Pune
ITAT accepts assessee’s (land owner) plea that advance received from
developer towards flat booking shall not be taxable in subject AY 2009-10 on
receipt basis, but in subsequent AY when the project was completed and
tenements / flats were handed over to the prospective buyers; Notes that the
assessee had given the land for development and was entitled to receive 18% on
gross sales under the terms of development agreement (‘DA’); With
respect to advance booking amount received in subject AY, ITAT remarks
that “The said amount received by the assessee is an advance receipt
because the right to collect the said amount would crystallize on the day when
the tenants or portion of land is sold by the developer to the prospective
buyers.”; Moreover, observes that the developer recognized the completion
and sale of developed portion in subsequent AY 2011-12, consequently, holds
that the business profits arising to assessee were taxable in such year;
Lastly, ITAT clarifies that since the amount is not assessable to tax as his
business profits in subject AY, the capital gains arising on conversion of
capital asset into stock-in-trade is also not to be taxed in the hands of
assessee in subject AY but in the year in which the business profits are to be
taxed:ITAT
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Pre-GST taxes cannot be refunded if paid pursuant to an inquiry
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