Income Tax Appellate Tribunal - Pune
Asstt. Cit vs Nagesh C. Kawale on 11 July, 2000
Equivalent citations: [2001]79ITD38(PUNE)
ORDER
Chhibber, A.M. The only grievance projected in this appeal by the revenue is that the learned Commissioner (Appeals) is not justified in holding that the gain derived by the assessee on transfer of property was a long-term capital gain.
2. Shri G.G. Kawale, father of the assessee purchased a plot measuring 6089 sq.ft. in 1966 for Rs. 4,000. The said plot was reserved by the State Government for School from 1966 to 1981 and for Garden from 1982 to February, 1987. Shri G.G. Kawale sold this plot to the assessee on 23-9-1985 on executing a sale deed for cash consideration of Rs. 25,000 (while the plot was still under reservation for garden). The sale deed on a stamp paper was presented to the Registrar on the same day, i.e. 23-9-1985. The Registrar demanded NOC under section 26 of ULC Act, 1976. The assessee argued with him that the land being reserved for garden was non-vacant land according to clear meaning of section 2(q) of ULC Act, 1976 as well as the Supreme Court decision in State of UP v. L.J. Johnson AIR 1983 SC 1803. The Registrar accepted the document on that day by agreeing to the contentions of the assessee.
But the document was not finally copied out in the books of the Registrar till December, 1987. The assessee accordingly again approached the Registrar and convinced him about the non-requirement of NOC' under section 26 of ULC Act, 1976. Finally, the document was registered on 8-1-1988. Thereafter, the assessee entered into agreement for sale with Bhosale Construction Co. for total consideration of Rs. 9,74,240 on 27-4-1990. But, as subsequently Bhosale Construction Co. became non-interested with the plot, the assessee finally entered into agreement to sell with Shri Vijay Shewale on 2-10-1990. The assessee offered the gains as long-term capital gains because according to the assessee he had purchased the plot from his father on 23-9-1985. BLit since the plot was registered in the name of the assessee on 8-1-1988, the assessing officer adopted this date as the date of acquisition by the assessee and computed short-term capital gains instead of long-term capital gains.
3. The assessee appealed to the Commissioner (Appeals) who accepted the contentions of the assessee and held that the date of execution of the document on 23-9-1985 is the effective date of transfer because it was on that date that the vendor Shri G.G. Kawale had executed the sale deed. In support of this view, she relied upon sections 27 and 49 of Indian Registration Act and the decision of the Gujarat High Court in the case of Arundhati Balkrishna v. CIT (1982) 138 ITR 245 and decision of the Special Bench of the ITAT in C. Vedachala Mudaliar v. ITO (1992) 198 ITR (AT) 18. Aggrieved by the order of the learned Commissioner (Appeals), the revenue is in appeal before this Tribunal.
4. Shri Adhir Jha, the learned Departmental Representative strongly supported the order of the assessing officer. He submitted that the decision of the Honble Supreme Court in the case of Rani Saran Lall v. Mst. Domini Kuer AIR 1961 SC 1747 is squarely applicable to this case according to which the date of registration of the document is the relevant criteria in considering the execution of the transfer of a property.
5. Shri K.A. Sathe, the learned counsel for the assessee strongly supported the order of the learned Commissioner (Appeals). He submitted that the effective date of transfer was the date on which sale was executed and not the date of registration which lingered on due to circumstances beyond the control of the assessee. He relied upon the three cases relied upon by the learned Commissioner (Appeals) and further relied upon the judgment of the Honble Supreme Court in the case of Hamda Ammal v. Avadiappa Pathar (1991 ) 1 SCC 715.
6. We have considered the rival submissions and perused the facts on record. In Hamda Ammals case (supra) the Honble Supreme Court while interpreting section 47 of Registration Act, 1908 has held "Documents after its registration relates back to date of execution of sale deed". The Honble Supreme Court has distinguished its earlier decision in the case of Rani Saran Lall (supra) relied upon by the learned Departmental Representative. Thus, following the latest decision of the Supreme Court on the issue, we concur with the finding of the Commissioner (Appeals) and decline to interfere.
7. In the result, the appeal is dismissed.