Transfer of Title in Respect of Immovable Property takes place Only through a Registered Sale Deed: ITAT [Read Order]

The New Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that the transfer of title in respect of immovable property takes place only through a registered sale deed. 

Grow More Buildtech Pvt. Ltd, the respondent-assessee was a resident corporate entity that filed a return of income during the assessment proceedings. The assessing officer made an addition to the income of the assessee due to the unexplained transfer of land and the Commissioner of Income Tax (Appeals) deleted the addition made by the assessing officer. 

Thus the revenue appealed against the order passed by the Commissioner of Income Tax (Appeals) for deleting the addition made by the assessing officer. 

Rakesh Gupta and Somil Agarwal, the counsel for the assessee contended that the assessee had entered into the agreement to sell in the impugned assessment year and had received the sale consideration of land, the assessing officer brought the profit on the sale of land to tax in the impugned assessment year. 

It was further submitted that the transfer of title in respect of immovable property takes place only through a registered sale deed and till the property was conveyed by the seller to the buyer through a registered sale deed, the transfer of title was not complete. 

Vivek Vardhan, the counsel for the revenue contended that the assessee had received the full and final payment of the entire sale consideration of land during the year but had also handed over physical possession of the land to the purchaser. 

The bench observed that merely because substantial amounts out of the sale consideration are received or possession was handed over, would not be sufficient to construe a transfer of title over the property. 

The two-member bench comprising Saktijit Dey (Judicial) and N.K. Billaiya ( Accountant) held that the decision made by the Commissioner of Income Tax (Appeals) by deleting the addition made by the assessing officer was as per the law while dismissing the appeal filed by the revenue. 

To Read the full text of the Order CLICK HERE

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