AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2015 (7) TMI 173
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....ies provided to the assessee no sale deed/purchase deed/proof of ownership of land/transfer deed was ever produced, meaning thereby, the assessee is not having any legal right/title over the property. Reliance was placed upon the ratio laid down by the Hon'ble Kerala High Court in227 ITR 490 (Kerala). 2.2. On the other hand, Dr. P. Daniel, ld counsel for the assessee, defended the conclusion arrived at in the impugned order by contending that whether ownership rights are necessary for calculating the gains for which our attention was invited to section 2(14) and 2(47) of the Act. It was pleaded that even no such requirement is there in section 45 of the Act that the assessee has to be the owner of the property. It was pleaded that the assessee occupying the property for the last about 20 years, therefore, it has to be assessed under the head capital gains. Reliance was placed upon the decision from Hon'ble Delhi High Court in the case of CIT vs Smt. Nilofer I. Singh (2009) 309 ITR 233 (Delhi) and also the decision in Madathil Brothers vs DCIT (2008) 301 ITR 345 (Mad.) 2.3. We have considered the rival submissions and perused the material available on record. The facts, in brief, ....
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....e defects where pointed out to the ld. AR for which no explanation have been provided. As the assessee has not furnished the purchase agreement and the sale agreement furnished have inherent lacuna, the same cannot be relied upon. The issue of valuation of property was referred to the Valuation Officer, Income Tax Department. Thane. The assessee has in spite of several opportunities being provided no purchase agreement has been furnished. Further. the assessee has also not produced these documents before the Valuation officer which is also a point worth nothing. The Valuation officer vide his letter dated 29.12.2010, filed in this office on 30.12.2010 has made certain observations. The relevant portion of the same is being produced here with: "The property was inspected by me on 17/12/2010. However the assessee has not furnished the complete details of the property.... However with the available details, the following figures for the tentative FMV are furnished herewith which are subject to change, if the assessee produces the required details. This is to prevent the assessee from taking undue advantage due to delay in assessment, by his not furnishing the required details." 4.2....
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....-. It is claimed that the assessee is co-owner of the shops. During the course of assessment proceedings, the assessee through his authorized representative was required to furnish the share in the commercial unit. As the assessee has railed to furnish the same it is assumed that the assessee is having 100% share and thus the assessee has said to receive an amount of Rs. 9,94,100/-. The assessee had sufficient time (from 18.08.2010 when the notice U/s 142(1) was issued to the date or order) to furnish copy of purchase agreement proving the ownership and the share thereupon. As the assessee has failed to furnish the documentary evidence in respect of his share In the commercial unit, the share of the assessee in the commercial unit is being taken at 100%. 2.4. Totality of facts clearly indicates that the assessee is neither the legal owner of the property nor was having any document showing any right/title in his favour and uncontrovertedly the land was meant for a primary school and the assessee illegally encroached upon such land. Before us, the only argument of the assessee is that ownership of the property is not a pre-condition for the claim of capital gains. We are not agreei....
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....ion of more than ten thousand but not exceeding one lakh; or (II) not being more than six kilometres, from the local limits of any municipality or cantonment board referred to in item (a) and which has a population of more than one lakh but not exceeding ten lakh; or (III) not being more than eight kilometres, from the local limits of any municipality or cantonment board referred to in item (a) and which has a population of more than ten lakh. Explanation.-For the purposes of this sub-clause, "population" means the population according to the last preceding census of which the relevant figures have been published before the first day of the previous year;]] [(iv) 6 per cent Gold Bonds, 1977,[or 7 per cent Gold Bonds, 1980,] [or National Defence Gold Bonds, 1980,] issued by the Central Government ;] [(v) Special Bearer Bonds, 1991, issued by the Central Government ;] [(vi) Gold Deposit Bonds issued under the Gold Deposit Scheme, 1999 notified by the Central Government.] [Explanation.-For the removal of doubts, it is hereby clarified that "property" includes and shall be deemed to have always included any rights in or in relation to an Indian company, including rights of manag....
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....he assessee before the court and in terms of the compromise memo filed in the suit, a decree was passed on September 30, 1983, in favour of the assessee. Although as part of the settlement terms, the parties agreed to revise the sale consideration this was done with reference to the claim under the agreement. The sale deed was executed in terms of the settlement reached in the suit proceedings. As such there was no novation of contract to result in a fresh agreement entered into. The assessment had to be made treating the gain as long term capital gains arising out of the sale of the immovable property." 2.7. If the aforesaid conclusion/facts are analyzed admittedly, the assessee was put in possession and enjoyment of the suit property as agreement holder right from January, 1, 1976 and suit for specific performance was filed before the Court in terms of compromise memo filed in the suit and thus decree was passed on 30/09/1983 in favour of the assessee. The assessee was in lawful possession of a document/agreement to sale. In that situation, the assessment was held to be made treating the gain as long term capital gains arising out of sale of immovable property. However, the fact....
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....Under the charging section, the crucial requirements are that there must be a transfer and such transfer must be of a capital asset. The implication is that at the time of transfer, the subject of transfer must be a capital asset as was held by Madras High Court in M. Venkateshan vs CIT (1993) 144 ITR 886 (Mad.). If this ratio is applied to the facts of the present appeal, it is clear that there is no transfer of asset as such rather, as mentioned earlier, the primary school land was encroached upon/illegally occupied by the assessee and as such there is no transfer of capital asset, thus, under the present facts, it cannot be extended to such an extent as has been claimed by the assessee. In our humble opinion, the word used in the section as 'any kind' means land, building, conveyance of property ( CIT vs Tata Services Ltd.-122 ITR 594-Bom.), mortgage (Bafna Charitable Trust vs CIT-230 ITR 864 Bom.), share in firm (V. Rangaswami Naidue vs CIT -31 ITR 711- Mad.), an undertaking (Indian Bank Ltd. vs CIT 153 ITR 282- Mad.), running business (CIT vs F.X. Periera & Sons (T.) (P.) Ltd. 184 ITR 461-Ker.), route permits (Addl. CIT vs Ganpati Raju Jegi, Sanyasi Raju-119 ITR 715-AP/S.Vaidy....
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....therefore, the inference has to be drawn on cumulative consideration of all the relevant facts, supports our view. Under the facts available before us, if such a liberal/extended meaning is assigned to the word "any kind" then it will defeat the very purpose of the legislation and will enlarge the scope of unscrupulous persons to grab the government property or property of any person and after some time he/she may take the plea that such property has been shown in his/her balance sheet and also paid "capital gains tax" to the Income Tax department, therefore, it may be legally transferred in his name thereafter. In our humble opinion, such leverage cannot be extended to the assessee under the facts available before us. 2.12. If this issue is analyzed with respect to section 45 of the Act. Capital gains accrues only if there is a sale or any transfer of the capital asset. If the assessee satisfies the Assessing Officer on the basis of a sale deed/transfer document only then conclusion can be drawn that any gains has accrued. However, in the present case, neither any sale or transfer of the property/asset took place, therefore, there is no question of capital gain. The ratio laid do....