Amardeep Singh, Kolkata V. DCIT, CC - VI, Kolkata, Kolkata

CO 63/KOL/2011

• Counselvise Citation: [2012] 122 COUNSELVISE.COM (IT) 7033 (ITAT-KOLKATA)
• Duration Of Justice: 3 month(s) 11 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 29-02-2012
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 18-11-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Charitable institution; Cost of acquisition; Capital receipt; Surrender of tenancy right
• Section: 50C; 54F; 54

Judgement Text

CONO. 63 /KOL/20 11 AND I.T.A. NO.: 1460 / KOL. / 2011 ASSESSMENT YEAR : 2008 - 09 PAGE 1 OF 7 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA B BENCH, KOLKATA BEFORE SHRI PRAMOD KUMAR (ACCOUNTANT MEMBER) , AND SHRI MAHAVIR SINGH (JUDICIAL MEMBER) I.T.A. NO.: 1460 / KOL. / 2011 ASSESSMENT YEAR: 2008 - 09 DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE VI, KOLKATA . .APPELLANT VS. AMARDEEP SINGH RESPONDENT 18D, EVEREST, 46 C, J L NEHRU ROAD, KOLKATA 700 071 [ PAN : AJVP S 7664J ] C.O. NO. 6 3 /KOL/ 2011 ARISING OUT OF I.T.A. NO.: 14 60 / KOL. / 2011 ASSESSMENT YEAR: 2008 - 09 AMARDEE P SINGH .CROSS OBJECTOR 18D, EVEREST,46 C, J L NEHRU ROAD, KOLKATA 700 071 [ PAN : AJVP S 7664J ] VS. DY. COMMISSIONER OF INCOME TAX CENTRAL CIRCLE VI, KOLKATA . RESPONDENT APPEARANCES BY: A P ROY , FOR THE ASSESSING OFFICER LK KANO ONGO , FOR THE ASSESSEE DATE OF INSTITUTING THE APPEAL : OCTOBER 31 ,2011 DATE OF CONCLUDING THE HEARING : FEBRUARY 27 , 2012 DATE OF PRONOUNCING THE ORDER : FEBRUARY 29 , 2012 O R D E R PER PRAMOD KUMAR: 1. BY WAY OF THIS APPEAL, THE APPELLANT ASSE SSING OFFICER HAS CHALLENGED CORRECTNESS OF LEARNED COMMISSIONER (APPEALS)S ORDER DATED CONO. 63 /KOL/20 11 AND I.T.A. NO.: 1460 / KOL. / 2011 ASSESSMENT YEAR : 2008 - 09 PAGE 2 OF 7 9 TH AUGUST 2011, IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3 ) OF THE INCOME TAX ACT, 1961 ( HEREINAFTER REFERRED TO AS THE ACT), ON THE FOLLOWING GROUND: 1. THA T , ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) HAS ERRED IN DELETING ADDITION OF RS 46,24,350 ON ACCOUNT OF LONG TERM CAPITAL GAIN. 2. THAT, IN DOING SO, LEARNED CIT(A) ERRED IN HOLDING THAT SECTION 50C HAS NO APPLICATION ON TRAN SFER OF LEASEHOLD RIGHT IN BU ILDING. 2 . IN THE RELATED CROSS OBJECTION FILED BY THE ASSESSEE, FOLLOWING GRIEVANCE HAS BEEN RAISED: FOR THAT THE LEARNED CIT(A) IS NOT JUSTIFIED IN NOT CONSIDERING THE ALTERNATIVE GROUND THAT SECTION 50 C IS NOT APPLICABLE WHEN FULL VALUE OF THE CONSIDERATION IS INVESTED UNDER SECTION 54F AS FAR AS MEANING OF FULL VALUE OF CONSIDERATION UNDER SECTION 54F IS CONCERNED. 