The Pune bench of the Income Tax Appellate Tribunal (ITAT) has held that the capital gain in respect of consideration received from sale of property cannot be taxed from the owner of the property as the same is already taxed from the Power of Attorney holder.
The assessee, Mrs. Bharti Narendra Oswal, through her Power of Attorney Holder, Jayantilal Oswal sold her property. The said Jayantilal Oswal entered into an agreement for sell with Mrs. Saroj Mahendrakumar Nibjia and Another for consideration of Rs.2,00,00,000/- and received Rs.11,00,000/- and disclosed sale consideration at Rs.2,00,00,000/- and by availing indexed cost offered capital gain at Rs.1,31,23,659/-.
The assessee contended that when the assessee received no consideration she cannot be taxed for the same for the reason then the said sale consideration is neither accrued to her nor was deemed to be accrued to her.
The point for consideration before the bench comprising Shri Inturi Rama Rao, Accountant Member and Shri S.S. Viswanethra Ravi, Judicial Member was that whether the assessee can be taxed on account of capital gain in the absence of receipt of sale consideration.
Allowing the contentions of the assessee, the Tribunal held that “we find force in the arguments of ld. AR that it is not correct to be taxed in the hands of assessee when the same was taxed in the hands of Jayantilal Oswal. Therefore, when the assessee not received the said sale consideration of Rs.2,00,00,000/- vide registered Deed of Assignment dated 13-01-2013 and the same was received by the said Jayantilal Oswal as a consenting party which was disclosed by him under the head capital gain by Schedule 18 of his return of income, again, taxing the same in the hands of assessee is not justified. Thus, the order of CIT(A) in confirming the order of AO in taxing the assessee on account of capital gain of Rs.1,26,80,413/- is not justified and it is set aside. Thus, ground Nos. 2 to 5 raised by the assessee are allowed.”
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
