N.R. Krishna Murthy, Hyd, Hyderabad V. ITO, Ward-5(2), Hyd, Hyderabad

ITA 1424/HYD/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 6650 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2016
• Appeal Filed By: Assessee
• Bench Allotted: B
• Next Hearing Date: 17-11-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 21-12-2015
• Court: TRIBUNAL
• Department Lawyers: JAGADISH BABU
• Keywords: Deduction for capital gain
• Section: 143(3); 54F; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH ES B , HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER I.T.A. NO. 1424 /H YD /201 5 ASSESSMENT YEAR: 20 0 9 - 1 0 N.R. KRISHNA MURTHY HYDERABAD [PAN: A A UP N7745H ] VS INCOME TAX OFFICER , WARD - 5 (2), HYDERABAD (APPELLANT) (RESPONDENT) FOR ASSESSEE : SHRI AMRIT KUMAR KOTA , AR FOR REVENUE : SHRI JAGADISH BABU , CIT - D R DATE OF HEARING : 2 2 - 0 3 - 201 6 DATE OF PRONOUNCEMENT : 07 - 0 4 - 201 6 O R D E R PER B. RAMAKOTAIAH, A.M. : TH IS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX ( APPEALS ) - 4 , HYDERABAD DATED 13 - 1 0 - 2015. ASSESSEE HAS RAISED THE FOLLOWING GROUND, WHICH IS MATERIAL FOR CONSIDERATION: A. THE COMMISSIONER OF INCOME TAX (APPEALS) - IV ERRED IN CONFIRMING THE SALE CONSIDERATION RECEIVED AS INCOME FROM OTHER SOURCES INSTEAD OF INCOME FROM LONG TERM CAPITAL GAINS. 2. BRIEFLY STATED, ASSESSEE IS AN INDIVIDUAL AND HAS OFFERED CAPITAL GAI NS CLAIMING DEDUCTION U/S. 54EC & 54F OF THE INCOME TAX ACT [ACT]. THE ASSESSMENT U/S. 143 (3) WAS COMPLETED ON I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 2 - : 29 - 12 - 2011 BY ACCEPTING THE RE TURNED INCOME OF RS. 2,57,230/ - . LD. CIT(A) - 4, HYDERABAD NOTICED THAT THE SAID ORDER U/S. 143(3) IS ER RONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE AND ACCORDINGLY INITIATED THE PROCEEDINGS U/S. 263 AND SET ASIDE THE ASSESSMENT OF 04 - 02 - 2014. THE PRESENT APPEAL IS O N THE CONSEQUENTIAL PROCEEDINGS PASSED BY THE AO U/S. 143(3) R.W.S. 263. LD. CIT(A) CO NFIRMED THE ACTION OF THE AO IN TREATING THE CAPITAL GAINS OFFERED AS INCOME FROM OTHER SOURCES. 