The assessee and his late father purchase property from a common pool of funds belonging to the Hindu Undivided Family (HUF). The property was taken in their name for convenience purpose but formed part of the common pool along with other properties. This fact could be verified by the partition deed, filed with the authorities.

Assessee, along with ten others, entered into a development agreement with a builder. No capital gain tax was offered.  After a survey, the assessee filed a belated revised return offering capital gains to tax and claiming exemption u/s. 54F. Before the A.O., assessee contested that it was co-owner of 20 per cent, while HUF members owned the other 80 per cent. The department had passed protective assessment orders in the hands of HUF members that have now become final. The A.O. did not accept the contention while holding the property to be registered in the name of the assessee he would be liable to capital gain tax.

CIT(A) accepted that the property belonged to HUF and its members, in whose hands the protected assessment was carried out. There is no challenge to the protected assessment in the hands of the HUF members, that has now become final. Tribunal approved the order of the CIT(A), besides holding that the department was aware of the partition deed.  (AY. 2008-09)