In ITA Nos.390 to 392/Hyd/2022 -ITAT- No taxation in Assessee's hands if Company already paid taxes on sale proceeds, rules ITAT (Hyderabad)
Members K. Narasimha Chary (Judicial) & R.K. Panda (Accountant) [12-06-2023]

Read Order: Sanjeeva Prasad Ponnapula v. Dy. C.I.T Central Circle 3(2) Hyderabad

Chahat Varma

New Delhi, June 15, 2023: The Hyderabad bench of the Income Tax Appellate Tribunal has ruled that taxing the sale proceeds in the hands of the assessee as the GPA holder, when they had already been taxed in the hands of M/s Trinity Infraventures for previous assessment years, would result in double taxation.

In the matter at hand, it was contended by the assessee that the transfer of land in different survey numbers was done by the assessee in his capacity as a ‘General Power of Attorney holder’ and not as the actual owner. Therefore, it was submitted that the income arising from the transfer of these properties by the assessee, who acted solely as a GPA holder, should not be taxed in the assessee's hands.

The order of the CIT (A) in assessee’s own case for the same A.Y. in the first round of litigation was brought to the attention of the bench, wherein the CIT (A) had observed that the appellant was only GPA holder in respect of the property and the capital gains arising out of the transaction was not assessable in appellant’s hands.

The bench opined that if the company which had received the payments from the buyers at the instance of the assessee, had already paid taxes on account of the sale of the properties, then, there was no question of taxing the same in the hands of the assessee.

Consequently, the Tribunal decided to restore the issue to the Assessing Officer's file for reconsideration.