3. BRIEFLY STATED, AS SUBMITTED BY ASSESSEE BEFORE THE LD. CIT(A), ASSESSEE HAS ENTERED INTO AN AGREEMENT FOR PURCHASE OF PROPERTY FROM SMT. KOTHA JANAMMA IN THE YEAR 1994 FOR PURCHASE OF 2.07 GUNTAS SITUATED AS PART OF SURVEY NO. 215 OF KONDAPUR VILLAGE, SERILINGAMPALLY. HOWEVER, THIS PROPERTY WAS REGISTERED BY SMT. K. JANAMMA IN THE NAMES OF SHRI N. CHANDRA SEKHAR RAO, R . MADHUS UDHAN AND N.R. MURALI KRISHNA VIDE THE REGISTERED DEED DT. 27 - 03 - 1995. SUBSEQUENTLY, THOSE THREE PARTIES ALONG WITH ASSESSEE HAVE ENTERED INTO AN AGREEMENT OF DEVELOPMENT WITH M/S. TEAM ONE BUILDERS, A PARTNERSHIP FIRM AND ACCORDINGLY RECEIVED AN AMOUNT OF RS. 1,60,00,000/ - BY WAY OF CHEQUE IE RS 40 LAKHS EACH AND CONSTRUCTED AREA TO AN EXTENT OF RS. 6050 SQ. FT., FOR EACH ONE OF THEM. THIS IS VALUED AT RS. 60 LAKHS FOR THE PURPOSE OF CAPITAL GAIN. THUS, ON THE TRANSFER OF PROPERTY, ASSESSEE HAS RECEIVED RS. 1 CRORE AND OFFERED CAPITAL GAINS OF RS. 92,40,479/ - AND CLAIMED DEDUCTIONS U/S. 54EC TO AN EXTENT OF RS. 39,30,000/ - AND PROPORTIONATE CLAIM U/S. 54F TO AN EXTENT OF RS. 54,98,085/ - . THIS COMPUTATION WAS ACCEPTED BY AO IN THE ASSESSMENT U/S 143(3). L D. CIT IN THE ORDER U/S. 263 HAS NOTED THAT ASSESSEE DOES NOT HAVE OWNERSHIP ON THE PROPERTY AND ACCORDINGLY INVOKED THE I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 3 - : PROCEEDINGS U/S. 263 AND SET ASIDE THE ASSESSMENT WITH THE FOLLOWING OBSERVATIONS: 3.2 THUS, IT CAN BE SEEN FROM THE ABOVE THAT THE ASSESSEE IS NOT A OWNER OF THE PROPERTY UNDER CONSIDERATION BUT HE RECEIVED RS. 1,00,00,000/ - FROM M/S. TEAM ONE BUILDERS AS PER THE RECEIPT ISSUED BY THE ASSESSEE TO M/S. TEAM ONE BUILDERS, ALONG WITH HIS THREE BROTHERS, WHICH IS AVAILABLE ON RECORD. SI NCE THE ASSESSEE IS NOT THE OWNER OF THE PROPERTY AS PER THE SALE DEED, THE AMOUNT OF RS. 1,00,00,000/ - RECEIVED BY THE ASSESSEE CANNOT BE TERMED AS A SALE CONSIDERATION AND THEREFORE THE QUESTION OF COMPUTATION OF LONG TERM CAPITAL GAIN DOES NOT ARISE IN THIS CASE. THE CONTENTION THAT THE ASSESSEE HAS INTEREST/TITLE IN THE SAID PROPERTY BY VIRTUE OF SALE OF AGREEMENT DATED 4.7.1994 IS NOT LEGALLY TENABLE AS THE PROPERTY WAS SUBSEQUENTLY REGISTERED IN FAVOUR OF OTHERS AND THE AGREEMENT HAS CEASED TO EXIST. 4. THOUGH, IT IS AN UNDISPUTED FACT ON RECORD THAT THE ASSESSEE RECEIVED RS. 40 LAKHS AS PER HIS OWN ADMISSION, IS ENTITLED TO A CONSTRUCTED AREA OF WORTH OF RS. 60 LAKHS, THIS RECEIPT OF MONEY AND CONSTRUCTED AREAS DOES NOT PRE - SUPPOSE THAT ASSESSEE WAS HAVING INTEREST/TITLE OVER THE PROPERTY ALONG WITH HIS BROTHERS. THERE MAY BE UMPTEEN REASONS FOR PAYMENT OF MONEY AND FOR GIVING CONSTRUCTED AREA TO ASSESSEE BY THE DEVELOPER. BUT THE FACT REMAINS THAT THE ASSESSEE RECEIVED RS. 1 CRORE FROM THE DEVELOP ER THOUGH