Indian Kanoon - Search engine for Indian Law

6. On the facts and in the circumstances of the case and in law, the learned CIT(A) has erred in not observing the 7/12 extract wherein the name of the assessee is reflected in the name "others" which do not prove the ownership in the name of the assessee.

3. The only issue raised in the present appeal is in relation to the treatment of gain arising on sale of rights in the property.

4. The brief facts of the case are that Survey under section 133A of the Act was carried out at the premises of assessee on 21.03.2006. During the course of Survey, statement of assessee was recorded, in which he admitted to have received compensation of Rs.3,21,10,358/- from Maharashtra Housing and Development Authority (MHADA) towards acquisition of land admeasuring 80307 sq. mtrs. In the return of income filed pursuant to notice under section 148 of the Act, the assessee declared total income of Rs.2,92,89,040/- and agricultural income of Rs.1,57,350/-. The assessee had acquired development rights in the land situated at Survey No.312 (old) / 130 (new), Majarewadi, Jule Solapur, vide agreement dated 18.01.1996, under which the consideration was fixed at Rs.45,00,000/-. The said property was owned by one Shri Suresh S. Bhaiyya. Another supplementary development agreement of land was executed on 26.07.1999. It was admitted that out of total consideration of Rs.45,00,000/-, sum of Rs.31,00,000/- was paid up to 26.07.1999. The assessee ultimately purchased the land vide Sale Deed dated 31.08.2000 for consideration of Rs.23,92,000/- and stamp duty of Rs.2,23,000/- was paid. Subsequently, out of this land, MHADA acquired land admeasuring 80307 sq. mtrs. and paid compensation of Rs.3,21,10,358/- on 14.12.2002. As per the assessee, income on account of compensation received was to be assessed as income from long term capital gain, whereas the Assessing Officer was of the view that the Shri Prakash Rajaram Bolgamwar transaction between the parties was completed by handing over the possession vide Sale Deed dated 31.08.2000, as initially no possession was given to the assessee and only permission was given to carry out the development works and other transactions, and hence it was Short Term Capital Gains. On the other hand, claim of the assessee was that it was in possession of the land since 18.01.1996. The Assessing Officer held that the income was assessable as income from short term capital gain.

Shri Prakash Rajaram Bolgamwar

8. The learned Authorized Representative for the assessee drew our attention to the English translation, copies of different agreements executed between the parties. It was pointed out that as per the Development Agreement dated 18.01.1996, possession was given to the assessee though under clause

(o), it conferred only ownership rights in the said property. Further, the sale deed talks about absolute ownership and the perpetual ownership were given to the assessee. Further, reference was made to the terms of supplementary Development Agreement dated 26.07.1999, wherein it has been mentioned that the assessee was to take possession from MHADA. Further, the name of assessee was recorded in other relevant documents i.e. 7/12 extracts. The award for payment of compensation is placed at page 7 of the Paper Book and the award has been given to the Power of Attorney holder and even cheque was issued to the said person i.e. the assessee. Our attention was also drawn to the wealth tax orders placed at page 15 of the Paper Book. Reliance was placed on the ratios laid down in the following cases:-