TaxTMI 
TaxTMI 
2015 (10) TMI 534
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....see has income from house property, long term capital gain and income from other sources. During the assessment proceedings u/s 143(3) of the Income Tax Act, he called for various details and after verification of the details filed by the assessee, he accepted the income returned by the assessee. Thereafter, on a perusal of the assessment record of the assessee, the ld CIT observed that the assessment order is erroneous, in so far as it is prejudicial to the interests of the Revenue. He, therefore, issued a notice u/s 263 of the Act, dated 28.01.2014, pointing out the error in the assessment order. According to the notice u/s 263, assessee had purchased a semi furnished flat at Yousufguda, Hyderabad admeasuring 1536 sft including car parkin....
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....submitted that the consideration of Rs. 23,50,000 received towards sale of fixtures and fittings in a separate agreement is part of the consideration for the sale of the flat as fittings and fixtures and electrical fittings and interiors are integral and inseparable part of the residential flat and are also in the nature of the capital asset. It was submitted that it was at the request of the purchaser of the flat that the total consideration received for the flat was bifurcated between the sale of the flat and sale of fittings and fixtures etc, and that this arrangement does not automatically alter the character of the consideration received. Therefore, it was submitted that the total consideration of Rs. 51.50 lakhs received, was in respe....
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....ned CIT failed to appreciate the legal position that having accepted the income from such asset sold as income from Property now the department cannot take the stand it is not a capital asset to deny the right to claim deduction u/s.54. 5. The learned CIT further failed to appreciate the fact that the items that are sold are inseperable items and are not listed in the document through which they are sold and there is no basis to hold that what is sold is not a capital asset and therefore erred in holding that they are not capital asset. 6. The learned CIT ought to have appreciated the fact that the assets income from which are assessed under the head property are nothinq but capital assets and further that if not deduction u/s.54 dedu....
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....the head "Income from other Sources". The Appellant is in appeal before the Hon'ble Tribunal against this order. 3. The Appellant in the appeal memorandum has raised the grounds on the merits of the matter that sale proceeds of fixtures and fittings which form part of flat should be treated as capital asset, and the sale of the same results in capital gains. However, the Appellant has not taken the alternative ground that the entire amount of Rs. 23,50,OOO will go out of the purview of tax if the same are held to be 'not capital " asset' and therefore cannot be otherwise be taxed under the head 'Income from Other Sources'. The Appellant therefore with the leave of the Hon'ble Tribunal is raising the following addi....
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....9 ITR 383. Thus the ld Counsel for the assessee prayed for admission of the additional grounds of appeal. The ld DR however, opposed the additional grounds of appeal. 8. Having regard to the rival contentions and the material on record, we find that the additional ground of appeal raised by the assessee is a legal ground and further needs no fresh verification of facts. Therefore, in the light of the judgment of the Hon'ble Supreme Court in the case of NTPC (Supra), we are inclined to admit the additional grounds of appeal. The facts mentioned above are not disputed by either of the parties. As pointed out by the ld Counsel for the assessee even if the fittings and fixtures are not treated as part of the flat, as rightly pointed out ....