assessment year pursuant to order of Tribunal --Assessee executed a deed of sale on 21-5-2001. The possession of the property was handed over on the same day. However, the deed was registration 30-7-2003. Assessing officer was of the view that transfer took place on 30-7-2003, consequently, finalized the assessment under section 144 on 28-12-2007 taxing capital gain on sale of said property in the assessment year 2004-05 Commissioner (Appeals) vide its order dated 25-3-2011, concurred with the views of assessing officer. This Tribunal held that since possession was given to assessee on 21-5-2001, the transfer took place in assessment year 2002-03 and not in assessment year 2004-05. Now, the question arose as to possibility of re-opening the assessment for assessment year 2002-03. Assessee argued that provisions of section 150(2) were to be applied in respect of an order which is subject matter of appeal i.e., the order of Commissioner (Appeals) and since on that date, the limitation period specified in section 149 was expired, assessment could not be re-opened. Assessing officer argued that provisions of section 150(2) were to be applied in respect of order of assessing officer dated 28-12-2007 as such order was the subject matter of appeal. Held : The assessment order passed by assessing officer on 28-12-2007 was the order which was the subject-matter of appeal. At that time, when the reopening of assessment year 2004-05 was made, the assessing officer could have also simultaneously taken the action for assessment year 2002-03 and that action of the reopening was not barred by limitation at that point of time. In other words, for assessment year 2002-03, the assessing officer could have initiated the proceedings under section 148 upto six years from the end of relevant year i.e. upto 31-3-2008. Further a conjoint reading with section 153(3), a reassessment may be completed at any time where the reassessment is made in consequence of or to give effect to any finding/direction of an order passed under section 254(1) of the Act i.e., an order of the Tribunal.