3. THE GRIEVANCES, WHICH HAVE BEEN RAISED IN THE APPEAL AND THE CROSS OBJECTIONS, ARE INTERCONNECTED AND CENTRE AROUND TREATMENT OF CAPITAL GAINS ON SALE OF A PROPERTY IN WHICH THE ASSESSEE HAD TENANCY RIGHTS. WE WILL, THEREFORE, TAKE UP ALL THE GRIEVANCES TOGETHER. 4. LEARNED REPRESENTATIVES SUBMIT THAT WHATEVER IS DECIDED IN THE CASE OF CO LESSEE TEJINDER SINGH, WHICH WAS HEARD ALONGWITH THIS SET OF APPEAL AND CROSS OBJECTION, WILL APPLY MUTATIS MUTANDIS HERE AS WELL. VIDE OUR ORDER OF EVEN DATE, WE HAVE DISMISSED ASSESSING OFFICERS APPEAL IN THE SAID CASE AS ALSO THE CROSS OBJECTION FILED BY THE ASSESSEE . WHILE DOING SO, WE HAVE OBSERVED AS FOLLOWS: 4. THE MATERIAL FACTS ARE NOT IN DISPUTE. THE ASSESSEE , ALONGWITH ONE AMARDEEP SINGH, HAD ACQUIRED, VIDE REGISTERED LEASE DEEDS DATED 19 TH NOVEMBER 1992 WITH SHREE KHUBCHAND SETHIA CHARITABLE TRUST ( KSCT , IN SHORT) , LEASE HOLD RIGHTS FOR 99 CONO. 63 /KOL/20 11 AND I.T.A. NO.: 1460 / KOL. / 2011 ASSESSMENT YEAR : 2008 - 09 PAGE 3 OF 7 YEARS IN A HOUS E PROPERTY SITUATED AT 5/1, RIP ON STREET, KOLKATA . THIS PROPERTY WAS COLLECTIVELY PURCHASED BY THREE ENTITIES, NAMELY SUGAM BUILDERS PVT LTD, NEELANCHAL SALES AND SUPPLIERS PVT LTD AND PLEASANT NIRYAT PVT L TD (COLLECTIVELY REFERRED TO AS PURCHASERS , IN SHORT) , FROM THE OWNER, I.E. KHUBCHAND SETHIA CHARITABLE TRUST, VIDE REGISTERED DEED DATED 20 TH DAY OF JULY 2007. THIS REGISTERED SALES DEED WAS A TRIPARTITE AGREEMENT BETWEEN THE OWNER, I.E. KSTC, THE LES SEES, I.E. THE ASSESSEE AND AMARDEEP SINGH, AND THE PURCHASERS. UNDER THE SAID AGREEMENT, WHILE OWNER TRANSFERRED INTER ALIA ALL ITS RIGHTS, TITLE AND INTEREST, OWNERSHIP AND REVERSIONARY RIGHTS IN THE SAID PROPERTY ETC FOR A CONSIDERATION OF RS 1,00,00, 000 , THE LESSEES GAVE UP ALL ITS RIGHTS AND INTERESTS IN THE SAID PROPERTY AND PROCEEDED TO, INTER ALIA, GRANT, CONVEY, TRANSFER AND ASSIGN THEIR LEASEHOLD RIGHTS, TITLE AND INTEREST IN THE SAID PREMISES, FOR A CONSIDERATION OF RS 3,19,00,000. THE TOTAL CONSIDERATION OF RS 3,19,00,000 PAID BY THE PURCHASERS FOR THE SAID PREMISES WAS THUS DIVIDED AS FOLLOWS: - (I) RS 1,00,00,000 FOR THE OWNER OF THE PREMISES I.E. KSCT; (II) RS 1,59,50,000 FOR TEJINDER SINGH, I.E. THE ASSESSEE BEFORE US IN THIS APPEAL; AND (III) RS 1,59,50,000 FOR AMARDEEP SINGH, I.E. CO LESSEE. 