This Mumbai-based case involves Shri Nishant Laxmikant Mehar and his wife, Mrs. Parnal Nishant Mehar. It serves as a cautionary tale for countless Indian families who add a spouse’s name to property documents for emotional or security reasons, without realizing the potential long-term tax consequences.

Chronological Timeline of Events

• 2015–16 (Financial Year / Assessment Year 2016–17): The couple sold an immovable property (likely a residential flat) for a total consideration of ₹1,39,75,000 (approximately ₹1.40 crore). The registered sale deed listed both Shri Nishant Laxmikant Mehar and Mrs. Parnal Nishant Mehar as joint owners. As per arguments presented later, Mrs. Parnal Nishant Mehar’s name was included solely “out of love and affection”—a common, sentimental practice in India where a spouse’s name is added to the title for bonding, future security, or tradition, even if she made no financial contribution and held no actual beneficial interest in the property.
• September 21, 2016: Shri Nishant Laxmikant Mehar filed his income tax return for AY 2016–17, fully declaring the ₹1,39,75,000 sale consideration. He computed and paid tax on the entire long-term capital gain, treating himself as the real/beneficial owner.
• Mrs. Parnal Nishant Mehar did not file her own return for the year, presumably because she viewed her inclusion in the deed as nominal and non-taxable.
• March 14, 2023: Nearly seven years later, the Income Tax department flagged the transaction through data sources (such as property registration records or Annual Information Returns). They also noted unreported salary income from Jet Airways (India) Ltd. Believing income had “escaped assessment,” the department reopened Mrs. Parnal Nishant Mehar’s case under Section 147 and issued a notice under Section 148.
• 2023–2024: Despite several follow-up notices and a show-cause letter, there was no response or appearance from Mrs. Parnal Nishant Mehar. The Assessing Officer (AO) proceeded ex-parte and passed the assessment order on January 31, 2024 (under Sections 147, 144, and 144B):
  • Noting the joint names on the sale deed without specified shares, the AO applied the standard presumption of equal (50:50) ownership in husband-wife cases.
  • Attributed 50% (₹69,87,500) of the sale value to Mrs. Parnal Nishant Mehar.
  • With no evidence submitted on her cost of acquisition (purchase price or indexed cost), it was taken as zero.
  • The full ₹69,87,500 was taxed as long-term capital gain in her hands.
  • An additional ₹17,00,240 salary from Jet Airways was included.
  • Total assessed income: ₹86,87,740 — resulting in a substantial tax demand, with roughly ₹70 lakh linked to the capital gains portion.
• 2025: Mrs. Parnal Nishant Mehar appealed to the Commissioner of Income Tax (Appeals) – National Faceless Appeal Centre (NFAC), Delhi. The appeal was dismissed on September 2, 2025, purely on technical grounds: failure to pay the prescribed advance tax/fee under Section 249(4).
• 2025–2026: The case reached the ITAT Mumbai “C” Bench (comprising Shri Vikram Singh Yadav, Accountant Member, and Shri Sandeep Singh Karhail, Judicial Member). After hearings, the final order was pronounced on March 9, 2026 (ITA No. 8389/Mum/2025; a duplicate physical filing was dismissed as unnecessary).

Key Arguments and ITAT Ruling

Counsel for Mrs. Parnal Nishant Mehar submitted:

• The entire sale proceeds were already declared and taxed in Shri Nishant Laxmikant Mehar’s 2016 return.
• Her name was added only “out of love and affection,” with no real ownership or contribution.
• Taxing the same transaction again would constitute impermissible double taxation.

The Tribunal found strong merit in these points:

• The husband’s return was filed in 2016—well before reassessment proceedings against the wife in 2023.
• The same capital gain cannot be taxed twice if fully offered by the beneficial owner.
• On the salary addition, it appeared duplicated and already subjected to tax deduction at source (TDS), as evidenced by Form-16 (₹8,59,720 salary; ₹20,030 TDS).

Final Outcome: The appeal was allowed. The ITAT set aside the assessment and remanded the matter back to the Assessing Officer strictly for verification:

• Confirm the husband’s ITR declaration and tax payment on the full ₹1,39,75,000.
• Verify the Jet Airways Form-16 for salary and TDS.
• If facts are corroborated, grant complete relief by deleting both additions—likely reducing the tax demand to zero or near-zero.

