Maya Varadarajan, CHENNAI V. DCUT, CHENNAI

ITA 2075/CHNY/2015

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 9375 (ITAT-CHENNAI)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-05-2016
• Appeal Filed By: Assessee
• Bench Allotted: C
• Next Hearing Date: 02-03-2016
• Assessment Year: 2012-2013
• Appeal Filed On: 26-10-2015
• Court: TRIBUNAL
• Department Lawyers: SUNDAR RAOCPT
• Assessee Lawyers: R VIJAYARAGHAVAN
• Keywords: Capital asset; Gift; Charitable institution; Cost of acquisition; Revocable transfer
• Section: 54F; 63

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI , ! ' . #$ % &' BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY , JUDICIAL MEMBER ./ I.T.A.NO.2074/MDS./2015 / ASSESSMENT YEAR : 2012-13 SHRI T.T.SIDDARTH , 10/5,ROYAL ENCLAVE, BESANT AVENUE ROAD, ADYAR, CHENNAI 600 020. VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE-4(1), CHENNAI-34. [PAN CPNPS 7361 L ] ( () / APPELLANT) ( *+() /RESPONDENT) ./ I.T.A.NO.2075/MDS./2015 / ASSESSMENT YEAR : 2012-13 SMT.MAYA VARADARAJAN, 10/5,ROYAL ENCLAVE, BESANT AVENUE ROAD, ADYAR, CHENNAI 600 020. VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE-4(1), CHENNAI-34. [PAN ACJPV 8425 H ] ( () / APPELLANT) ( *+() /RESPONDENT) / APPELLANT BY : MR.R.VIJAYARAGHAVAN,ADVOCATE /RESPONDENT BY : MR.SUNDAR RAO,CPT, DR / DATE OF HEARING : 16 - 03 - 201 6 / DATE OF PRONOUNCEMENT : 11 - 05 - 2016 ITA NOS. 2074 & 2075/MDS./15 :- 2 -: , / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THESE TWO APPEALS FILED BY DIFFERENT ASSESSEES A RE DIRECTED AGAINST THE DIFFERENT ORDERS OF THE LD.CIT(A)-8, CH ENNAI, BOTH ORDER DATED 14.09.2015 FOR SAME ASSESSMENT YEAR 2012-13 P ASSED U/S.143(3) OF THE INCOME TAX ACT, 1961. SINCE ISSUE S INVOLVED IN THESE TWO APPEALS ARE COMMON IN NATURE, THESE APPEALS ARE CLUBBED TOGETHER, HEARD TOGETHER, DISPOSED OFF BY THIS COMM ON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE COMMON ISSUE IN THESE TWO APPEALS OF DIFFE RENT ASSESSEES IS WITH REGARD TO TREATMENT OF ASSET TRANSFERRED VI Z. TRADE MARK AS SHORT TERM CAPITAL GAINS AND DISALLOWING THE CLAIM U/S.54F OF ` 8 CRORES IN RESPECT OF ASSESSEE VIZ. SHRI T.T.SIDDARTH AND O F ` 36.99 CRORES IN RESPECT OF ASSESSEE VIZ. SHRI MAYA VARADARAJAN. 