2015 (5) TMI 1254

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....Flat No. 21, Hope apartments, Sector J 5, Gurgaon under the head "Other Sources" thereby disallowing the claim of standard deduction u/s 24(b) of the Income Tax Act, 1961 (herein after the Act) to the extent of 30% of rental income and municipal taxes paid in relation to such property during the relevant financial year. 3. Without prejudice to ground no. 2 above, the Ld. AO has erred in not allowing the deduction of municipal taxes paid in respect of property i.e. Flat No. 2 J, Hope apartments, Sector 15, Gurgaon, u/s 57 of the Income Tax Act, 1961 while taxing the Income from such property as chargeable under the head "Other Sources". 4. On both the facts and circumstances of the case, the Ld. A.O. has erred both on the facts and in law, in disallowing car insurance expenses paid in the relevant financial year but to the extent pertaining to next year ignoring the fact that the appellant was neither maintaining regular books of accounts nor was she required to do so, accordingly her income under the head "Other Sources" was chargeable to tax on cash basis and not accrual basis. 5. On the facts and circumstances of the case, the Ld CIT (A) has erred In di....

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....ugned order as under:- "Advantages of Registration 10. In the earlier order dated 15.5.2009, the objects and benefits of registration were explained and we extract them for ready reference : & quot; The Registration Act, 1908, was enacted with the intention of providing orderliness, discipline and public notice in regard to transactions relating to immovable property and protection from fraud and forgery of documents of transfer. This is achieved by requiring compulsory registration of certain types of documents and providing for consequences of non-registration. Section 17 of the Registration Act clearly provides that any document (other than testamentary instruments) which purports or operates to create, declare, assign, limit or extinguish whether in present or in future &quot, any right, title or interest & quot; whether vested or contingent of the value of Rs. 100 and upwards to or in immovable property. Section 49 of the said Act provides that no document required by Section 17 to be registered shall, affect any immovable property comprised therein or received as evidence of any transaction affected such property, unless it has been registe....

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.... property but also to transfer of leasehold property. A lease can be validly transferred only under a registered Assignment of Lease. It is time that an end is put to the pernicious practice of SA/GPA/WILL transactions known as GPA sales. (emphasis added) 17. It has been submitted that making declaration that GPA sales and SA/GPA/WILL transfers are not legally valid modes of transfer is likely to create hardship to a large number of persons who have entered into such transactions and they should be given sufficient time to regularize the transactions by obtaining deeds of conveyance. It is also submitted that this decision should be made applicable prospectively to avoid hardship. 18. We have merely drawn attention to and reiterated the well-settled legal position that SA/GPA/WILL transactions are not 'transfers' or 'sales' and that such transactions cannot be treated as completed transfers or conveyances. They can continue to be treated as existing agreement of sale. Nothing prevents affected parties from getting registered Deeds of Conveyance to complete their title. The said 'SA/GPA/WILL transactions' may also be used to obtain specific ....

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....ely covered by the decision of Hon'ble Delhi High Court in the case of S. Kartar Singh vis ClT, 73 ITR 438 (Del). Here, also the transferor has transferred the income and not the asset. Thus, in such situation, section 60 of the Income Tax Act gets attracted because there is no valid transfer of asset though the transfer of income derived therefrom is there. 5.3 As regards the case laws; Poddar Cement and Kamla Sondhi (supra) relied upon by the appellant, it may be mentioned that* these case laws are distinguishable on facts and do not apply to the appellant's case. In these cases, the transfers/transactions were amongst unrelated parties and there is no doubt on payment of purchase price and transfer in accordance with the section 53A of the TPA, whereas there are no such facts in the present case. The question is one of applicability of the principles to the facts in a given case. It has been a well-settled view that the ratio of any decision must be understood in the background of that case. What is of essence in a decision is its ratio and not every observation found therein nor what legally follows from the various observations made in it. It is not a profitab....

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....e facts and in the circumstances of the case, the Tribunal was correct in law in holding that rental income from flat in a multistoreyed building is assessable in the hands of the assessed under the head 'Income from house property even though the assessed had not acquired legal title to the ownership of the said property through a registered sale deed in her favor?" 2. In view of the Supreme Court decision in the case of CIT v. Podar Cement (P) Ltd. (1997) 226 ITR 625 (SC), the answer is required to be given in favor of the assessed and against the revenue. The Apex Court in the said decision has held as under: "We are conscious of the settled position that under the common law, owner means a person who has got valid title legally conveyed to him after complying with the requirements of law such as the Transfer of Property Act, Registration Act, etc. But, in the context of section 22 of the Income Tax Act, having regard to the ground realties and further having regard to the object of the Income Tax Act, namely, to tax the income, we are of the view, owner is a person who is entitled to receive income from the property in his own right." Accordingly,....