2013 (4) TMI 860

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.... 18,48,790/- by treating the same as capital receipt as against income from house property treated by Assessing Officer? 2. Whether in the facts and circumstances of the case, CIT (A) has erred in treating assessee's share of receipts from ANZ Grindlays bank who was tenant of assessee as mesne profit/damages not liable to tax when the same should be treated as income from house property? 3. The appellant craves leave to add, alter or amend any/all the grounds of appeal before or during the course of hearing of the appeal." 3. The brief facts of the case are as under :- A sum of Rs. 79.20 lacs was received by the co-owners, namely, Shri Jagdish Goyal, Shri Vinod Kumar Goyal, Shri Ashok Goyal and assessee Shri Sandeep ....

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....: (1) That the Hon'ble Supreme Court in the case of P. Mariappa Gounder (supra) was not concerned with the issue whether the mesne profit received against the wrongful possession of the property is in the nature of revenue receipt or capital receipt. The only issue before the Court related to the year of taxability. Hence, it cannot be said that the Hon'ble Supreme Court adjudicated upon the issue relating to the nature and character of the receipt by way of mesne profits. (2) That the amount received against wrongful possession of the property amounts to mesne profits whether determined by the court or under a consent decree within the ambit of section 2(12) of the Code of Civil Procedure, 1908. (3) There....

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....of the property and therefore capital receipt not chargeable to tax. There is no judgment of the jurisdictional High Court on this issue. In our view, such conflict can be resolved only by the Hon'ble Supreme Court in some appropriate case. In the absence of the judgment of the highest of land or of the jurisdictional High Court, the legal position is that where there are two views then the view favourable to the subject should be preferred. Reference can be made to various judgments of the Apex Court: CIT v. Vegetable Product Ltd. [1973J 88 ITR 192. CIT v. Naga Hills Tea Co. Ltd. [1973J 89 ITR 236, CIT v. Madho Prasad fatia [1976J 105 ITR 179, CIT v. J.K Hosiery Factory [1986J 159 ITR 85, Smt. Shashi Gupta v. LIC of India [1995J 84 Com....