HE IS NOT OWNER OF THE PROPERTY. IN THE LIGHT OF THESE FACTS AND DOCUMENTARY EVIDENCE, THE AMOUNT RECEIVABLE BY THE ASSESSEE IS NOT ASSESSABLE AS CAPITAL GAIN AND NO DEDUCTION U/S. 54F & 54EC ARE NOT ALLOWABLE. UNDER THE FACTS AND CIRCUMSTANCES OF THE CASE, THE AMOUNT OF RS. 1 CRORE RECEIVED BY THE ASSESSEE HAS TO BE ASSESSED AS INCOME FROM OTHER SOURCES . THIS ORDER OF THE LD. CIT WA S NOT CONTESTED BY ASSESSEE AS THE MATTER WAS SET ASIDE TO THE FILE OF AO. IN THE CONSEQUENTIAL PROCEEDINGS, AO GAVE AN OPPORTUNITY AND AFTER CONSIDERING ASSESSEES SUBMISSIONS WAS OF THE VIEW THAT ASSESSEE BEING NOT A OWNER OF THE PROPERTY, CANNOT CLAIM CAPITAL GAINS AND FURTHER EXEMPTIONS THEREON AND TREATED THE AMOUNT RECEIVED AS INCOME FROM OTHER SOURCES. THUS, ENTIRE RS. 1 CRORE STATED TO HAVE BEEN RECEIVED BY ASSESSEE WAS BROUGHT TO TAX AS INCOME FROM OTHER SOURCES. I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 4 - : 4. IN THE APPEAL BEFORE THE LD. CIT(A), ASSESSEE SUBMITTED AS UNDER: 'THE ASSESSEE, MR. N.R . KRISHNA MURTHY S/O SRI LATE N.RAJAIAH, N. CHANDRASEKHAR RAO S/O SRI LATE N. RAJAIAH, SRI R. MADHUSUDAN S /P SRI LATE N. RAJAIAH, SRI N.R.MURALI KRISHNA S/O SRI LATE N. RAJAIAH ARE FOUR BROTHERS OWNERS OF THE PROPERT Y (ONLY A PROPERIV) OF 2.07 GUNTAS SITUATED AT FORMING PART OF SURVEY NO.21S OF KON DAPUR VILLAGE, SERILINGAMPALLY MANDAI, RR.DIST. THE SAID PROPERT Y WAS PURCHASED BY THEM FROM SMT. KOTHA JANAMMA IN THE YEAR 1994. AS PER THE ORAL AGREEMENT AND CONSENT AMONG FOUR OF THEM AN 'AGREEMENT OF SALE' WAS ENTERED IN THE NAME OF MR. N.R KRISHNA MUR THY S/O SRI LATE N. RAJAIAH ON 4TH DAY OF JULY 1994. AT T HE OUTSET WE WOULD LIKE TO CERTIF Y THE TITLE RIGHTS OF THE ASSESSEE ON THE PROPERT Y IN CONNECTION WITH THE DOUBT EXPRESSED BY HON'BLE CIT - IV. THAT THE ASSESSEE MR. N.RKRISHNA MURTHY S/O SRI LATE N. RAJAIAH, N. CHANDRASEKHAR RAO S/O SRI LATE N. RAJAIAH, SRI R MADHUSUDAN S / P SRI LATE N. RAJAIAH, SRI N.RMURALI KRISHNA S/O SRI LATE N. RAJAIAH ARE FOUR BROTHERS OWNERS OF THE PROPERTLJ(ONLY A PROPERTQ) OF 2.07 GUNTAS SITUATED AT FORMING PART OF SURVEY NO. 21S OF KONDAPUR VILLAGE, SERILINGAMPALLY MANDAI, R.R.DIST. THE SAID PROPERT Y WAS PUR CHASED BY THEM FROM SMT. KOTHA J ANAMMA IN THE YEAR 1994. AS PER THE ORAL AGREEMENT AND CONSENT AMONG FOUR OF THEM AN 'AGREEMENT OF SALE' WAS ENTERED IN THE NAME OF MR. N.R KRISHNA MURTHY S/O SRI LATE N. RAJAIAH ON 4TH DAY OF JULY 1994. THE