TaxTMI 
TaxTMI 
2006 (3) TMI 115
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.... involved herein is not a transfer falling within the definition under section 2(47) of the Income-tax Act, 1961, and in deleting the addition of Rs. 8,26,876/- assessed as short-term capital gains?" 2. The following facts are not in dispute: "The assessee has taken on lease an immovable property at No. 123, Usman Road, Madras, under a lease agreement dated September 6, 1985. Under that agreement, the assessee has to pay a sum of Rs. 10 lakhs to the lessor as interest-free advance; the lease is to be for a period of 22 years; rent for the first 15 years is fixed at Rs. 20,350/- per month and for the remaining seven years, the monthly rent payable is Rs. 84,428/-; there is a renewal clause; the assessee has subleased the property....
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....e Income-tax Appellate Tribunal in I. T. A. No. 4462/MDS of 1989 and the Appellate Tribunal agreed with the findings of the Commissioner of Income-tax. The assessment year concerned in this case is 1986-87. 4. Though the respondent has been served, they are neither appearing in person nor engaged any counsel. Heard the learned counsel appearing for the appellant. Learned counsel for the appellant, by taking us through the definition of "capital asset" in section 2(14) of the Income-tax Act, would contend that the property of any kind in the hands of the assessee, except those provided in that section itself, would be a "capital asset". Therefore the leasehold interest of the assessee is a capital asset. Then she took us through section 4....
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.... (Cal); (d) A. Gasper v. CIT [1991] 192 ITR 382 (SC); (e) A. R. Krishnamurthy and A. R. Rajagopalan v. CIT [1982] 133 ITR 922 (Mad); and (f) CIT v. Pramia Engineering Ltd. [1993] 202 ITR 298 (Cal). 6. Let us now examine the case on the merits. It is needless to state that transferring an immovable property by way of a lease creates an interest in the land. According to section 2(14) of the Income-tax Act, the words "capital asset" mean, "property of any kind held by an assessee". Therefore it does not necessarily mean that the property, which the assessee holds, must be his own. As per the above referred definition, any kind of property held by an assessee would come within the definition of "capital asset". It....
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....ub-lessee, he had extinguished his rights, as a result of which, the proposed party became the lessee of the property. The Calcutta High Court held that surrender of rights of the assessee referred to above would amount to extinguishment of his rights in the land/capital asset and therefore it attracts capital gains. This judgment was affirmed by the Supreme Court in A. Gasper v. CIT [1991] 192 ITR 382. In R. K. Palshikar (HUF) v. CIT [1988] 172 ITR 311 (SC), a Hindu undivided family was the assessee; they had agricultural lands belonging to an ancestor; later on, the property was developed into a residential zone; various extents of properties were leased for a period of 99 years and the lease document provided for termination of lease on ....