S. 56 : Income from other sources -Immovable property -Redevelopment agreement -Permanent alternate accommodation allotted in lieu of surrender of tenancy rights -Redevelopment project incomplete and possession of alternate premises not handed over -Mere execution and registration of redevelopment agreement did not amount to receipt of immovable property -Assessee acquired only a contractual right to receive flat in future -Transaction supported by valuable consideration in the form of surrender of tenancy rights and could not be regarded as receipt of property without consideration-Section 56(2)(x) not applicable -Addition deleted.[ S. 56(2)(x)]
The assessee had entered into registered redevelopment agreements in respect of two premises in lieu of surrender of his tenancy rights in four existing shops. The Assessing Officer treated the stamp duty value of Rs.1,38,70,000 as income under section 56(2)(x), on the ground that registration of the agreements resulted in receipt of immovable property. The Tribunal noted that the redevelopment project was still incomplete, no occupation certificate had been obtained, and possession of the permanent alternate accommodation had not been handed over to the assessee. It held that the expression “receives” in section 56(2)(x) required actual receipt of immovable property and that mere execution or registration of a redevelopment agreement created only a contractual right to obtain a property in future. Further, the alternate accommodation was allotted in exchange for surrender of valuable tenancy rights and, therefore, the transaction was supported by reciprocal consideration and could not be regarded as receipt of property without consideration. Following the decisions in Snehalata Heramb Dhayagude, Anil Dattaram Pitale and Amar Narendra Joshi, the Tribunal held that section 56(2)(x) was not attracted and deleted the addition. (AY. 2018-19) (ITA No. 7534/Mum/2025 dt. 16-07-2026)
Manoj Devshichhadva v. ITO (Mum.)(Trib.) [www.itatonline.org]
[Coram : Hon’ble Shri Vikram Singh Yadav, AM and Hon’ble Shri Siddhartha Nautiyal, JM]