|CORAM:||B. Ramakotiah (AM), Saktijit Dey (JM)|
|CATCH WORDS:||capital gains, Development agreement, transfer|
|COUNSEL:||P. Soma Sekhar Reddy|
|DATE:||September 24, 2014 (Date of pronouncement)|
|DATE:||October 4, 2014 (Date of publication)|
|FILE:||Click here to download the file in pdf format|
|No transfer merely because development agreement is entered into|
As can be seen from the observations made by CIT(A), he has given specific finding of fact that development agreement has not been acted upon by the developer till date. Therefore, he has concluded that as there is no willingness or part performance of contract by the developer, which has resulted in filing of civil suit seeking cancellation of the development agreement, it cannot be said that there is transfer of capital asset as envisaged u/s 2(47(v) read with section 53A of the Act. This finding of fact arrived at by CIT(A) has not been controverted by the department by bringing on record documentary evidence or through any other mode to prove that development activity under the development agreement has been started by developer. In the aforesaid factual position, since there is failure on the part of the developer to perform his part of the contract, it cannot be said that there is transfer of capital asset merely because assessee has entered into development agreement with the developer.