IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD “A” BENCH: HYDERABAD BEFORE SHRI MANJUNATHA G, ACCOUNTANT MEMBER AND SHRI RAVISH SOOD, JUDICIAL MEMBER Assessment Year 2016-2017 Sri Naveen Kumar Musinipally, USA, Resident of 133/4, R.P. The ADIT [INT-TAXN]-1, vs.

Road, SECUNDERABAD. Hyderabad.

PIN 500 003. Telangana.

PAN APEPM4130Q (Appellant) (Respondent)

For Assessee : CA, K C Devdas For Revenue : Sri Posu Babu Alli, Sr. AR Date of Hearing : 20.08.2025 Date of Pronouncement : 15.10.2025 ORDER PER MANJUNATHA, G.

This appeal has been filed by the assessee against the Order dated 09.02.2024 of the learned Commissioner of Income Tax (Appeals)-10, Hyderabad, relating to assessment year 2016-2017.

2. The assessee has raised the following grounds in the instant appeal :

“Under the facts and circumstances of the case, 1. The order of the Commissioner of Income Tax Appeals -10, Hyderabad (The Ld.CIT(A)') in confirming the taxation of long term capital gains arising on the development agreement under section 153C r.w.s 144C(3) of the Income Tax Act 1961 ('the Act') in the subject AY is unsustainable both on facts and in law.

A. LEGAL GROUNDS

2. The learned CIT(A) failed to appreciate that the Ld.AO under section 153C r.w.s 144C(3) of the Act is without jurisdiction and invalid as the transfer of the case was made without complying with the provisions of section 127 of the Act. Therefore erred in confirming the assumption of the jurisdiction by the Assistant Director of Income Tax (International Taxation)-1, Hyderabad ('the Ld.AO") u/s section 153C r.w.s144C(3) of the Act.

3. The assessment framed by the Ld.AO is without complying with the procedures prescribed u/s. 153C of the Act. Therefore, assessment is bad in law deserves to be quashed.

B. FACTUAL GROUNDS

4. Without prejudice to the above legal grounds, the Ld.CIT (A)

and the Ld.AQ failed to appreciate that there was no "Transfer" within the meaning of section 2(47) (v) of the Act since the possession of the land on the date of development agreement still vests with the Assessee. Therefore erred in taxing the capital gain on development agreement in the subject AY.

5. Without prejudice to ground no.4, that there is no transfer within the meaning of section 2(47)(v) of the Act during the subject AY, the Ld.CIT(A) failed to appreciate that the value of the land as per the Sub Registrar Office (SRO) is merely a guideline value for the purpose of the levy of stamp duty under the stamp Act and does not represent the Fair Market Value. Therefore, erred in confirming the SRO value of the land as on 01.04.2001.

6. The learned CIT(A) erred in holding that the assessee is liable to interest under section 234A of the Act as it is consequential in nature.

7. The Appellant craves to add, modify or amend the above grounds anytime during the course of appeal”.

3. Brief facts of the case are that, the assessee is an individual and non-resident, has not filed return of income for the assessment year 2016-2017. A search and seizure operation u/sec.132 of the Income Tax Act, 1961 [in short “the Act”] was conducted on 26.04.2018 in the case Sri K. Indra Sena Reddy, Hyderabad, wherein some incriminating material pertaining to the assessee was found and seized in the residential premises of the Sri K. IndraSena Reddy. Subsequently, the seized material along with Panchanama was forwarded to the O/o. Assessing Officer i.e., Assistant Commissioner of Income Tax, Central Circle-1(1), Hyderabad. Based on the information received, the Assessing Officer satisfied that, provisions of the section 153C of the Income Tax Act, 1961 were attracted in the case of the assessee as the satisfaction note recorded u/sec.153C of the Income Tax Act, 1961 [in short “the Act”] had bearing on the total income of the assessee for the assessment year 2016-2017. Subsequently, notice u/sec.153C of the Act was issued to the assessee by recording the reasons for reopen of the assessment. Subsequently, notices u/sec.142(1) and 143(2) of the Income Tax