INCOME TAX ACT, 1961

Section 45 Section 2(14) Section 2(47)

Capital gains - Capital asset - Part transfer of alleged agricultural Land in asst.yr. 2005-06 - In assessee's father's case no addition for said agricultural land made as sale agreement not acted upon in relevant asstt. yr.

AO reopened the assessment for the assessment year 2011-12 on ground that the assessee had sold two immovable properties during the year under consideration. Assessee during the re-assessment proceedings submitted that he had not sold any property during Financial Year 2010-11 relevant to assessment year 2011-12; that transactions referred in the reasons recorded represent the registration of sale deed made by Power of Attorney of the assessee for certain agricultural lands situated at Uthandi Village, which were in the names of the assessee, his father RG and his brother KG. AO did not agree with the contention of the assessee on the ground that the possession was handed over by the assessee to M/s. R. Educational Society in March, 2005 vide sale agreement dated 21-3-2005 was incorrect. The AO also observed that the original sale agreement dated 21-3-2005 was executed for 3.935 acres of land at Uthandi Village, whereas the sale deed executed on 9-12-2010 for the assessment year 2011-12 was only for 172 cents of vacant land for total consideration of Rs. 1,46,20,000 and 26 cents of vacant land for consideration of Rs. 68,01,600. The AO also observed that sale deeds of lands executed on 9-12-2010 were not agricultural lands as per the official web site of the Registration Department, Tamilnadu. CIT(A) held that the 'transfer' of agricultural land was relevant to assessment year 2005-06 and duly considered in assessment year 2005-06. Held: The copy of assessment order framed in the hands of father RG for the assessment year 2011-12 under section 143(3) dated 31-3-2016 wherein during the course of assessment proceedings of father, a specific query was raised with regard to details of sale of agricultural land at Uthandi village during the assessment year 2011-12.. The AO of assessee's father, i.e., Asstt. CIT, Circle-1, Chennai was duly convinced by a certificate issued by Village Administrative Officer, who had certified that the subject mentioned lands were agricultural lands and accordingly did not proceed to make any addition in the hands of assessee's father for assessment year 2011-12. The Bench at the time of hearing raised a specific query to the AR to prove the fact that those lands that were registered on 9-12-2010 by the Power of attorney holder were included in 3.935 acres of land for which purpose the Bench directed the AR to match Survey Numbers thereon. This details requires factual verification from the side of the AO and hence in the interest of justice and fair play, it was deemed fit and appropriate to remit this issue to the file of AO for adjudication.

REFERRED :

FAVOUR : Matter remanded.

A.Y. : 2011-12

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