TaxTMI 
TaxTMI 
1978 (3) TMI 4
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....tal gains assessable under section 45(1) of the said Act for the assessment year 1967-68 ? " The assessment year is 1967-68 for which the previous year ended on 31st March, 1967. The assessee is an individual and derived income practically from all sources including income from sub-letting premises No. 240E, Acharya Jagadish Bose Road, Calcutta (hereinafter referred to as the said " property "). In the course of the relevant assessment proceeding the ITO noticed in Part IV of the return of income reference to a sum of Rs. 2,25,000 received by the assessee from M/s. Associated Battery Makers (Eastern) Ltd. (hereinafter called " Associated Batteries "). On enquiry, he learnt that the assessee was a monthly tenant since 1940 of the said property under Kumar Biswanath Roy and others (hereinafter referred to as " the landlords "). He also found that the landlords entered into an agreement for lease dated March 27, 1967, with the Associated Batteries permitting them to construct a building on the said premises and the assessee was also a party to the said agreement. The assessee contended before the ITO that the sum of Rs. 2,25,000 received by him was partly for the damages to b....
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....hich a receipt dated 15th March, 1967, granted by the Associated Batteries to him was produced by him before the Tribunal. The arguments made on his behalf before the AAC were also reiterated before the Tribunal. It was further contended that his previous monthly tenancy under the landlords was not a transferable property because, according to him, the said tenancy was governed by the West Bengal Premises Tenancy Act, 1956, and as such it was not a capital asset within the meaning of s. 2(14) of the I.T. Act, 1961, and was also not a transferable asset and accordingly no capital gains had arisen out of its transfer or extinguishment. The Tribunal found that the assessee with the consent of the landlords had transferred his monthly tenancy and his leasehold interests in the said property to the Associated Batteries on 15th March, 1967, on receiving Rs. 2,25,000 from the Associated Batteries, out of the total consideration money of Rs. 4,50,000 on that date and ceased to be a tenant under the landlords on the same date and became a licensee under the Associated Batteries which was apparent from the aforesaid receipt. The Tribunal also found that the quantum of the aforesaid con....
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....tinue to occupy the remaining portion of the ground floor of the said premises as a licensee under Associated Batteries until such time as the under-lease mentioned in clause 7(ii) hereafter is granted. He will pay such fees as compensation to Associated Batteries as may be agreed between him and Associated Batteries". "7. It is agreed between the parties hereto that as soon as the architect shall certify that the entire new building is fit and ready for occupation the following grants shall be executed and accepted, that is to say : (i) the landlords will grant to Associated Batteries a lease of the land and portion of the new building described in and otherwise in the form and terms of the draft set forth in the second schedule hereto ; (ii) Associated Batteries will grant to Mr. Gasper an under-lease of the portion of the new building described in and otherwise in the form and terms of the draft set forth in the third schedule hereto. " Mr. Banerjee, who also appeared before both the appellate authorities, argues before us that the aforesaid clauses of the agreement conclusively show that on 15th March, 1967, the assessee was a tenant under the landlords and was not ....
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....dest amplitude. He also argued that the finding of the Tribunal, namely, that the tenancy of the assessee was governed by the Transfer of Property Act and not by the West Bengal Premises Tenancy Act, 1956, is a mixed question of law and fact. It has not been challenged by the assessee by raising an appropriate question; therefore, Mr. Sengupta argues, that it is binding on the assessee. Mr. Sengupta further argues that the creation and determination of a monthly tenancy are governed by the Transfer of Property Act and not by the West Bengal Premises Tenancy Act, 1956, which confers certain rights and liabilities on the landlords and tenants regarding the tenancy. It is his submission that the West Bengal Premises Tenancy Act, 1956, does not prohibit the transfer of any tenancy and that it merely imposes a condition to be fulfilled by the tenant before transferring his tenancy. He also argues that the assessee claimed before the Tribunal that he had no right to transfer his tenancy in view of s. 14 of the West Bengal Premises Tenancy Act, but he has utterly failed to discharge the onus in this regard which lay on him. Mr. Sengupta further argues that it has been found by the Trib....
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....ertain conditions specified in it. Where a tenant has obtained the previous consent in writing of the landlord to transfer his rights and interests in the tenancy, he is entitled to transfer it in view of s. 14(1)(b) of the West Bengal Premises Tenancy Act, 1956. Hence, transfer of the rights and interests of a tenant in the tenancy is not absolutely prohibited and, therefore, it must be held that even where a tenancy is governed by the West Bengal Premises Tenancy Act, 1956, such tenancy is a transferable property. The West Bengal Premises Tenancy Act, 1956, does not also take away the right of the landlord and the tenant to agree to determine or extinguish the tenancy. It has been found by the Tribunal as a fact that by a tripartite agreement on 15th March, 1967, the tenancy of the assessee under the landlords was extinguished and he became a licensee under the Associated Batteries. It was also the case of the assessee that he was no longer a tenant under the landlords and became a licensee of the Associated Batteries and remained in possession as such licensee by paying Rs. 350 per month to the Associated Batteries. The Tribunal has also found it as a fact that on 15th March,....
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....lf that the transfer of his monthly tenancy or leasehold estate and interest was invalid. The Tribunal also did not express any opinion in this behalf. Therefore, the aforesaid plea is a new plea and it does not arise out of the order of the Tribunal, nor is it another aspect of any one of the questions before us. In the premises, Mr. Banerjee cannot take the aforesaid new plea. That apart, Mr. Banerjee cannot be heard to say that no such document was executed by the assessee nor has this court any power to hold that no such document was executed by the assessee. The assessee is bound by the facts stated and found by the Tribunal which is the final fact-finding authority. It is also settled law that the High Court in their advisory jurisdiction must proceed on the basis of the facts found and stated by the Tribunal. The finding of the Tribunal is that the assessee had received the aforesaid amount for transferring his leasehold interest and the monthly tenancy to the Associated Batteries with the consent of the landlords. This finding has not been challenged by the assessee by raising an appropriate question and, therefore, it is binding on the assessee and this court as well....