Broader Implications: The “Love and Affection” Pitfall

Adding a family member’s name to property deeds “out of love and affection” is a routine practice in India, often done without legal advice. However, income tax law prioritizes legal title over intent:

• Unspecified shares in joint deeds frequently lead to a 50:50 presumption.
• Delayed data matching can trigger reassessment notices years later (up to 10 years in some cases).
• Non-compliance with notices results in harsh ex-parte orders.

Recent ITAT rulings (including Mumbai bench decisions) have clarified that mere legal title does not always trigger capital gains tax if evidence proves one party as the beneficial owner and the addition was nominal. Yet, as this case shows, ignoring notices can inflate liabilities dramatically.

Experts advise: Document such arrangements clearly—via affidavits, relinquishment deeds, or explicit share mentions—to safeguard against future disputes.

This real Mumbai case highlights how a gesture of love can unwittingly invite tax scrutiny, emphasizing the need for proactive tax compliance and proper paperwork in family property matters.

Also Read: Income Tax Tribunal Rules: Redevelopment Gains Not Taxable for Housing Societies; Crucial Shield for Flat Owners

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The Controversy That Started in 2016

In February 2016, Preity Zinta sold her luxury apartment at Quantum Park, Union Park, Bandra (West), which was registered in three parts (in her name, her mother’s name, and her company’s name) for a total consideration of ₹7.13 crore. Around the same time, ₹13.10 crore was credited and debited from a newly opened Corporation Bank account within days, triggering alarm bells in the Income Tax department’s investigation wing.

The Assessing Officer alleged that the transactions were “sham and circular” – money routed through entities linked to businessman Danish Merchant to introduce unaccounted income – and added ₹10.84 crore as unexplained cash credits under Section 68.

What Really Happened: Loan Restructuring, Not Money Laundering

The Income Tax Appellate Tribunal (ITAT) “I” Bench, Mumbai, in its detailed 17 November 2025 order, accepted Preity Zinta’s explanation:

• She had borrowed large sums from Danish Merchant and his group companies (Ace Light Hospitality, Ace Links, Ace Housing) during 2012–2015 due to financial distress.
• The Quantum Park flat was mortgaged as security for these loans.
• In 2016, to avoid violation of Sections 184 & 185 of the Companies Act (which restrict companies from giving loans to individuals), Merchant insisted the loan be shifted from his private limited company to his partnership firm (Ace Links).
• The flat sale proceeds and fresh loans from Ace Links were used to square off the old loan – a pure restructuring, not infusion of black money.

The Tribunal noted that identity, creditworthiness, and genuineness of all transactions were fully proved with bank statements, registered sale deeds, confirmations, and audited accounts.

ITAT’s Final Verdict: Complete Clean Chit

The bench comprising Vice President Saktijit Dey and Accountant Member Girish Agrawal held:

“The transactions are genuine… Assessee has not derived any benefit… It merely resulted in transferring liability from one entity to another. No addition is called for.”

The entire ₹10.84 crore addition was deleted. All legal grounds (reopening validity, limitation, jurisdiction) became academic.

Preity Zinta’s Long Legal Battle Ends

This was the second round of litigation at ITAT. The actress had already declared capital gains on the flat sale and paid tax on it in her original 2016 return. The department’s reopening in 2021 and subsequent additions through the DRP route have now been quashed.

Also Read: Amitabh’s Pratiksha Bungalow Has A New Owner

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By Varun Singh

MahaRERA Chairman, Ajoy Mehta bought the Samata Apartment flat in October 2020, within a month his son Shivaji bought another apartment in Prabhadevi.

The flat that Ajoy Mehta’s son bought measures 750.92 sqft carpet area and 1300 sqft built-up area, and the total amount paid for this flat is Rs 2.86 crore.

The flat is located on the 10th floor of the building named Sidhivinayak Horizon, Prabhadevi. The documentation for the deal was carried out on November 2, 2020, while the registration was done on November 6, 2020.

The flat was sold by Sachin Khanolkar and his wife (the current sellers). Mehta’s son while registering the apartment, gave the address of the Samata Apartments.