HON'BLE COURT OF ADDL.DIST & SESSION JUDGE, RR.DIST HAS CONSIDERED THE ASSESSEE MR. N.R. KRI SHNAMURTHY AS A PLAINTIFF. THIS IS ENOUGH TO SHOW AND ESTABLISH THE OWNERSHIP OF THE ASSESSEE ON THE PROPERTY. WE ARE HEREWITH ENCLOSING A COP Y OF ORDER PASSED BY THE HON'BLE COURT OF ADDL.DIST & SESSION JUDGE, R.R.DIST. IN CASE OF N.R. KRISHNA MURTHY HAS NOT CONSIDERED AS PLAINTIFF, IT MAY BECOME CONTEMPT OF THE COURT. SUBSEQUENTLY, KOTHA J ANAMMA REGISTERED THE SAME LAND BY EXECUTING THE 'SALE DEED' ON 27TH DAY OF MARCH 1995 TO NCHANDRASEKHAR RAO S/O SRI LATE N RAJAIAH, SRI R. MADHUSUDAN SIP SRI LATE N RAJAIAH, SRI N.R.MURALI KRISHNA S/O SRI LATE N RAJAIAH. THE SAID THREE PARTIES ARE OWN BROTHERS O F MR. KRISHNA MURTHY. SINCE MR. NR.KRISHNA MURTHY ENTERED THE 'AGREEMENT OF SALE' HIS NAME WAS EXCLUDED IN THE 'SALE DEED'. THE LAND WAS REGISTERED IN THE NAME OF SAID THREE PARTIES WAS THE SAME LAND FOR WHICH MR. NR.KRISHNA MURTHY ENTERED AN 'AGREEMENT OF SALE'. THERE IS NEITHER DUPLICATION NOR SEPARATE REGISTRATION OF DIFFERENT LANDS. MR. N . R. KRISHNA MURTHY, ALONG WITH THREE BROTHERS JOINTLY RELINQUISHED THEIR RIGHTS IN FAVOUR OF M / S TEAM ONE BUILDERS AND AGREED TO RECEIVE RS. 4CRORES AS CONSIDERATION. AS A PART OF THE SAID SETTLEMENT AN AMOUNT OF RS. 1,60,00,000/ - PAID BY M / S TEAM ONE BUILDERS BY WAY BY CHEQUE NO. 116226, 116227, 116228, 116229 EACH OF RS. 40,00,000/RECEIVED BY ALL THE FOUR BROTHERS FROM INC VYSHYA BANK LTD., HIMAYATNAGAR BRANCH, HYDER ABAD. ALL THE FOUR BROTHERS WERE HAVING INTEREST/TITLE IN THE SAID PROPERT Y THROUGH SALE AGREEMENT DATED 04 - 07 - 1994 AND SALE DEED DATED 27 - 03 - 1995 AND BECAUSE OF THIS LEGAL ISSUE ALL THE FOUR BROTHERS HAVE EXECUTED THE SAME AND RECEIVED CONSIDERATION INDIV IDUALLY. THE SAID ASSESSEE MR. N.R. KRISHNA MURTHY INVESTED THE SAME IN 54EC CAPITAL CAIN BONDS. FOR THE REMAINING RS. 2,40,00,000/ - THE DEVELOPER PROMISED TO GIVE I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 5 - : 24,200 SQ. F EET TO THE SAID FOUR PARTIES I.E., 6,050 SQ. FEET FOR EACH INDIVIDUAL. THIS IS E QUIVALENT TO RS. 60, 00 ,000/ - . THE ASSESSEE MR. N. R. KRISHNA MURTHY FILED HIS RETURN ACCORDINGLY AND CLAIMED THE EXEMPTION U/E 54EC & 54F. THE OBSERVATION MADE BY YOUR GOOD OFFICE 'THAT THE ENTIRE CAPITAL GAIN OF RS. 92,40,479/ARISING OUT OF THE TRANSACT ION IS ASSESSABLE IN ASSESSEE'S HANDS' IS NOT CORRECT AS MR. NR. KRISHNA MURTHY'S SHARE IS ONLY 