1984 (6) TMI 119

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....d in the purchase document that out of the total consideration of Rs. 58,000, Rs. 29,000 was being contributed by K. Ramanadham and the balance of Rs. 29,000 was being contributed equally by Smt. Nirmala and Smt. Pramila Devi. These persons held the land without making any improvements or modifications thereto and sales were effected on 28-12-1979 in 7 items. The aggregate consideration received was Rs. 1,23,700 and the particulars of the purchasers and the sale consideration received are as under : "Name of the purchaser Extent of site Sale consideration Sq. Yds. Rs. 1. Kum. V. Srikala, Suryapat 307 3,000 2. O. Prasada Rao, Govindarajulapet, 310 3,100 Warangal Dt. 3. Ch. V.M. Suresh, Hyderabad 301 3,000 4. B. Gopalakrishn....

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....stitute an AOP and further, since one of the members had been assessed, no action could be taken against the AOP. It was also contended that the surplus was income from capital gains. After discussing the various case laws on the point, the AAC held that since Smt. Nirmala had been assessed earlier in respect of her share, the ITO was precluded from making an assessment on AOP. On the point of the nature of the surplus, the AAC held that it was income from business. Eventually, the AAC gave two findings : (a) the ITO should assess the members separately taking their respective shares into account, and (b) the ITO was right in his conclusion that there was an adventure in the nature of trade from which surplus had resulted. 4. The revenue....

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....he stated, the three persons had joined together to earn income and, therefore, constituted an AOP. The learned counsel for the assessee, on the other hand, submitted that there was no such intention to earn income and throughout the share of each person in the property was specified. In this regard, a reference was also made to the provisions of section 45 of the Transfer of Property Act, 1882. 7. We have considered the rival submissions. Section 45 reads as under : "45. Joint transfer for consideration.--Where immovable property is transferred for consideration to two or more persons, and such consideration is paid out of a fund belonging to them in common, they are, in the absence of a contract to the contrary, respectively, entitl....