5. IN THE COURSE OF ASSESSMENT PROCEEDINGS, HOWEVER, THE ASSESSING OFFICER NOTED THAT THE STAMP DUTY VALUATION OF THE PROPERTY, WHICH WAS SOLD BY KSCT, WAS RS 5,59,57,375, WHEREAS THE STATED SALES CONSIDERATION OF THE PROPERTY WAS ONLY RS 4,19,00,000. HE WAS OF THE VIEW THAT, IN TERMS OF THE PROVISIONS OF SECTION 50 C, THE SALES CONSIDERATION, FOR THE PURPOSE OF COMPUTING THE CAPITAL GAINS, IS TO BE TAKEN AT THE STAMP DUTY VALUATION ADOPTED BY THE STAMP VALUATION AUTHORITY. HE THUS ADOPTED THE AMOUNT OF RS 5,59,57,375 AS SALES CONSIDERATION, AND PROCEEDED TO NOTIONALLY DIVIDE THE SAID AMOUNT AMONGST THE OWNER AND THE LESSEES IN THE SAME RATIO IN WHICH THE ACTUAL CONSIDERATION WAS DIVIDED. ACCORDING LY, AS AGAINST THE AMOUNT OF RS 1,59,50,000 ACTUALLY RECEIVED BY THE ASSESSEE, HE INCLUDED THE AMOUNT OF RS 2,12,47,375 IN COMPUTATION OF CAPITAL GAINS IN THE HANDS OF THE ASSESSEE. HE THEN PROCEEDED TO COMPUTE COST OF ACQUISITION AS THE LEASE RENTALS PAI D BY THE ASSESSEE OVER THE YEARS, AND AFTER INDEXING THE SAME, COMPUTED THE COST OF ACQUISITION AT RS 28,79,698. ON THIS BASIS, LONG TERM CAPITAL GAIN WAS COMPUTED AT RS 1,84,17,692. THE ASSESSING OFFICER THEN NOTED THAT SINCE WHILE THE GROSS SALES CONSI DERATION UNDER SECTION 50 C IN THE HANDS OF THE ASSESSEE IS RS 2,12,97,390, THE ASSESSEE HAD MADE AN INVESTMENT OF RS 1,96,03,685 IN QUALIFYING INVESTMENTS UNDER SECTION 54 F, AND, ACCORDINGLY, ASSESSEE IS ENTITLED TO 54F DEDUCTION ONLY TO THE PROPORTIONA TE EXTENT. THE DEDUCTION UNDER SECTION 54 F WAS THUS COMPUTED AT RS 1,69,53,000, AND THE BALANCE CAPITAL GAIN OF RS 14,64,692 WAS BROUGHT TO TAX IN THE HANDS OF THE ASSESSEE. WHILE DOING SO, AND ALMOST AS A POSTSCRIPT TO THE ASSESSMENT ORDER, THE ASSESSIN G OFFICER ALSO NOTED AS FOLLOWS: THE AUTHORISED REPRESENTATIVE OF THE ASSESSEE ARGUED THAT NO CAPITAL GAIN IS CHARGEABLE ON ACCOUNT OF SALE OF LEASEHOLD PROPERTY AT 5/1 RIPON STREET KOLKATA BECAUSE THE ASSESSEE HAD NO ABSOLUTE RIGHT TO THE SELL THE PROPE RTY. THE ASSESSEE IS SIMPLY A LESSEE OF THE SAID PROPERTY AND HE HAS ONLY THE RIGHT TO TRANSFER THE SAID LEASE RIGHT OF THE PROPERTY. THE CONTENTION OF THE ASSESSEE IS NOT ACCEPTABLE. CONSIDERATION IS PAID ON SALE OF THE PROPERTY FOR GIVING UP RIGHT OF THE CONO. 63 /KOL/20 11 AND I.T.A. NO.: 1460 / KOL. / 2011 ASSESSMENT YEAR : 2008 - 09 PAGE 4 OF 7 OWNER OF THE PROPERTY. IN THE CASE OF LEASEHOLD PROPERTY, THE RIGHT OF OWNER IS DIVIDED BETWEEN LESSOR AND LESSEE. THAT DOES NOT GIVE EITHER TO THE LESSEE OR THE LESSER IMMUNITY FOR NOT BEING CHARGED UNDER SECTION 45 OF THE ACT. 6. AGGRIEVED BY THE STAN D SO TAKEN BY THE ASSESSING OFFICER AND BY AN AMOUNT OF RS 14,64,692 BEING BROUGHT TO TAX IN THE HANDS OF THE ASSESSEE AS CAPITAL GAIN, ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A). LEARNED CIT(A) HELD THAT THE ASSESSEE WAS A TENANT IN THE PROPE RTY SOLD BY THE OWNER AND, THEREFORE, SO FAR AS THE ASSESSEE IS CONCERNED, THE RECEIPT IS IN THE NATURE OF RECEIPT ON SURRENDERING TENANCY RIGHTS. HE WAS FURTHER OF THE VIEW THAT THE PROVISIONS OF SECTION 50 C APPLY ONLY IN RESPECT OF LAND, BUILDING OR LAND AND BUILDING. RELYING UPON VARIOUS DECISIONS OF THIS TRIBUNAL, HE WAS HIS VIEW THAT THE PROVISIONS OF SECTION 50 C CANNOT BE PRESSED INTO SERVICE IN A CASE IN WHICH THE ASSESSEE HAS RECEIVED THE AMOUNT ON SURRENDER OF TENANCY RIGHTS. HE, THEREFORE , HELD THAT SECTION 50 C HAS NO APPLICATION TO THE FACTS OF THE CASE UNDER CONSIDERATION AND THE CAPITAL GAINS WILL HAVE TO BE RECOMPUTED ON THE BASIS OF ACTUAL CONSIDERATION AND NOT THE STAMP DUTY VALUE. AS REGARDS THE ALTERNATE PLEA THAT FULL CONSIDERA TION ON SALE OF CAPITAL ASSET HAS BEEN INVESTED IN QUALIFYING INVESTMENTS UNDER SECTION 54F, LEARNED CIT(A) DECLINED TO DEAL WITH THE SAME AND OBSERVED THAT SINCE THE GROUND NO. 1 HAS BEEN ALLOWED AND IT HAS BEEN HELD THAT THE AO WAS NOT CORRECT IN APPLYI NG THE DEEMING PROVISIONS OF SECTION 50 C, THE ALTERNATIVE ADDITIONAL GROUND TAKEN BY THE APPELLANT THAT THE DEEMING FICTION UNDER SECTION 50 C WILL NOT BE APPLICABLE TO SECTION 54 F AS FAR AS THE MEANING OF FULL VALUE OF CONSIDERATION IS CONCERNED, BECOM ES ACADEMIC AND, IS, THEREFORE, NOT CONSIDERED. NONE OF THE PARTIES IS SATISFIED BY THE STAND SO TAKEN BY THE CIT(A). THE ASSESSING OFFICER IS AGGRIEVED THAT THE CIT(A) OUGHT TO HAVE UPHELD APPLICABILITY OF SECTION 50 C IN THIS FACT SITUATION AS WELL, THE ASSESSEE IS AGGRIEVED THAT THE CIT(A) OUGHT TO HAVE ADJUDICATED ON THE ALTERNATIVE GROUND OF APPEAL AS WELL. THATS HOW THE ASSESSING OFFICER IS IN APPEAL BEFORE US, AND THE ASSESSEE HAS ALSO FILED A CROSS OBJECTION BEFORE US. 7. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED APPLICABLE LEGAL POSITION IN THE LIGHT OF THE FACTS OF THE CASE. 8. A PLAIN LOOK AT THE UNDISPUTED FACTS OF THIS CASE CLEARLY SHOWS THAT THE ASSESSEE WAS A LESSEE IN THE PROPERTY WHICH WAS SOLD BY THE KSCT; THERE IS NO DISPUTE ON THIS ASPECT OF THE MATTER. YET, THE ASSESSING OFFICER HAS TREATED THE ASSESSEE A SELLER OF PROPERTY APPARENTLY BECAUSE THE ASSESSEE WAS A PARTY TO THE SALE DEED, AND BECAUSE, ACCORDING TO THE ASSESSING OFFICER, CON SIDERATION IS PAID ON SALE OF THE PROPERTY FOR GIVING UP RIGHT OF THE OWNER OF THE PROPERTY AND THAT IN THE CASE OF LEASEHOLD PROPERTY, THE RIGHT OF OWNER IS DIVIDED BETWEEN