1/4TLT OF THE TOTAL TRANSACTION OF RS. 4 CRARES I.E., RS. 1 CRORE ONLY (RS. 40, 00,000/ - BY CASH + RS. 60,00,000/ - IN CONSTRUCTED AREA 6,050 SQ. FEET). THE ASSES SEE CLAIMED THE TOTAL CAPITAL GAIN ON THE RECEIPT OF RS. 1,00,00,000/ - ONLY. IT IS NOT CORRECT THAT THE ASSESSEE CLAIMED RS. 92,47,479/ - U/S 54F IN FACT IT IS ONLY RS. 54,98,085/ - . IT IS COMPUTED AS BELOW: POINT NO.1 :THE TOTAL CAPITAL GAIN ARRIVED AT RS. 92,40,479/ - POINT NO.2: U/S 54 E C RS. 39,30,000/ - U/S 54F PROPORTIONATE OF RS. 54,98,085/ - (59,50,000 X 92,40 , 479) --------------------------- 1,00,00,000 RS. 94,28,085 =============== THE ASS ESSEE CLAIMED CAPITAL GAIN EXEMPTION OF RS. 92,40,479/ - IS LESSER THAN THE AMOUNT OF POINT NO.2 I.E., 94,28,085/ - . ONE SIDE THE AO IS ACCEPTING UNDISPUTEDLY THAT THE ASSESSEE HAS RECEIVED A CONSIDERATION OF RS. 1 CRORE AND OTHER SIDE NOT ACCEPTING THE AS SESSEE AS A OWNER OF THE PROPERT Y WHICH IS TOTALLY WRONG. ASSESSING THE ASSESSEE'S INCOME AS 'INCOME FROM OTHER SOURCES' INSTEAD OF 'INCOME FROM CAPITAL GAINS' IS NOT CORRECT. HIGHLIGHTS : 1. THAT THE LAND OF 2.07 GUNTAS BELONGS TO FOUR BROTHERS AND NOT MR. N.R. KRISHNA MURTHY ALONE. 2. THE AO HAS EXAMINED ALL THE DOCUMENTS AND DEBATED THE SAME AT LENGTH BEFORE THE ADDL.CIT, RANGE - 5, HYDERABAD AND CONCLUDED THE CASE. 3. THE ASSESSEE INVESTED THE TOTAL CONSIDERATION RECEIVED BELONGS TO HIS SHARE IN 54 EC BONDS AND 54F. 4. THERE IS NO CONCEALMENT OF INFORMATION AND FACTS. 5. THERE IS NO REVENUE LOSS TO THE DEPARTMENT IN THE CASE OF ASSESSEE. THEREFORE, WE REQUEST YOUR HON'B L E SELVES TO GO THROUGH THE FACTS AND SPIRIT OF THE FACTS AND COMPLETE THE A SSESSMENT'. I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 6 - : 5. LD. CIT(A) HOWEVER, DID NOT AGREE WITH ASSESSEES SUBMISSIONS AND DISMISSED THE APPEAL BY STATING AS UNDER: 4. I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE, ASSESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. IN THIS CASE, THE E NTIRE CAPITAL GAIN IS OF RS. 92,40,479/ - ARISING OUT OF THE TRANSACTION. THE APPELLANT'S SHARE IS ONLY 1/4TH OF THE TOTAL TRANS ACTION OF RS. 4.0 CRORES I E., RS. 1 CRORE ONLY (RS. 40,00,000 BY CASH + RS. 60,00,000 IN CONSTRUCTED AREA 6,050 SQ. FEET). THE AP PELLANT CLAIMED THE TOTAL CAPITAL GAIN RECEIVED IN CASH OF RS. 1,00,00,000/ - ONLY. DURING THE COURSE OF APPEAL PROCEEDINGS, ALL THE DETAILS FILED BEFORE THE ASSESSING OFFICER WERE ALSO FILED BEFORE