TaxTMI 
TaxTMI 
TaxTMI 
2010 (9) TMI 1086
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....nsideration of ₹ 2,00,00,000/-. The sale proceeds were invested in the acquisition of a Villa in Madh Island near Mumbai for ₹ 2,04,00,000/-. The assessee computed the capital gains on the sale of the agricultural land at ₹ 1,79,19,535/- but claimed that she was entitled to deduction u/s.54F since the sale price has been utilized for buying a new residential house in Madh Island. 3. The A.O. noticed that the assessee had not actually purchased the new house [Villa No.1, Casa Marbella, Erangal, Malad (W), Mumbai] but has only acquired a lease of the house under the document entered into with M/s. K. Raheja Universal Pvt. Ltd. He further observed that the assessee was described as a 'lessee' in the document. The purchase pr....
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....issed the appeal. 5. The assessee is in further appeal before the Tribunal. The learned counsel for the assessee drew our attention to sec. 27(iiib) read with sec. 269UA(f) of the Act and submitted that under these provisions, any person who acquires any rights, excluding the monthly lease rights or a lease for a period not exceeding one year, with respect to any building or part thereof, shall be deemed to be the owner of that building or part thereof. He drew our attention also to the judgement of the Delhi High Court in Addl. CIT vs. Vidya Prakash Talwar (1981) 132 ITR 661, where it was held that for the purpose of understanding the meaning of the expression "house property" as used in sec. 54, the concept of house property under sectio....
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....as to be construed liberally having regard to its objects. Reliance in this behalf was also placed on the judgement of the Supreme Court in the case of CIT vs. T.N. Aravinda Reddy (1979) 120 ITR 46. 6. As regards the character of the property, whether it was residential house or commercial premises, it was submitted that the premises consisted of 2 bed rooms, a living room, kitchen, etc., and in the records of BMC, as per the Occupation Certificate, it has been described as "residential bungalow". The other Villas in the same complex have also been given the status of residence. The copy of the electricity bill produced before the CIT(A) categorizes the premises as 'residence' and not as 'commercial property'. In the income-tax returns of ....
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....that the lessor shall be entitled to utilize the entire FSI of the property subject to the right of the lessee to utilize 10,000 sq. ft. on the demised premises. It was the responsibility of the assessee to maintain the Villa and the surrounding land and to carry out internal and external repairs and painting at her own cost. It was the assessee's responsibility to keep the property insured. She was prohibited from using the premises for any purpose other than for private residence. She was obliged to permit the lessor's servant to inspect the Villa from time to time and also for the purpose of carrying out repairs affecting the other areas of the premises. On the expiration of the lease, the assessee was to quietly and peaceably return the....
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....was held that there was transfer of capital asset to the lessee and capital gains tax was attracted. These two judgements are in the context of the lessor's tax liability for capital gain. The corollary of these two judgements, in our humble understanding, is that the lessee would acquire the leased asset with full rights of enjoyment and possession during the period of lease which, in the present case, is 99 years as in the case of Palshikar (HUF) (supra). Applying, with respect, the ratio of the aforesaid two judgements of the Supreme Court, we hold that the assessee had purchased the Villa and thus satisfied the conditions of sec. 54F. 9. The property had been erroneously described as 'commercial premises' by the AO. As we have already ....