3.1 THE BRIEF FACTS OF THE CASE ARE THAT BOTH THE ASS ESSEE ARE AN INDIVIDUAL. FOR THE ASSESSMENT YEAR 2012-13, THE AS SESSEE IN RESPECT OF ASSESSEE VIZ. SHRI T.T.SIDDARTH FILED RETURN OF IN COME ON 29.08.2012 SHOWING INCOME FROM SALARIES ` 43,35,985/-, INCOME FROM OTHER SOURCES ` 3,07,6751- AND LONG TERM CAPITAL GAINS OF ` 12,00,00,000/- AND CLAIMED EXEMPTION UNDER SECTION 54F OF ` 8 CRORES, AND ASSESSEE VIZ. SHRI MAYA ITA NOS. 2074 & 2075/MDS./15 :- 3 -: VARADARAJAN FILED RETURN OF INCOME ON 29.08.2012 SH OWING INCOME FROM PROPERTY RS.39,980/-, AND LONG TERM CAPITAL GAINS O F ` 3,00,09,084/- AND CLAIMED EXEMPTION UNDER SECTION 54F OF ` 36.99 CRORES. 3.2 DURING THE COURSE OF ASSESSMENT PROCEEDINGS, T HE AO FOUND THAT THE ASSESSEE HAD BEEN GIFTED TRADE MARK BY MRS MALATHI RANGASWAMI AND MR TT VARADARAJAN BY DEED OF SETTLEMENT DATED 19.12.2010. THE CAPITAL ASSET BEING TRADEMARK WAS SETTLED WITHOUT ANY CONSIDERATI ON OF ANY MONEY OR MONEYS WORTH AND WAS TRANSFERRED OUT OF NATURAL LO VE AND AFFECTION FOR THE ASSESSEE. THE ASSSSEE CLAIMED EXEMPTION UNDER SECT ION 49(1)(II) SINCE THE PERIOD DURING WHICH THE PREVIOUS OWNERS HELD THE RI GHT OVER THE TRADE MARK WAS ALSO TO BE CONSIDERED FOR DECIDING WHETHER THE ASSET IS OF TONG TERM, THE ASSESSING OFFICER WHILE ASSESSING THE ASSESSMEN T ORDER U/S.143(3) ON 28.02.2015 HAS REJECTED THE ASSESSEES CLAIM FOR DE DUCTION UNDER SECTION 54F BY TREATING THE PERIOD OF HOLDING OF THE ASSETS AS SHORT TERM ON THE GROUND THAT (A) THE ASSESSEE HAD NOT ACQUIRED THE CAPITAL ASSET S EITHER THROUGH GIFT OR THROUGH A WILL BUT BY A SETTLEMENT DEED, THEREFO RE, EXPLANATION 1 (I)(B) TO SECTION 2(42A) READ WITH SECTION 49(1)(II ) WAS NOT APPLICABLE TO THE FACTS OF THE CASE. (B) AS THE ASSESSEE HAD NOT HELD THE ASSET FOR A PE RIOD OF 36 MONTHS PRECEDING THE DATE OF TRANSFER IT WOULD BE SHORT TE RM CAPITAL ASSET AND DEDUCTION U/S.54F IS TO BE ALLOWED ONLY WHERE T HE CAPITAL GAINS ARISE FROM LONG TERM CAPITAL ASSETS. ITA NOS. 2074 & 2075/MDS./15 :- 4 -: (C) MEANING OF GIFT IS TO BE STRICTLY ADHERED TO AN D DEFINITION GIVEN IN THE GIFT TAX ACT CANNOT BE IMPORTED INTO THE INCOME TAX ACT (D) TRANSFER OF TRADE MARK WAS DONE WITH MALA FIDE INTENTION TO EVADE TAX. THEREFORE, THE AO DISALLOWED THE CLAIM U/S.54F OF ` 8 CRORES IN RESPECT OF ASSESSEE VIZ. SHRI T.T.SIDDARTH AND OF ` 36.99 CRORES IN RESPECT OF ASSESSEE VIZ. SHRI MAYA VARADARAJAN. AGGRIEVED WITH THE ACTION OF THE AO, THE ASSESSEES WERE FILED APPEALS BEFORE THE LD.CIT( A). 