LESSOR AND LESSEE. WE ARE UNABLE TO SHARE THIS LINE OF REASONING. IT IS NO T N ECESSARY THAT CONSIDERATION PAID BY THE BUYER OF A PROPERTY, AT THE TIME OF BUYING THE PROPERTY, MUST ONLY RELATE TO OWNERSHIP RIGHTS. IN THE CASE OF TENANTED PROPERTY, AS IS THE CASE BEFORE US, WHILE THE BUYER OF PROPERTY PAYS THE OWNER OF PROPERTY FOR OW NERSHIP RIGHTS, HE MAY ALSO CONO. 63 /KOL/20 11 AND I.T.A. NO.: 1460 / KOL. / 2011 ASSESSMENT YEAR : 2008 - 09 PAGE 5 OF 7 HAVE TO PAY, WHEN HE WANTS TO HAVE POSSESSION OF THE PROPERTY AND TO REMOVE THE FETTERS OF TENANCY RIGHTS ON THE PROPERTY SO PURCHASED, THE TENANTS TOWARDS THEIR SURRENDERING THE TENANCY RIGHTS. MERELY BECAUSE HE PAYS THE TENA NTS, FOR THEIR SURRENDERING THE TENANCY RIGHTS, AT THE TIME OF PURCHASE OF PROPERTY, WILL NOT ALTER THE CHARACTER OF RECEIPT IN THE HANDS OF THE TENANT RECEIVING SUCH PAYMENT. WHAT IS PAID FOR THE TENANCY RIGHTS CANNOT, MERELY BECAUSE OF THE TIM ING OF THE PAYMENT, CANNOT BE TREATED AS RECEIPT FOR OWNERSHIP RIGHTS IN THE HANDS OF THE ASSESSEE. THIS DISTINCTION BETWEEN THE RECEIPT FOR OWNERSHIP RIGHTS IN RESPECT OF A PROPERTY AND RECEIPT FOR TENANCY RIGHTS IN RESPECT OF A PROPERTY , EVEN THOUGH BOTH THESE RECE IPTS ARE CAPITAL RECEIPTS LEADING TO TAXABLE CAPITAL GAINS , IS VERY IMPORTANT FOR TWO REASONS FIRST, THAT THE COST OF ACQUISITION FOR TENANCY RIGHTS, UNDER SECTION 55(2)(A), IS, UNLESS PURCHASED FROM A PREVIOUS OWNER WHICH IS ADMITTEDLY NOT THE CASE HE RE , TREATED AS NIL; AND, - SECOND, SINCE THE PROVISIONS OF SECTION 50 C CAN ONLY BE APPLIED IN RESPECT OF TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET, BEING LAND OR BUILDING OR BOTH, THE PROVISIONS OF SECTION 50 C WILL APPLY ON RECEIPT OF CONSIDERATIO N ON TRANSFER OF A PROPERTY, BEING LAND OR BUILDING OR BOTH, THESE PROVISIONS WILL NOT COME INTO PLAY IN A CASE WHERE ONLY TENANCY RIGHTS ARE TRANSFERRED OR SURRENDERED. IT IS, THEREFORE, IMPORTANT TO EXAMINE AS TO IN WHAT CAPACITY THE ASSESSEE RECEIVED THE PAYMENT. NO DOUBT THE ASSESSEE WAS A PARTY TO THE REGISTERED TRIPARTITE DEED DATED 20 TH JULY 2007 WHEREBY THE PROPERTY WAS SOLD BY THE KSCT, BUT, AS A PERUSAL OF THE SALE DEED UNAMBIGUOUSLY SHOWS, THE ASSESSEE HAS GIVEN UP ALL THE RIGHTS AN D INTERESTS IN THE SAID PROPERTY, WHICH HE HAD ACQUIRED BY THE VIRTUE OF LEASE AGREEMENTS WITH OWNER AND WHICH WERE, THEREFORE, IN THE NATURE OF LESSEES RIGHTS; THESE RIGHTS COULD NOT HAVE BEEN , BY ANY STRETCH OF LOGIC, COULD BE TREATED AS OWNERSHIP RIGHTS . IT HAS B EEN SPECIFICALLY STATED IN THE SALE DEED THAT THE