During F.Y. 2016-17 assessee sold a property for which he was not a real owner but had a power of attorney on his name.
Amount received from sale proceeds are received by assesee in form of account payee cheque on his name as real owner is not traceable.
Does any liability of capital gain or any other taxes arise for such transactions?
As per Section 2(47) of Income Tax Act, the term transfer include any transaction involving the allowing of the possession of any immovable property to be taken or retained in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882.
In the above case, if assessee had acquired the property in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882, by virtue of power of attorney assessee become the absolute owner of the property.
Therefore, In the above case, the liability to pay capital gain tax will be in the hands of power of attorney holder.