3.3 ON APPEAL, LD.CIT(A) OBSERVED THAT THE PRIMARY ISSUE THAT NEEDS TO BE SETTLED IS WHETHER THE CAPITAL ASSET RECEIVED BY THE ASSESSEE THROUGH A SETTLEMENT DEED IS A GIFT, IF SO, WHETHER THE PROVI SIONS OF SECTION 49(1) OF THE INCOME TAX ACT APPLY TO THIS CASE. TRANSFER UNDER THE INCOME TAX ACT IS DEFINED AT SECTION 63 AS UNDER: TRANSFER AND REVOCABLE TRANSFER DEFINED. FOR THE PURPOSES OF SECTIONS 60, 61 AND 62 AND OF T HIS SECTION, (A) A TRANSFER SHALL BE DEEMED TO BE REVOCABLE IF I) IT CONTAINS ANY PROVISION FOR THE RE-TRANSFER DI RECTLY OR INDIRECTLY OF THE WHOLE OR ANY PART OF THE INCOME OR ASSETS TO THE TR ANSFEROR, OR (II) IT, IN ANY WAY, GIVES THE TRANSFEROR A RIGHT T O RE-ASSUME POWER DIRECTLY OR INDIRECTLY OVER THE WHOLE OR ANY PART O F THE INCOME OR ASSETS; (B) TRANSFER INCLUDES ANY SETTLEMENT, TRUST, COVE NANT, AGREEMENT OR ARRANGEMENT. TRANSFER INCLUDES SETTLEMENT SINCE SETTLEMENT MAY A LSO INVOLVE CONVEYANCE OF PROPERTY AND IS LIABLE TO STAMP DUTY. ARTICLE 58 OF INDIAN STAMP ACT, REFERS TO THE STAMP DUTY PAYABLE ON EXECUTION AND REGISTRA TION OF SETTLEMENT ITA NOS. 2074 & 2075/MDS./15 :- 5 -: DEEDS. SETTLEMENT OF PROPERTY AMONG FAMILY MEMBERS AND OTHERS IS A MODE OF DISTRIBUTING BOTH MOVABLE AND IMMOVABLE PROPERTI ES AND HAS BEEN DEFINED UNDER SECTION 2 (24) OF THE INDIAN STAMP ACT. AS PE R THE INDIAN STAMP ACT A SETTLEMENT DEED IS A NON-TESTAMENTARY DISPOSITION, IN WRITING, OF MOVABLE OR IMMOVABLE PROPERTY MADE A) IN CONSIDERATION OF MARRIAGE, B) FOR THE PURPOSE OF DISTRIBUTING PROPERTIES OF SE TTLER AMONG HIS FAMILY OR THOSE FOR WHOM HE DESIRES TO PROVIDE FOR, OR FOR THE PURPOSE OF PROVIDING FOR SOME PERSON DEPENDENT ON HIM, OR C) FOR ANY RELIGIOUS OR CHARITABLE PURPOSES; 3.4 HOWEVER, AS PER THE INDIAN LAW THERE IS A MARK ED DIFFERENCE BETWEEN A SETTLEMENT AND OTHER INSTRUMENTS USED FOR CONVEYA NCE OF A PROPERTY. THE DISTINCTION BETWEEN SETTLEMENT AND OTHER RELATED IN STRUMENTS IS AS FOLLOWS. TRUST V/S SETTLEMENT A SETTLEMENT DEED SHOULD NOT BE MISTAKEN FOR A TRUS T DEED IN CASE OF TRUST, THE AUTHOR VESTS THE PROPERTY IN FAVOUR OF ITS TRUS TEES, WHO MANAGE, AND ADMINISTER THE PROPERTY /PROPERTIES AS PER THE DIRE CTION OF THE AUTHOR FOR THE BENEFIT OF THIRD PERSON/S CALLED BENEFICIARIES. THE TRUSTEES WILL ACT ONLY AS PER THE DIRECTIONS OF THE AUTHOR OF A TRUST DEED AND TH E BENEFICIARIES DO NOT HAVE ANY SAY IN THE MANAGEMENT OF THE SAID PROPERTIES. H OWEVER, IN SETTLEMENT, THERE IS NO INTERMEDIATE PERSON, LIKE A TRUSTEE AND THE BENEFICIARIES HAVE COMPLETE CONTROL OVER THE ADMINISTRATION, MANAGEMEN T OF THE PROPERTY SETTLED IN THEIR FAVOUR AND ENJOY THE PROPERTY AS A BSOLUTE OWNERS, SUBJECT TO THE CONDITIONS OF THE SETTLEMENT DEED. WILL V/S SETTLEMENT SETTLEMENT DEED IS DIFFERENT FROM WILL, SINCE A WIL L IS A TESTAMENTARY DOCUMENT, WHICH BECOMES OPERATIVE AFTER THE DEATH O F