A detailed SMS sent to Ajoy Mehta seeking his and his son’s comment got us no response. Mehta in the past has occupied the chair of BMC commissioner, state’s Chief Secretary, and even that of the Principal Advisor to the Chief Minister, Uddhav Thackeray.

About the flat.
The flat was bought by the current seller Sachin and his wife via an agreement for sale dated February 2, 2012, admeasuring 1300 sqft of the built-up area including balcony.

Under an agreement for sale dated March 26, 2016, between the current sellers and one D K Saigal, the current sellers had agreed to sell the flat to Saigal.

Saigal then leased out the apartment via a leave and license agreement dated March 20, 2018. This agreement commenced on April 1, 2018, and was to expire on March 31, 2021.

The sale between the current sellers and Saigal was to be completed within a period of 373 days from the date of agreement that is March 26, 2016. However, the deal couldn’t be completed hence after due discussion the parties mutually agreed not to proceed with the sale transaction and canceled the agreement dated March 26, 2016.

A cancellation deed dated October 27, 2020, was registered between both parties. Even the leave and license agreement was canceled.

After this Ajoy Mehta’s son bought the apartment from the current sellers and registered the deal on November 6, 2020.

Payment
Prior to the execution of the agreement, the buyer paid to the sellers the entire agreed consideration by a cheque dated November 5, 2020, for Rs 24 lakh and by an RTGS of Rs 2,59,85,500 (Rs 2.59 crore). TDS of Rs.2,14,500 (Rs 2.14 lakh) was to be deposited with the income tax department.

The flat was put on rent the same day of registration
On November 6, 2020, Ajoy Mehta’s son gave the apartment on rent for a period of two years to the tenant with whom Saigal had carried out leave and license agreement earlier. The rent per month for the first year is Rs 1.38 lakh, for the second year, it is Rs 1.46 lakh per month.

Stamp duty paid by Transferor
All expenses towards stamp duty and registration charges were borne and paid by the transferor in this case the sellers alone. The transfer premium charged and chargeable by Siddhivinayak Horizon and any other charges were also to be paid by the transferor alone without recourse to the transferee.

A stamp duty of Rs 5.72 lakh was paid for the registration of the flat. Along with the flat, the buyer got access to two car parks in this building.

Plot owned by Municipal Corporation
Prior to the year 1995, the plot of land owned by the Municipal Corporation of Greater Mumbai was occupied by various slum dwellers. With the intention of redeveloping the Slum under the provisions of DCR 33(10), the slum dwellers incorporated a housing Society in the name of Akanksha SRA cooperative housing society limited. The society appointed Siddhivinayak Construction Private Limited as the developer for effecting redevelopment of the slum.

The developer was issued a letter of intent dated July 26, 1996, by the Slum Rehabilitation Authority for the redevelopment. After obtaining the necessary building permission the developer effected the redevelopment and constructed on the municipal slum land various units forming part of the rehabilitation component as well as the free sale component.

The building constructed by the developer on the land comprising of free sale units is known as Siddhivinayak Horizon the Slum Rehabilitation Authority issued an occupation certificate dated August 21, 2007, for the sale building.

Nariman Point Deal
In October 2020, Ajoy Mehta bought the flat located on the 5th floor of Samata Co-operative Housing Society, on General Jagannath Bhosale Marg near Mantralaya, Nariman Point. The carpet area of the flat is 1,076 square feet and he had paid Rs 5.3 crore for the apartment.

Also Read: Avinash Bhosale Buys Rs 103 Crore Duplex In Mumbai

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By  Ravi Singhal

If you are buying home first time, you are entitled to get Income Tax benefits on home loan under three sections- Section 80C, Section 24 and Section 80EEA of Income Tax Act.

