Click Here For Best Books On Taxation & Law. Upto 60% Off On Select Titles. Free Shipping & Pay On Delivery!
 

Click Here To Subscribe To Our Free Newsletter

Home › All Judgements › Raj Ratan Palace Co-op Hsg Soc vs. DCIT (ITAT Mumbai)

Raj Ratan Palace Co-op Hsg Soc vs. DCIT (ITAT Mumbai)

Posted on by editor — No Comments ↓
COURT:
CORAM:
SECTION(S):
GENRE:
CATCH WORDS:
COUNSEL:
DATE: (Date of pronouncement)
DATE: April 26, 2011 (Date of publication)
AY:
FILE:
CITATION:

Click here to download the judgement (raj_ratan_society_redevelop.pdf)


Granting permission for development not “transfer” & consideration not assessable in society’s hands

The assessee, a co-operative housing society, was the owner of a plot of land on which a building was constructed. The assessee entered into a development agreement pursuant to which it gave the developer the right to demolish the structure and construct a new building. In consideration, the developer paid Rs. 2.51 Lakhs to the assessee and Rs. 3.02 crores to the individual members of the society. The AO held that as the assessee was the owner, it was entitled to the entire consideration of Rs. 3.02 crores (though paid to the members) and was assessable u/s 2(24). This was confirmed by the CIT(A) on the ground that the grant of development rights was a “transfer” and the consideration was assessable as “capital gains”. On appeal by the assessee, HELD allowing the appeal:

The assessee-society had merely given permission to the developer to construct on the society’s land. No part of the land was ever transferred by the society. The Society continued to be the owner of the land and no change in ownership of land had taken place. Mere grant of consent will not amount to transfer of land/or any rights therein. The amount of Rs. 3.02 crores received by the members (on which some of them had paid tax) was not assessable in the assessee’s hands either u/s 2(24) or as capital gains

See also Lotia Court 118 TTJ 199 (Mum), New Shailaja CHS (ITAT Mum), Om Shanti (ITAT Mum), Jethalal Mehta 2 SOT 422 & Taxation of Real Estate Transactions: A Treatise

Related Posts:

  • DCIT vs. JSW Limited (ITAT Mumbai) In the light of the above discussions, we are of the considered view that rather than taking a pedantic view of the rule requiring pronouncement of orders within 90 days, disregarding the important fact that the entire country was in lockdown, we should compute the period of 90 days by…
  • DCIT vs. Reliance Jio Infocomm Ltd (ITAT Mumbai) The assessee pursuant to the terms of the "agreement‟ had only received standard facilities i.e bandwith services from RJIPL. In fact, as observed by the CIT(A), the assessee only had an access to services and did not have any access to any equipment deployed by RJIPL for providing the bandwith…
  • DCIT vs. Piramal Realty Pvt. Ltd (ITAT Mumbai) Even amendment to section 68 brought by Finance Act, 2012 does not refer to valuation. The insertion of the proviso to section 68 of the Act by Finance Act, 2012 casts an additional onus on the closely held companies to prove source in the shareholders subscribing to the shares of…
  • Sachin R. Tendulkar vs. DCIT (ITAT Mumbai) Therefore, it is not at all relevant as to whether the property was let out in past or not. These words do not talk of actual let out also but talk about the intention to let out. If the property is held by the owner for letting out and efforts…
  • DCIT vs. Comet Investment Pvt. Ltd (ITAT Mumbai) The broker, through whom the assessee carried on share transactions, were also not imposed any penalty. No co-relation between the assessee on the one hand and the other parties on the other hand has been brought on record to co-relate that the parties to whom the alleged profits or loss…
  • Concept Communication Ltd vs. DCIT (ITAT Mumbai) Retraction being on affidavit was legal and valid and was not belated. Further retraction was supported by explanation of impounded documents to the Survey team. The impounded document did not contain any information which was not recorded in the books of accounts. Hence, in view of retraction and such retraction…

Related Judgements

  1. ACIT vs. M/s Triace (ITAT Mumbai) 

    Where the CIT (A) decided the ground of reopening against the assessee but decided the ground of merits in favour of the assessee, the assessee is entitled, in an appeal by the Revenue before the Tribunal, to urge, under Rule … ACIT vs. M/s Triace (ITAT Mumbai) Read…
  2. DCIT vs. Balaji Shipping (1.6 MB) (ITAT Mumbai) 

    Where the assessee had earned freight income by transporting cargo in international traffic through ‘slot charter’ arrangements on ships owned by other enterprises and the question arose whether such profits arose from “operation of ships”, held: that in view of the OECD Commentary, Article 9 of the India-UK DTAA…
  3. J. M. Baxi vs. DDIT (ITAT Mumbai Special Bench) 

    Where the assessee suo motu filed returns as “agent” of a non-resident but no assessment was made and after the expiry of two years from the end of the assessment year a notice under section 148 of the Act seeking to assess the income and the question arose whether…
  4. DCIT vs. Glenmark Laboratories (ITAT Mumbai) 

    In Syncome Formulations, the Special Bench had to consider two questions i.e. (a) method of computation of deduction u/s 80HHC and (b) percentage of deduction allowable in each year. As regards the percentage of deduction, the Special Bench held that the assessee would be entitled to 100% deduction. This…
  5. Tata Sons Limited vs. DCIT (ITAT Mumbai) 

    While s. 91 allows credit for Federal & State taxes, the DTAA allows credit only for Federal taxes. The result is that the s. 91 is more beneficial to the assessee & by virtue of s. 90(2) it must prevail over the DTAA. Though s. 91 applies only to…

Leave a Reply

Your email address will not be published. Required fields are marked *

*