LESSEE, WHICH INCLUDED THIS ASSESSEE BEFORE US, HAD PROCEEDED TO, INTER ALIA, GRANT, CONVEY, TRANSFER AND ASSIGN THEIR LEASEHOLD RIGHTS, TITLE AND INTEREST IN THE SAID PREMISES . THERE IS NOTHING ON THE RE CORD TO EVEN REMOTELY SUGGEST THAT THE ASSESSEE WAS OWNER OF THE PROPERTY IN QUESTION. THE MONIES RECEIVED BY THE ASSESSEE, UNDER THE SAID AGREEMENT, WERE THUS CLEARLY IN THE NATURE OF RECEIPTS FOR TRANSFER OF TENANCY RIGHTS, AND, ACCORDINGLY, AS THE LEARN ED CIT(A) RIGHTLY HOLDS, SECTION 50 C COULD NOT HAVE BEEN INVOKED ON THE FACTS OF THIS CASE. REVENUES CONTENTION THAT THE PROVISIONS OF SECTION 50 C ALSO APPLY TO THE TRANSFER OF LEASEHOLD RIGHTS IS DEVOID OF LEGALLY SUSTAINABLE MERITS AND IS NOT SUPPORTE D BY THE PLAIN WORDS OF THE STATUTE. SECTION 50 C CAN COME INTO PLAY ONLY IN A SITUATION WHERE THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF THE TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET, BEING LAND OR BUILDING OR BOTH, (EMPHASIS SUPPLIED BY US B Y UNDERLINING) IS LESS THAN THE VALUE ADOPTED OR ASSESSED OR ASSESSABLE BY ANY AUTHORITY OF A STATE GOVERNMENT FOR THE PURPOSE OF PAYMENT OF STAMP DUTY IN RESPECT OF SUCH TRANSFER. CLEARLY, THEREFORE, IT IS SINE QUA NON FOR APPLICATION OF SECTION 50 C THAT THE TRANSFER MUST BE OF A CAPITAL ASSET, BEING LAND OR BUILDING OR BOTH , BUT THEN A LEASEHOLD RIGHT IN SUCH A CAPITAL ASSET CANNOT BE EQUATED WITH THE CAPITAL ASSET PER SE. WE ARE, THEREFORE, UNABLE TO SEE ANY MERITS IN REVENUES CONTENTION THAT E VEN WHEN A LEASEHOLD RIGHT IN LAND OR BUILDING OR BOTH IS TRANSFERRED, THE PROVISIONS OF SECTION 50C CAN BE INVOKED. WE, THEREFORE, APPROVE THE CONCLUSION ARRIVED AT BY THE CIT(A) ON THIS ASPECT OF THE MATTER. CONO. 63 /KOL/20 11 AND I.T.A. NO.: 1460 / KOL. / 2011 ASSESSMENT YEAR : 2008 - 09 PAGE 6 OF 7 9. HAVING HELD SO, WE MAY ALSO POINT OUT T HAT THE ASSESSING OFFICER HAS ADOPTED COST OF ACQUISITION OF THE ASSET AS LEASE RENT PAID FOR THE SAME AND EVEN GRANTED INDEXATION BENEFITS THEREON. IN THE IMPUGNED ORDER, CIT(A) HAS DIRECTED THAT CONSIDERATION FOR COMPUTATION OF CAPITAL GAINS ON SURRENDE RING THE TENANCY RIGHTS IS TO BE TAKEN AT ACTUALS, AND NOT AS RECOMPUTED BY THE ASSESSING OFFICER BY TAKING STAMP VALUATION AS THE SALE CONSIDERATION FOR THE PROPERTY, BUT THEN WHAT THE CIT(A) HAS APPARENTLY MISSED OUT IS THE FACT THAT IN THE CASE OF SURRE NDER OF TENANCY RIGHTS, THE COST OF ACQUISITION OF THE TENANCY RIGHTS, IN VIEW OF THE SPECIFIC PROVISIONS OF SECTION 55(2)(A), SHOULD HAVE BEEN TAKEN AS NIL. THIS ASPECT OF THE MATTER IS