These sections of Income Tax Act let you avail home loan benefit of Rs 5 lakh annually.  Let’s understand with this detailed chart of Income Tax sections: –

Now, let’s consider a scenario that you have purchased a property in April 2021, property value is Rs 50 Lakhs and you have taken 80% loan i.e. Rs 40 lakhs on it from a financial institution (Bank or NBFC) at interest rate of 7% for 20 years. Now your monthly EMI would be around Rs 31,000 and you have to pay a total amount of Rs 3,72,000 in first year, out of which Rs 2.77 lakhs is interest component payment and Rs 95,000 is principal component amount. Suppose your annual earning is Rs15 Lakhs annually, in that case you can claim Rs 95,000 (principal payment) deduction under 80C (remaining Rs 55000 of 80C can be claimed from stamp duty payment, valid for only first year), Rs 2,00,000 under section 24 and remaining Rs 77,000 interest amount under Section 80EEA.

So, first year you can take tax deduction benefits of Rs 4.27 lakhs. Moreover, principal and interest paid components against home loan EMIs change every year, so it is suggested that check it in advance before you do your tax planning.

Tax benefits for second time home owner: If you already own a property and wish to buy another then tax benefits under 80EEA cannot be claimed. In the above example now you can claim Rs 95,000 under 80C (plus 55000 Rs.  against stamp duty paid in first year) and 2,00,000 Rs. under Section 24. However, if the purpose of home is investment and you want to lease it on rent, in that case you can claim full amount of interest component in section 24, which is Rs 2.77 lakhs in above case.

If woman member of the family invests in house: As per income tax laws, there are no specific benefits in case  a woman invests in house. She can claim all the above mentioned benefits under income tax laws similar to man. However, some state governments have given 1%-2% benefit of stamp duty if woman is the owner of house. Like in Rajasthan, if you buy a house of amount Rs 40 Lakhs then in general case the stamp duty (including other charges) is 8.8% which is Rs 3,52,000, but if any a female member of the family buys this house then she has to pay 7.5% stamp duty, which is Rs 3,00,000. So, there is one-time saving of Rs 52,000 if a woman buys the same house.

Tax benefits for husband-wife or joint purchase: If both husband and wife purchase house jointly, the income tax benefit rules remain the same in that case, however, both husband and wife can claim tax benefits in their individual files. Maximum deductions benefits cannot cross the actual amount paid, i.e. both husband and wife cannot take benefit of same payment. For example, the interest component is Rs 2.77 Lakhs and husband has taken tax deduction benefit of Rs 2 Lakhs under Section 24, then wife can only take benefit of Rs 77,000 under section 24, benefit taken against interest component can never cross Rs 2.77 lakhs, which is the actual paid amount. Similarly, Rs 95,000 is paid against principal payment, so if they want to take benefit under Section 80C so either husband or wife can take full benefit of Rs 95,000, if they want, they can split the amount as per their tax planning, but full amount benefit cannot be taken in both accounts.

Note:  Ravi  Singhal, is Vice Chairman, GCL Securities Limited, views expressed are that of his own.

Also Read: Follow these steps when buying a flat in RERA registered projects

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By Varun Singh

Mumbai’s real estate market has performed very well especially in the last three months. To be specific since the stamp duty cut that was announced by the state government.

To give perspective to the above statement one can see that in 17 days of November 2020, Mumbai had taken over entire November 2019’s sales.

What had added to the high sales apart from the stamp duty cut was the discounts that developers were offering home buyers,

The fear that crops up in ones mind is that will developer hike the home prices because the market is doing good?

If this gives any relief to home buyers and the market, it is most unlikely that developers will hike the prices.

One of the examples to substantiate this claim is the recent announcement by Ashok Mohanani, President, NAREDCO Maharashtra. NAREDCO had announced that in 1,000 projects of their members, zero stamp duty will be available till December 31.

In present system, circumstances and liquidity crunch do not allow any developer to increase prices. As such it is likely remain stagnant.

Anand Gupta , Chairperson , Housing and Rera committee Of Builders Association Of India.

We posed the same question to Deepak Goradia, President, CREDAI MCHI whether prices will go up.

According to Goradia, in the current scenario too, developers are facing a lot of hardship. Projects are still unviable for many, but they are continuing without passing the burden on to the home buyers.

Many developers are still continuing with their festive offers and according to most of them not much from their side would change till the end of this financial year.

Hiral Sheth, Director-Marketing, Sheth Creators, when asked the question whether prices may go up? She said, “While it’s difficult to comment on market prices as they depend on many criteria, developers are being support of home buyers by offering various payment schemes and other discounts. Thus encouraging more fence sitters to take the plunge.”

