The Tax Publishers2020 TaxPub(DT) 2945 (Del-Trib) : (2020) 183 ITD 0728

INCOME TAX ACT, 1961

Section 143(3)

Where assessee-builder having sold GPT in preceding year offered tax on profit arising therein, however just because the sale consideration was received in relevant assessment year and payer had deducted tax at source, the receipt cannot be treated as income of assessee once again as no income can be taxed twice.

Assessment - Addition to income - Amount reflected in Form No. 26AS received from buyer - Related income already offered to tax in preceding year

Assessee has sold Global Technology Park, Bangalore, for Rs. 294 crores to M/s. Adamass Builders (P) Ltd. This transaction was concluded in assessment year 2013-14 and assessee offered above sale consideration and profit arising therein as its income in that year. Profit and loss account of assessee clearly depicted the same. However, buyer did not pay full amount to assessee because of certain pending obligation on part of assessee, as per 'agreement' for sale of above property. Assessee was to obtain necessary approval from the Govt. Authorities such as Airport Authority of India, Water Supply and Sewerage Board and State Industrial Development Board. Admass Builders Private Limited, (Buyer) as and when obtained such approvals, sanctions, debited expenses to the account of assessee in its books and also deducted tax at sources under section 194J. Thus, expenses incurred by Adamass Builders were adusted from above sale consideration payable to assessee. This was part of the agreement and lease deed entered into between parties. Accordingly, AO made addition of amount of Rs. 2 crores as reflected in Form No. 26AS and received from Adamas Builders (P) Ltd.Held: It was apparent that Rs. 2 crores was on account of outstanding receivables from the above party debited by Admass Builders to the account of assessee towards various charges. Just because the payer deducted tax at source, could not become income of recipient automatically. It was undisputed that total sale consideration received/receivable was offered for taxation in immediately preceding year and thus, receipt of consideration, which had been already offered for taxation in earlier years, received in this year, naturally could not suffer tax once again as it would amount to double taxation in the hands of assessee.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2014-15

INCOME TAX ACT, 1961

Section 32(1)

SUBSCRIBE TaxPublishers.inSUBSCRIBE FOR FULL CONTENT