Delhi ITAT rules that
amount received by the assessees (who have formed a consortium for the purpose
integrated township development) on account of transfer of development rights
in the underlying land during AY 2008-09, not chargeable to tax u/s. 2(47)(v),
being not accrued to assessees in subject AY; ITAT notes that assessees have
entered into agreement for the development of integrated township in February,
2007 with the Ghaziabad Development Authority (GDA) which had also agreed
to provide assistance in acquisition of land other than the land owned by the
consortium parties so as to complete 72.9 acres; ITAT further notes that the
consortium parties entered into a shareholders’ agreement with a financial
partner on 18th May 2007to form SPV and under the shareholders agreement, the
assessees’ land and development rights together were valued at Rs. 103.45
crores, which were paid 60% in cash and 40% in terms of equity shares /
debentures and land was vested in SPV; Rejects Revenue’s stand that since the possession
of land was handed over by assessees to the SPV, it amounted to transfer in
terms of section 2(47)(v), observes that the shareholders agreement was
not registered which is the condition precedent to give effect to Sec. 53A of
the Transfer of Property Act, applies the ratio laid down by SC in case of
Balbir Singh Maini; Further notes that the consortium parties were under
obligation to provide the developed land along with necessary approvals and
permissions from the concerned competent authorities and in case they failed to
provide the agreed FSI, then the consortium parties would not be allowed to
withdraw their amounts fixed under the agreement, thus ITAT holds that “unless
and until the approvals and permissions are granted by GDA, it cannot be said
that any income accrued to the appellants.”: ITAT accepts assessees’ stand that
as and when the approvals would be granted in subsequent years, the
proportionate amount out of the advance so received under the shareholders
agreement shall be offered to tax:ITAT
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