The general economy is still reeling under the pressure of job losses and salary cuts.

However, what has boosted the real estate sales is also home loans at the lowest interest rate in the recent past. “One thing we can surely say that the markets have picked due to several reasons such as better home loan rates, stamp duty reduction , changes in the income tax margin on circle rates,” says Developer Tejas Vyas.

On the question of price, Vyas says, “Price improvement is directly proportional to the momentum of sales. In the last 3 months we have seen unprecedented momentum. We will have to see how far this momentum picks up before judging the price rise.”

The general feeling amongst most developers shows that price rise may not happen anytime soon, in spite of the market seeing good sales. Instead the discounts and waivers will continue for some more time, till the economy is back on track.

Another reason why most developers won’t take the risk of hiking prices is because the sales is based on several aspects and their offering discounts is one of the biggest apart from the slashing of stamp duty and lower interest rates.

Also Read: 1000 Projects Offer 0% Stamp Duty Till Dec 31 In State

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By Varun Singh

Piyush Goyal, Union minister who holds vital portfolios in the Modi government asked developers to reduce prices to survive. Builders meanwhile, want government to make laws that shall not further tax them or home buyer for selling and buying at lower prices.

Why is this statement important in the current times, because Goyal may not be the first to ask so, but he probably is the first minister to explicitly tell developers that they should reduce prices.

According to sources it was a closed door webinar, but a video of the minister asking developers to reduce prices surfaced on social media. Some even tweeted the video and it was making rounds on the social messaging apps.

During the webinar with developers body NAREDCO, Goyal, said, “Unless you reduce your rates, believe me you are stuck with your material, you can choose to be stuck with the material and default with bank and then the material goes away, or you can choose to get rid of whatever you bought at high prices, look at this as a bad decision or an unfortunate situation and move forward.”

Goyal was to the point with his remarks, he further told the developer community that things are seriously stressed and builders best bet is to sell.

“If any of you here feels that government will be able to finance in such a way that you can hold longer and wait for the market to improve, market is not improving in a hurry, things are seriously stressed and your best bet is sell,” said Goyal.

He also advised builders to get rid of bank loans. Goyal said, “Those who have sold, leveraged less or got rid of their bank loans have survived this downturn, those who are saddled with large loans, who kept holding on to their price have suffered. My conscience is clear, because in every interaction of mine, I have said this point.”

According to Dr Niranjan Hiranandani, President, NAREDCO, the government should change laws, which penalizes the seller and buyer when they sell or buy at less than ready reckoner rates.

“The moment we sell at a price that is 10 per cent lower than the ready reckoner rate, both the seller and the buyer are penalized under Income Tax Act. The government should either reduce the ready reckoner rates or amend the Income Tax Act,” said Hiranandani.

Actually Hiranandani does have a point. To explain this further, Sumeet Mehta, Chartered Accountant and CEO, Paradigm Advisors said, “As per Section 43CA of Income Tax Act, 1961, if any developer sells his inventory at a discount of more than 10 per cent of the ready reckoner valuation of the said property, then the developer will have to pay tax on the discount allowed. This is because the law states that in such situations when the sale price is lower than ready reckoner price by more than 10%, then the ready reckoner price must be considered to be the sale price and tax paid on the said notional value.”

According to Mehta, if that is not enough, the Government has made the same difference between the sale price (here purchase price in the hands of buyers) and ready reckoner price, taxable as income in the hands of the buyer under Section 56 (2)(x) of Income Tax Act, 1961.

“This results in double taxation of the same amount, first time in hands of developer as a tax on notional income, and then in hands of buyer as tax on discount earned presumed to be an income,” said Mehta.

Many builders claim that such populous statement are made very often these days, but without any concrete action from the government side, nothing will help the realty sector.

“I am ready to sell at a lower price, but without financial assistance to the sector will there be a buyer? If the government doesn’t reduce home loan interest, doesn’t give some waiver in GST and stamp duty, why would anyone come to buy in such a market, where are the customers? Assistance is required in uplifting the customer sentiments to at least get them to the table for negotiations,” said a developer who didn’t wish to be named.

Also Read: Price reduction not solution, research by builder body

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