Oikos Apartments Pvt Ltd , Bangalore V. Income Tax Officer Ward-5(1)(2), Bangalore

ITA 1384/BANG/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 4798 (ITAT-BANGALORE)
• Duration Of Justice: 11 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2018
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 16-06-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: DR P V PRADEEP KUMAR
• Assessee Lawyers: K BALASUBR AMANIAN; HARSHA CHANDRA CAS
• Keywords: Capital asset

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, B ENGALURU BEFORE S HRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER I TA NO. 1 384/ BANG/2 0 1 7 (ASSESSMENT YEAR: 2012 - 13 ) M/S.OIKOS APARTMENTS PVT. LTD. # 132, EMBASSY WOODS, 6A, CUNNINGHAM ROAD, BENGALURU - 5600 52. PAN:AAAFO1562D VS. APPELLANT INCOME - TAX OFFICER, WARD 5(1)(2) , BENGALURU. RESPONDENT APPELLANT BY : S/ SHRI K.BALASUBRAMANIAN & HARSHA CHANDRA, CAS RESPONDENT BY : DR. P.V.PRADEEP KUMAR, AD DL.CIT(DR) DATE OF HEARING : 20 /03/2018 DATE OF PRONOUNCEMENT : 31 /05/2018 O R D E R PER I NTURI RAMA RAO, AM : THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AGAINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) - 5, BENGALURU [CIT(A)] DATED 31/03/2017 FOR THE ASSESSMENT YEAR 2012 - 13. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT T HE ASSESSEE IS A COMPANY INCORPORATED UNDER THE COMPANIES ACT 1956. IT IS ENGAGED IN THE BUSINESS OF REAL ESTATE. THE RETURN OF INCOME FOR THE ASS ESSMENT YEAR 2012 - 13 WAS FILED ON 12/12/2012 DISCLOSING NIL INCOME. AGAINST THE SAID RETURN OF INCOME, THE ASS ESSMENT WAS COMPLETED BY THE ASSESSING OFFICER ( AO ) AT TOTAL INCOME OF R S.1.5 CRORE VIDE ORDER DATED 16/03/2015. THE AO MADE ADDITION ON ACCOUNT OF AMOUNT RECEIVED FROM M/S. SKYLINE C ONSTRUCTION & HOUSING PVT. LTD., O N ENTERING INTO AGREEMENT ON 6/6/I2006 FOR GRANTING INGRESS AND EGRESS OF PROPERTY OWNED BY THE ASSESSE E. IN TERMS OF SAID AGREEMENT, THE ASSESSEE RECEIVED CONSIDERATION OF RS. 3.5 CR ORES OUT OF WHICH RS. 1.4 CRORES WAS RECEIVED ITA NO . 1384 /BANG/20 17 PAGE 2 OF 11 DURING THE FINANCIAL YEAR 2011 - 12 AND RS. 2 CRORES DUR ING THE FINANCIAL YEAR 2013 - 14. IT IS THE CONTENTION OF THE ASSESSEE THA T SINCE ENTIRE CONSIDERATION HAD NOT BEEN RECEIVED AND AN AMOUNT OF RS. 1.5 CRORES RECE IVED DURING THIS YEAR WAS SHOWN UNDER CURRENT LIABILITY AND HENCE , NOT LIABLE TO TAX . THE SAID CONTENTION OF THE ASSESSEE HA D BEEN REJECTED BY THE AO. IT WAS FURTHER CONTENDED THAT GRANTING OF EASEMENT RIGHTS DOES NOT RES ULT IN TRANSFER OF ANY CAPITAL ASSE T. THE SAID CONTENTION OF THE ASSESSEE ALSO HA D BEEN REJECTED BY THE AO AND BROUGHT TO TAX RS . 1.5 CRORES DURING THE YEAR UNDER CONSIDERATION. 3. B EING AGGRIEVED , AN APPEAL WAS PREFERRED BEFORE THE LD. CIT (A). T HE LD. CIT (A), AFTER CONSIDERING THE PROV ISIONS OF SECTION 2 ( 47 ) OF THE INCOME TAX ACT 1961 [ THE ACT FOR SHORT] AND THE DEFINITION OF CAPITAL ASSET AS PROVIDED UNDER SECTION 2 OF THE ACT HELD THAT THE EASEMENT CONSTITUTES CAPITAL ASSET. THE GRANT OF LICENCE OF EASEMENT ALSO RESULTS IN TRANSFE R AS ENVISAGED UNDER SECTION 2(47) OF THE ACT AND ALSO HELD THAT HAVING REGARD TO THE SETTLED POSITION PROPOSITION OF LAW THAT CAPITAL GAINS ARE TAXABLE ON ACCRUAL IRRESPECTIVE OF ACTUAL RECEIPT OF THE CONSIDERATION , AFTER GIVING OPPORTUNITY TO THE ASSESSE E, THE LD.CIT(A) ENHANCED THE ASSESSMENT BY A SUM OF RS.2 CORES WHICH WAS RECEIVED IN THE FINANCIAL YEAR 2014 - 15 . ACCORDINGLY , THE LD. CIT(A) DIRECTED T HE AO TO TAX ENTIRE SUM OF RS. 3.5 CRORES AS CAPITAL GAINS DURING THE YEAR UNDER CONSIDERATION . 4. B EING AGGRIEVED, THE ASSESSEE IS BEFORE US IN THE PRESENT APPEAL RAISING THE FOLLOWING GROUNDS OF APPEAL: ITA NO . 1384 /BANG/20 17 PAGE 3 OF 11 5. WE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE IN THE APPEAL IS DEALT WITH BY THE LD.CIT(A) AS UNDER: ITA NO . 1384 /BANG/20 17 PAGE 4 OF 11 ITA NO . 1384 /BANG/20 17 PAGE 5 OF 11 ITA NO . 1384 /BANG/20 17 PAGE 6 OF 11 ITA NO . 1384 /BANG/20 17 PAGE 7 OF 11 ITA NO . 1384 /BANG/20 17 PAGE 8 OF 11 ITA NO . 1384 /BANG/20 17 PAGE 9 OF 11 ITA NO . 1384 /BANG/20 17 PAGE 10 OF 11 ITA NO . 1384 /BANG/20 17 PAGE 11 OF 11 THE ORDER OF THE LD.CIT(A) IS WELL - REASONED AND IN CONSONANCE WITH THE SETTLED PROPOSITION OF LAW . W E DON'T FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) . 6. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS DIS MISSED . ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST MAY, 2018 SD/ - SD/ - (SUNIL KUMAR YADAV) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER PLACE : BENGALURU. D A T E D : 31/05/2018 SRINIVASULU, SPS COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A) 4 CIT 5 DR, ITAT, BANGALORE. 6 GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY INCOME - TAX APP ELLATE TRIBUNAL BANGALORE