TaxTMI 
TaxTMI 
2023 (3) TMI 857
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....luded on 05.01.2021. The Bench, while dictating the order, came to know that the assessee had expired on 08.11.2020. His death certificate has been placed on record. Department was required to bring the legal heir of the deceased assessee on record and file a fresh Form 36. The file was released for enabling the Revenue to complete the formalities. However, Department failed to bring any material in this connection on the record inspite of repeated adjournments. It is an appeal pending more than four & half years and one amongst oldest appeals of the Kolkata Benches, and we have already been given more than 18 months time to the Revenue to complete the formalities. 3.1. Rule 26 of the Income Tax (Appellate Tribunal) Rules, 1963 (the ITAT Rules) provides a procedure for adjudication of such appeals where appellant or respondent expired during the pendency of appeal. The said Rule reads as under:- "26. Where an assessee whether he be an appellant or the respondent to an appeal dies or is adjudicated insolvent or in the case of a company being would up, the appeal shall not abate and may, if the assessee was the appellant, be continued by, and if he was the respondent be continued ....
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....were entitled to jointly receive two flats viz. flat Nos. A-3 and B-4 in the newly constructed property (in lieu of relinquishment of their respective tenancy right in the flats of the old building). The Ld. CIT(A) notes that the assessee's share of 50% in flat No. A-3 was reflected by way of flat of Rs.2,26,37,500/- in the Balance Sheet and the flat No. B-4 which was yet to be handed over was shown by way of Receivable of Rs.1,55,24,000/- from the Developer Concrete Developers Pvt. Ltd. (CDPL). 4.1. Assessee in his return had claimed the benefit of exemption u/s. 54F Act in respect of flat of Rs.2,26,37,500/- and, therefore, the Long Term Capital Gains (LTGC) was not offered to tax. However, according to AO, the assessee was not legally entitled to the benefit of exemption u/s. 54F of the Act and the entire amount of Rs.2,26,37,500/- was taxed by the AO. Aggrieved by the aforesaid action of the AO, assessee preferred an appeal before the Ld. CIT(A) who gave relief to the assessee and directed the AO to allow the claim of deduction of Rs.2,26,37,500/- u/s. 54F of the Act. Aggrieved by the aforesaid decision of the Ld. CIT(A), the revenue is in appeal before the Tribunal. 5. W....
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.... the said old property, it was agreed by the owner M/s. GSPL and the developer (M/s. CDPL) to allow two flats (A-3 and B-4) in the proposed newly constructed building to the assessee and his spouse. 5.3. Upon allotment of the flats A-3 and B-4 which were valued by a registered valuer and as per the valuation report the market value of flat No. A-3 worked out to Rs.4,52.75.000/- and the assessee's share being 50% was at Rs.2,26,37,500/- which was taken as consideration for the relinquishment of tenancy rights and the allotment of flat by the developer M/s. CDPL was taken to be investment of the sale proceeds in purchase of the new property. Therefore, on the transaction of the long term capital asset i.e. tenancy rights, assessee claimed the benefit of exemption u/s. 54F of the Act of Rs.2,26,37,500/- in respect of the cost of the flats allotted by the developer M/s. CDPL. As far as flat No. B-4 valued by the approved valuer was at Rs.l,55,24,000/- since it was not ready and no possession was given to the assessee during the year. Assessee credited Rs.3,81,61,500/- (Rs.2,26,37,500 + Rs.l,55,24,000) as accretion to its capital account. 5.4. The AO during the assessment proceedi....
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....d a separate person in the eyes of law. Merely because a relative of the appellant was on the Board of Directors of the company cannot be reason enough to allege that all the transactions between the appellant and the company were malafide. The facts on record clearly show that the property was at all times owned by M/s GSPL. The tenancy of the appellant and the fact that he was in occupation of the property since more than 30 years is also not in dispute. The rental receipts and the payment of rent through banking channels further established the monthly tenancy of the appellant. It is also quite unjustified to allege that a colorable device was enacted 30 years ago to avoid taxes. Taking into account the aforesaid facts, period of tenancy, pendency of disputes, litigation, arbitration etc. and human probabilities and circumstantial evidences, I am of the considered view that the transaction in question was not a colourable device." 6.2. In this respect, Ld. Counsel also referred to the sufficient evidence placed on record to prove the tenancy which the assessee and his wife enjoyed. These have already been stated in the facts above including payment of monthly rentals by cheque,....