ME WHICH INCLUDES THE COPY OF ADDL.DISTRICT AND SESSIONS J UDGE COURT ORDER DATED 25 - 06 - 2008. AS PER THE COURT ORDER DATED 25 - 06 - 2008 , THE COURT DECIDED THE THREE PLAINTIFFS NAMELY SRI N.CHANDRA SHEKAR RAO, SRI R. MADHUSUDHAN AND SRI N.R.MURALI KRISHNA AS OWNERS. FURTHER, THE HON'BLE COURT HAS CONSIDERED THE APPE LLANT AS A PLAINTIFF BUT NOT CONSIDERED AS OWNER. THE APPELLANT, HAS NOT EXPLAINED HOW IT ESTABLISHES THE OWNERSHIP OF THE APPELLANT ON THE PROPERTY AS THE SALE DEED WAS REGISTERED IN FAVOUR OF APPELLANT'S THREE BROTHERS AND THE APPELLANT IS NOT A PARTY TO THE SALE DEED. BUT AS PER THE RECEIPT ENCLOSED ALONG WITH SALE DEED COPY DATED 27 - 03 - 1995 WHICH WAS ALSO RELIED UPON BY THE ASSESSING OFFICER, THE APPELLANT ALSO RECEIVED THE AMOUNT ALONG WITH OTHER THREE BROTHERS. SINCE THIS IS A FACT THAT THE APPELLANT HAS RECEIVED AN AMOUNT OF RS. 1,00,00,000/ - AND HE HIMSELF DISCLOSED IN THE RETURN OF INCOME AND CLAIMED ONLY RS. 39,00,000/ - U/S 54EC. IN THE LIGHT OF THESE FACTS AND DOCUMENTARY EVIDENCES THE AMOUNT DISCLOSED BY THE APPELLANT NOT TO BE TREATED AS SALE CO NSIDERATION. THEREFORE, ALL THESE FACTS WERE ALSO MENTIONED BY THE ASSESSING OFFICER IN HIS ASSESSMENT ORDER AND THEREBY THE ASSESSMENT MADE BY THE ASSESSING OFFICER BY TREATING THE SAID AMOUNT UNDER THE HEAD 'INCOME FROM OTHER SOURCES', WAS CONFIRMED. HE NCE, ALL THE SUBMISSIONS MADE BY THE APPELLANT ARE REJECTED . 6. BEFORE US, LD. COUNSEL REFERRING TO THE PAPER BOOK FILED IN THIS REGARD AND SUBMISSIONS MADE BEFORE THE AO AND CIT(A) SUBMITTED THAT IT WAS MR. KRISHNA MURTHY, WHO ORIGINALLY ENTERED INTO AN ORAL AGREEMENT OF SALE AND ALSO BECAME A PLAINTIFF IN THE PROCEEDINGS BEFORE THE ADDL. DISTRICT & SESSION JUDGE, INDICATING THAT ASSESSEE IS OWNER OF THE PROPERTY. IT WAS FURTHER SUBMITTED THAT THE HON'BLE HIGH COURT ALSO CONSIDERED ASSESSEE AS THE PLAIN TIFF AND SUBSEQUENTLY, THERE WAS A RECTIFICATION DEED BETWEEN THE PARTIES AND TEAM ONE BUILDERS, WHICH ALSO INCLUDES MR. N.R. KRISHNA MURTHY, ASSESSEE AS PARTY OF THE SECOND PART. IT WAS FURTHER SUBMITTED THAT ASSESSEE HAS RECEIVED CONSIDERATION ACCORDING LY AS HIS SHARE WAS 1/4 TH IN THE PROPERTY. IT WAS I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 7 - : SUBMITTED THAT LD. CIT(A) WAS NOT CORRECT IN APPROVING THE STAND TAKEN BY THE AO THAT ASSESSEE IS NOT AN OWNER , CONSEQUENTLY THE INCOME IS TO BE ASSESSED UNDER THE HEAD OTHER SOURCES. 