SOMEWHAT ACADEMIC AND TAX NEUTRAL BECAUSE ADMITTEDLY QUALIFYING IN VESTMENT UNDER SECTION 54F IS MORE THAN THE CONSIDERATION FOR SURRENDER OF THESE TENANCY RIGHTS. THE ASSESSING OFFICER HAS GIVEN A CATEGORICAL FINDING ABOUT THE QUANTUM OF QUALIFYING INVESTMENT OF RS 1,96,03,685. IN VIEW OF THESE DISCUSSIONS, WE ARE OF TH E CONSIDERED VIEW THAT THE ASSESSEE DID NOT HAVE ANY TAXABLE CAPITAL GAIN IN RESPECT OF RECEIPT OF RS 1, 5 9,50,000 ON ACCOUNT OF SURRENDER OF TENANCY RIGHTS. THE RELIEF GRANTED BY THE CIT(A), THEREFORE, DESERVES TO BE UPHELD. 10. LEARNED COUNSEL FOR THE AS SESSEE SUBMITS THAT IN THE EVENT OF OUR UPHOLDING THE RELIEF GRANTED BY THE CIT(A), THE GRIEVANCE RAISED IN THE ASSESSEES CROSS OBJECTION WILL BE WHOLLY ACADEMIC AND WOULD NOT NEED ANY ADJUDICATION ON MERITS. HE SUBMITS THAT IN SUCH A SITUATION, HE WOULD NOT PRESS THE CROSS OBJECTION. WE HAVE UPHELD THE ORDER OF THE CIT(A), AND, THEREFORE, WE DISMISS THE CROSS OBJECTION AS NOT PRESSED. 11. IN THE RESULT, THE APPEAL AS ALSO THE CROSS OBJECTION ARE DISMISSED 5. WE SEE NO REASONS TO TAKE ANY OTHER VIEW OF THE MATTER THAN THE VIEW SO TAKEN BY US IN THE CO LESSEES CASE. WE HAVE ALSO NOTED THAT ALL THE MATERIAL FACTS OF THE CASE ARE THE SAME, EXCEPT FOR THE QUANTUM OF QUALIFYING INVESTMENTS UNDER SECTION 54F. IN THE PRESENT CASE, QUALIFYING INVESTMENT, AS NOTED BY THE ASSESSING OFFICER HIMSELF, IS RS 1,59,50,000. SINCE THIS AMOUNT IS THE SAME AS THE GROSS CONSIDERATION RECEIVED BY THE ASSESSEE FOR SURRENDERING TENANCY RIGHTS, ENTIRE CAPITAL GAINS ON SURRENDER OF TENANCY RIGHTS WILL BE OUTSIDE THE AMBIT OF TAXABLE CAPITAL GAINS. 6. FOR THE REASONS SET OUT ABOVE, WE APPROVE THE CONCLUSIONS ARRIVED AT BY THE CIT(A) AND DECLINE TO INTERFERE IN THE MATTER. GRIEVANCE RAISED BY THE ASSESSEE IN THE CROSS OBJECTION, FOR THE SAME REASONS AS IN THE CASE OF TEJINDER S INGH (SUPRA), ARE RENDERED ACADEMIC AND DONOT CALL FOR ANY CONO. 63 /KOL/20 11 AND I.T.A. NO.: 1460 / KOL. / 2011 ASSESSMENT YEAR : 2008 - 09 PAGE 7 OF 7 ADJUDICATION ON MERITS. THE CROSS OBJECTIONS ARE DISMISSED AS NOT PRESSED BY THE ASSESSEE. 7. IN THE RESULT, THE APPEAL FILED BY THE ASSESSING OFFICER AS ALSO THE CROSS OBJECTION FILED BY THE ASSE SSEE ARE DISMISSED. PRONOUNCED IN THE OPEN COURT TODAY ON 29 TH FEBRUARY, 2012. SD/XX SD/XX MAHAVIR SINGH PRAMOD KUMAR (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, THE 29 TH DAY OF FEBRUARY, 2012 COPIES TO : (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ETC ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES, KOLKATA