The capital gain derived from the conversion of land into SIT and the resulting commercial profit (i.e. the area of land retained by the developer on a pro rata basis, i.e. 4000 square feet) are taxable in AY 21-22, that is: The year in which the project is completed and assessee obtains its share in the developed project. Article 95 provides that an agreement entered into by an evaluator may be declared an “inadmissible obsedation agreement” (BIT). ยง 96 defines the scope of the concept of “inadmissible suspension agreement”. It has been provided that, in the event that the “main objective” of the agreement is to obtain tax advantages and – The term transfer has been defined under the Law in section 2 (47) only with regard to capital assets. The definition of assignment in Section 2 (47) cannot therefore apply to the sale/transfer of shares in the trading of JDA or others. In summary, the new section 45, paragraph 5A and 2(47) of Law u/s 2(47) of the Act fixed the tax year of the capital gain, regardless of the year of capital transfer (in the form of land); and also eliminated subjectivity in the valuation of non-monetary counterparties received/accumulated as a result of the transfer under the development agreement. In addition, the mystery of the JDA`s “transfer” of capital, imposed by Parliament for the introduction of Section 45(5A), will continue in the following circumstances: the discussion can be summarized by reference to the detailed judgment in ACIT vs. Jawaharlal Agicha (2016) 75 taxmann.com 121 (Mumbai): the provisions of Section 2 (47) apply only in cases of capital. In accordance with section 2 (14), the capital does not include traded shares. Once the value of the capital has been converted into shares, the provisions of Article 2(47) shall not be relevant and shall not apply. – At the end of the project, Mr X is entitled to 60 % of the built area of the project in the form of housing/shops, etc., in accordance with Article 45 of the Income Tax Act, 1961 – Capital gains – (in case of conversion of assets into trading shares) – Investment years 2008-09 and 2009-10 – Assessee acquired land in 200 2 – On 30.12.2005 it transferred this land to a developer through a development contract – instead of such a transfer, Assessee received 27 % of the built area in the form of housing/bunglows, which were then sold to different buyers – income from the transfer of land through a development contract and the subsequent sale of housing and bunglows was to be calculated in accordance with Article 45, paragraph 2..

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