7. LD. DR HOWEVE R, SUPPORTED THE ORDERS OF THE AUTHORITIES. 8. WE HAVE CONSIDERED THE ISSUE AND PERUSED THE RIVAL CONTENTIONS. AS CAN BE SEEN FROM THE DOCUMENTS PLACED ON RECORD, THE ORIGINAL SALE DEED BY SMT. K. JANAMMA IS IN THE NAME OF THREE PERSONS AS STATED ABOVE I N WHICH ASSESSEES NAME IS NOT THERE. THE SAID DEED WAS REGISTERED FOR A VALUE OF RS. 1,80,000/ - IN 1995 AND ASSESSEE HAS NOT PLACED ANY EVIDENCE ON RECORD THAT THE SAID SALE CONSIDERATION (PURCHASE CONSIDERATION) WAS PAID BY ASSESSEE NOR ANY EVIDENCE TO SHOW THAT HE HAS CONTRIBUTED 1/4 TH SHARE FOR PURCHASE OF THE PROPERTY. AS SEEN FROM THE PETITION BEFORE THE ADDL. DISTRICT & SESSION JUDGE , RANGA REDDY DISTRICT AS PLACED IN PAGE 7 & 8 OF THE PAPER BOOK, THE PARTIES AS PLAINTIFFS ARE: I. N. CHANDRA SE KHAR RAO; II. R . MADHUSUDHAN; III. N.R. MURALI KRISHNA; AND IV. N.R. KRISHNA MURTHY THE CLAIM MADE AS RECORDED IN THE ORDER DT. 25 - 06 - 2008 WAS AS UNDER: CLAIM : THIS SUIT FILED U/S. 26 R/W. O - 7 R - 1&2 CPC FILED BY THE PLAINTIFFS PRAYING THIS COURT TO DECLARE THAT THE PLAINTIFFS 1 TO 3 ARE ABSOLUTE OWNERS AND POSSESSORS OF SUIT SCHEDULE PROPERTY AND CONSEQUENTLY BY WAY OF INJUNCTION, DIRECT THE DEFENDANTS, THEIR AGENTS, THEIR HENCHMEN AND THEIR ASSIGNEES ETC., NOT TO INTERFERE IN THE SUIT SCHEDULE PR OPERTY. (OR) I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 8 - : TO DIRECT THE DEFENDANT NO. 1 TO EXECUTE THE REGULAR REGISTERED SALE DEED BY RECEIVING THE BALANCE SALE CONSIDERATION OF RS . 3,30,760/ - , IN THE EVENT OF THIS HON'BLE COURT COMING TO CONCLUSION THAT THE DEFENDANT NO. 2 DID NOT HAVE POWER TO EXECUTE THE REGISTERED SALE DEED DT: 27 - 3 - 1995 VIDE DOCUMENT NO. 4429 OF 1995) IN FAVOUR OF PLAINTIFFS 1 TO 3 AND CONSEQUENTLY DIRECT THE DEFENDANT NO. 2 TO REFUND THE AMOUNT OF RS. 3,30,760/ - TOGETHER WITH AN INTEREST @ 15% PA AMOUNTING TO RS. 8,41,646 - 38 PAISE FROM 27 - 3 - 1995 TO 7 - 7 - 2005 IE., DATE OF FILING THIS SUIT TOGETHER WITH SUBSEQUENT INTEREST TILL THE ENTIRE AMOUNT IS REPAID AND TO AWARD COSTS OF THE SUIT. THUS, AS CAN BE SEEN FROM THE ABOV E, THE PRAYER BEFORE THE COURT WA S ONLY TO DECLARE PLAINT IFFS 1 TO 3 I.E., I. N. CHANDRA SEKHAR RAO; II. R . MADHUSUDHAN; AND III. N.R. MURALI KRISHNA; AS ABSOLUTE OWNERS AND POSSESSORS OF SUIT SCHEDULE PROPERTY. THIS ALSO INDICATES THAT ASSESSEE BEING THE 4 TH PLAINTIFF , DID NOT CLAIM ANY OWNERSHIP OF THE PROP ERTY. THEREFORE, WE ARE OF