The assessee entered into an agreement to sell with Vijay Santhi Builders Ltd  on May 15, 1998 for a total sale consideration of Rs. 5.5 crores. The agreement provided, inter alia, that both parties were entitled to specific performance of the agreement. Under the agreement the assessee gave permission to the builder to start advertising, selling, and make construction on the land. Pursuant to the agreement, a power of attorney was executed on November 27, 1998, by which the assessee appointed a director of the builder-company to execute, and join in execution of, the necessary number of sale agreements or sale deeds in respect of the schedule mentioned property after developing it into flats. The power of attorney also enabled the builder to present before all the competent authorities such documents as were necessary to enable development on the property and sale thereof to persons. Subsequently, a memorandum of compromise dated July 19, 2003 was entered into between the parties, under which the agreement to sell and the power of attorney were confirmed, and a sum of Rs. 50 lakhs was reduced from the total consideration of Rs. 6.10 crores. Clause 3 of the compromise deed confirmed that the assessee had received a sum of Rs. 4,68,25,644 out of the agreed sale consideration. Clause 4 recorded that the balance Rs. 1.05 crores towards full and final settlement in respect of the agreement entered into would be paid by seven post-dated cheques. Clause 5 stated that the last two cheques would be presented only upon due receipt of the discharge certificate from one Pioneer Homes. The assessee not having filed any return for the assessment year 2004-05 the assessment of the assessee for this year was reopened. Since the assessee did not respond to notices and limitation was running out the Assessing Officer passed an order of best judgment assessment treating the entire sale consideration as capital gains and bringing it to tax. The CIT (A) dismissed the assessee’s appeal therefrom. The Appellate Tribunal agreed with the CIT (A). High Court also affirmed the order of the Tribunal. On further appeal   affirming the order of  High Court the Court held that, agreement to sell, such licence could not be said to be “possession” within the meaning of section 53A of the Transfer of Property Act, 1882, which is a legal concept, and denotes control over the land and not actual physical occupation of the land. This being the case, section 53A of the 1882 Act could not possibly be attracted to the facts for this reason alone. As on the date of the agreement to sell, the owner’s rights were completely intact both as to ownership and to possession even de facto, so that section 2(47)(vi) of the 1961 Act equally, could not be said to be attracted. That the finding of the Tribunal was that all the cheques mentioned in the compromise deed had, in fact, been encashed. This being the case, the assessee’s rights in the immovable property were extinguished on the receipt of the last cheque and the compromise deed could be stated to be a transaction which had the effect of transferring the immovable property in question. The transaction fell under S.  2(47)(ii) and (vi) of the 1961 Act.  (A No 462 of 2011 dt 25 1-2012 (Mad.) (HC) is affirmed )  (AY. 2004-05)