TaxTMI 
TaxTMI 
TaxTMI 
2004 (10) TMI 28
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....nue had earlier moved the Income-tax Appellate Tribunal under section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), and the said application was rejected. Hence, the Revenue approached this court and in view of the order made by this court, the present reference is placed before the court. The assessee is an individual and was deriving income at the relevant time from money-lending business. The accounting year in question ended on March 31, 1983. The assessee vide sale deed dated July 25, 1958, for Rs. 21,021 had acquired a plot of land admeasuring 2,130.459 sq. mtrs. or 2,548 sq. mtrs. bearing No.C-1/2, Model Town, New Delhi-110 009, formerly known as village Malakpur Chhaoni within the limits of the Delhi Mu....
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....iod of 200 days from the date of execution of the agreement and as a security measure the assessee was to retain 1000 sq. yds. (836.13 sq. metres) area in her possession which was to be released and handed over to the builder and promoter on payment of the above sum of Rs. 12 lakhs. The remaining area in her possession was to be released by the assessee to the builder & promoter for development and construction; (iii) The balance of Rs. 5 lakhs was to be paid by the builder and promoter to the assessee within a period of 24 months or on the completion of the construction and on the date of registration of the sale deeds of the flats in favour of prospective buyers. (Clause 3)." Initially, the amount of Rs. 3 lakhs as advance money was pai....
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....ers were also to have undivided indivisible and impartible ownership rights in the plot in question in the ratio which the covered area of the old flats bore to the total covered area of all the flats taken together (clause 12). (12) If, during the construction of the group housing flats, any penalty, composition fee or fine were to be imposed by a competent authority, the same was to be borne and paid by the builder and promoter who was to keep the assessee harmless and indemnified against all action, claims, demands and losses, (clause 15)." Reliance was also placed on behalf of the Revenue on the decision of the Supreme Court in the case of G. Venkataswami Naidu and Co. v. CIT [1959] 35 ITR 594. The headnote at page 597, on which relia....
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....evant factors may help the court to draw an inference that a transaction is in the nature of trade; but it is not a matter of merely counting the number of facts and circumstances pro and con; what is important to consider is their distinctive character. In each case, it is the total effect of all relevant factors and circumstances that determines the character of the transaction. In cases where the purchase has been made solely and exclusively with the intention to resell at a profit and the purchaser has no intention of holding the property for himself or otherwise enjoying or using it, the presence of such an intention is a relevant factor and unless it is offset by the presence of other factors it would raise a strong presumption that ....
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....e laid down as a matter of absolute proposition that the onus is on the Department to prove that the initial intention of the purchaser was to resell the property." In this case, no one can raise a dispute about the principles laid down in these decisions. However, in both the decisions, we find altogether different facts so as to arrive at a conclusion or to reach at a different conclusion than what the assessee was contending in both the cases. In the case of ITO v. Rani Ratnesh Kumari [1980] 123 ITR 343 (All) the plot of land admeasuring 20,000 sq. yards was purchased and later on it was divided into sub-plots wherein improvements were made and by way of six sale deeds executed between the assessment years 1961-62 and 1972-73, the prope....