THE OPINION THAT BOTH THE AUTHORITIES ARE CORRECT IN REJECTING ASSESSEE AS OWNER OF THE PROPERTY. EVEN THE RECT IFICATION DEED PLACED ON RECORD NO WHERE CONFERS ANY OWNERSHIP ON ASSESSEE EXCEPT INDICATING THAT ASSESSEE IS ALSO P ARTY TO THE TRANSACTIONS WITH M/S. TEAM ONE BUILDERS. HOW ASSESSEE ACQUIRED THE OWNERSHIP WAS NOT ESTABLISHED EITHER BEFORE THE CIT DURING THE COURSE OF PROCEEDINGS U/S. 263 OR BEFORE THE OTHER AUTHORITIES IN THE COURSE OF CONSEQUENTIAL ASSESSMENT PROCEEDI NGS. EXCEPT THE FACT THAT ASSESSEE HAS RECEIVED THE SO CALLED 1/4 TH SHARE OUT OF THE TOTAL CONSIDERATION, THERE IS NO INDICATION OF ANY ASSESSEES OWNERSHIP ON THE PROPERTY , EITHER TO FULL EXTENT OR TO 1/4 TH EXTENT. IF ONE WERE TO CONSIDER THAT ASSESSEE ENTERED INTO AGREEMENT OF SALE IN HIS NAME , BUT GOT THE PROPERTY REGISTERED IN HIS THREE BROTHERS NAME, THE LD. CIT(A) HAS MADE A PROPOSAL TO ASSESSEE THAT THE ENTIRE CAPITAL GAIN CAN BE ASSESSED IN ASSESSEES HANDS , WHICH WAS OBJECTED TO AS CAN BE SEEN FR OM THE WRITTEN SUBMISSIONS EXTRACTED ABOVE. THIS INDICATES THAT THO SE THREE BROTHERS ARE NOT BENAMI OWNERS OF ASSESSEE. WHY ASSESSEE HAS INCLUDED AS PLAINTIFF AND I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 9 - : HOW HE RECEIVED THE CONSIDERATION AND CIRCUMSTANCES WHICH ARE IN THE KNOWLEDGE OF ASSESSEE ARE NOT EXPLAINED, BUT IT IS A FACT THAT ASSESSEE RECEIVED THE CONSIDERATION OF RS 1 CRORE IN THE SAID TRANSACTION. T HEREFORE, SINCE THE OWNERSHIP ON THE PROPERTY IS NOT ESTABLISHED TO BE THAT OF ASSESSEE , EITHER AT 1/4 TH OR FULLY, WE ARE OF THE OPINION TH AT THE AUTHORITIES ARE JUSTIFIED IN TREATING THE CONSIDERATION RECEIVED BY ASSESSEE AS INCOME FROM OTHER SOURCES AND DENYING THE DEDUCTIONS CLAIMED U/S. 54EC AND 54F WHICH ARE APPLICABLE ONLY WHEN THERE IS CAPITAL GAINS. WE DO NOT FIND ANY MERIT IN ASSE SSEES CONTENTIONS. ACCORDINGLY, THE GROUNDS RAISED ARE DISMISSED. 9. IN THE RESULTS, APPEAL OF ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07 TH APRIL, 2016 SD/ - SD/ - (P. MADHAVI DEVI) (B. RAMAKOTAIAH) JUDICIAL MEMBE R ACCOUNTANT MEMBER HYDERABAD, DATED 0 7 TH APRIL , 2016 TNMM I.T.A. NO. 1424 / HYD / 20 1 5 SHRI N.R. KRISHNA MURTHY : - 10 - : COPY TO : 1. N.R. KRISHNA MURTHY, 5 - 2 - 1028, N.S. NAGAR, M.J. ROAD, HYDERABAD. 2 . INCOME TAX OFFICER , WARD - 5 (2), HYDERABAD. 3 . CIT(APPEALS) - 4 , HYDERAB AD. 4. PR. CIT - 4 , HYDERABAD. 5 . D.R. ITAT, HYDERABAD. 6 . GUARD FILE.