1. Binjusaria
Properties (P.) Ltd. Vs. Assistant Commissioner of Income Tax, Central
Circle-4, IT Appeal No. 157 (Hyd.) of 2011, Date of Order: 04.04.2014,
ITAT - HYD
Capital
gains could not be brought to tax merely on basis of signing of
development agreement, where developer had not done anything to
discharge obligations cast on it
Held that
since there was no developmental activity on the land which is subject
matter of development agreement. The process of construction has not
been even initiated and no approval for the construction of the building
is obtained. Thus, the sale consideration in the form of developed area
has not been received. Mere receipt of refundable deposit cannot be
termed as receipt of consideration. Further, as submitted , the
Assessing Officer calculated the capital gain on the entire land, even
though the assessee has retained 38% share to itself. The valuation was
also disputed.
There is,
therefore, no accrual of income in favour of the assessee as per S.48 of
the Act. Due to lapse on the part of the transferee, the construction
has not taken place in the year under consideration, and it has not
commenced even now. In the facts and circumstances of the present case,
wherein while the assessee has fulfilled its part of the obligation
under the development agreement, the developer has not done anything to
discharge the obligations cast on it under the develop agreement, the
capital gains cannot be brought to tax in the year under appeal, merely
on the basis of signing of the development agreement during this year.
(Please click here for judgment)
2. Commissioner of Income Tax, Kol-III Vs. Baljit Securities
(P) Ltd, ITAT No. 215 of 2013, Date of Order: 12.03.2014, High Court of
Calcutta
U/S. 73(1),
assessee bieng a share broker is entitled to set off loss incurred in
transactions of derivatives and day trading of shares against its
profits and gains from purchase and sale of shares on delivery basis
That where an
assessee, being the company, besides dealing in other things also deals
in purchase and sale of shares of other companies, the assessee shall be
deemed to be carrying on a speculation business. The assessee, in the
present case, principally is a share broker, as already indicated. The
assessee is also in the business of buying and selling of shares for
self where actual delivery is taken and given and also in buying and
selling of shares where actual delivery was not intended to be taken or
given. Therefore, the entire transaction carried out by the assessee,
indicated above, was within the umbrella of speculative transaction.
There was, as such, no bar in setting off the loss arising out of
derivatives from the income arising out of buying and selling of shares.
This is what the learned Tribunal has done.
(Please click here for judgment)
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