Law: Income Tax Act, 1961

Section: 22

Income-tax-----Income from property ---Assessee executing sale-deed and transferring property---Sale-deed presented for registration in December, 1970, but registration only in 1975---Income from property not assessable in hands of assessee for assessment year 1972-73---Indian Income-tax Act, 1961, S.22---Indian Transfer of Property Act, 1882, S. 53-A. Under the Income-tax Act the assessing authority has power to assess income from property in the hands of the real owner of the property. Section 53-A of the Transfer of Property Act, 1882, debars a transferor from exercising the rights of an owner after he has received full consideration and handed over possession under the contract. The assessee had sold her half share in a property to a trust under an assignment deed, dated September 29, 1970, which was presented before the Sub-Registrar for registration on December 24, 1970. The deed was registered on May 17, 1975. The assessee submitted before the assessing authority that the income from such property could not be assessed in her hands as she was legally divested of her title The assessing authority rejected the assessee's contention and held that the title to immovable property could pass only from the date of registration. The Tribunal came to the conclusion that unless there is transfer of property by a registered sale-deed the title in respect thereof did not pass and the assessee being the owner of the property, the income had to be assessed in the hands of the assessee. On a reference: Held, that since the assessee had already executed the sale-deed and had presented the same for registration before the Sub-Registrar on December 24, 1970, and the income from the said property was received by the transferee, the assessee could not be considered to be the owner thereof The income from the property was not assessable in her hands for the assessment year 1972-73. Alpati Venkataramiah v. CIT (1965) 57 ITR 185 (SC); CIT v. Biman Behari Shaw Shebait (1968) 68 ITR 815 (Cal).; CIT v. Ganga Properties Ltd. (1970) 77 ITR 637 (Cal).; CIT v. Jhanzie Tea Association (1989) 179 ITR 295 (Cal.); CIT v. Modem Flats (Pvt.) Ltd. (1967) 65 ITR 67 (Bom.); CIT v. Nawab Mir…

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