ITS AUTHOR, WHERE AS A SETTLEMENT BECOMES OPERATIVE IMMEDIATELY. ANOTHER DISTINGUISHABLE FEATURE IS THAT A WILL IS REVOCABLE AND THAT ANY NUMBER OF WILLS MAY BE EXECUTED ITS ITA NOS. 2074 & 2075/MDS./15 :- 6 -: AUTHOR IN RESPECT OF A SINGLE PROPERTY DURING HIS L IFE TIME, THOUGH ONLY THE LAST WILL EXECUTED BECOMES OPERATIVE. WHEREAS, SETT LEMENT IS NOT REVOCABLE AND AFTER THE PROPER EXECUTION OF A SETTLEMENT DEED , THE SETTLER RELINQUISHES ALL HIS RIGHTS, TITLE AND INTEREST OVER THE SAID PR OPERTY, SUBJECT TO THE TERMS CONDITIONS CONTAINED IN THE SETTLEMENT DEED. PARTITION V/S SETTLEMENT USUALLY PARTITION OF JOINT PROPERTIES IS MISTAKEN F OR SETTLEMENT. HOWEVER, PARTITION CONSTITUTES DIVISION OF PROPERTIES BETWEE N THE JOINT OWNERS AS WELL AS THE DIVISION OF JOINT INTEREST OWNERSHIP IN THE PROPERTY. THUS, THE DIVISION AMOUNTS TO SEVERANCE OF THE JOINT INTEREST IN THE O WNERSHIP OF THE COMMON PROPERTIES AND THE COMMON PROPERTY IS THUS DIVIDED AMONG THEM. EACH PARTNER BECOMES THE ABSOLUTE OWNER OF HIS SHARE AND EACH PARTNERS SHARE IS SUBJECT TO A PREDETERMINED PERCENTAGE, GOVERNED BY EITHER THE INHERITANCE LAWS OR BY THE PARTNERSHIP DEED AS THE CASE MAY BE. IN SETTLEMENT, HOWEVER, THE PROPERTY IS OWNED BY A THIRD PERSON AND IS SETT LED IN FAVOUR OF PERSONS WHO DO NOT HAVE ANY PREVIOUS INTEREST IN THE SAID P ROPERTY AND THE SHARE OF THE BENEFICIARY IS AS PER THE WISHES OF THE SETTLER . GIFT AND SETTLEMENT THERE ARE MARKED DIFFERENCES BETWEEN GIFT AND SETTL EMENT. GIFT IS NOT MADE FOR ANY CONSIDERATION, WHEREAS SETTLEMENT MAY BE IN CONSIDERATION OF MARRIAGE. LIKE-WISE GIFT MAY BE MADE TO ANY PERSON, WHERE AS A SETTLEMENT IS MOSTLY MADE IN THE FAVOUR OF DEPENDENTS. ALSO GI FT REQUIRES ACCEPTANCE WHEREAS SETTLEMENT DOES NOT. THE GIFT IS REVOCABLE OR MAY BE SUSPENDED AS PER SECTION 126 OF THE TRANSFER OF PROPERTY ACT ON HAPPENING OF ANY SPECIFIED EVENT, WHICH DOES NOT DEPEND ON THE WILL OF THE DONOR UNLIKE THAT OF SETTLEMENT, WHICH IS FINAL & BINDING ONCE IT IS EXECUTED BY THE SETTLER. 3.5 THUS IT MAY BE SEEN FROM THE ABOVE, THAT THERE ARE STRIKING DIFFERENCES BETWEEN A SETTLEMENT AND A GIFT. UNDER NO CIRCUMSTANCES CAN A ITA NOS. 2074 & 2075/MDS./15 :- 7 -: SETTLEMENT BE EQUATED TO A GIFT. THE APPELLANTS CO NTENTION OF IMPORTING THE DEFINITION OF GIFT FROM THE GIFT TAX ACT, 1958, WHI CH IS NO LONGER IN EXISTENCE, IS NOT A VALID PROPOSITION. 3.6 HAVING COME TO A DECISION THAT A SETTLEMENT IS NOT A GIFT UNDER THE PREVALENT LAW, THE NEXT ISSUE TO BE RESOLVED IS WHE THER THE CAPITAL ASSET IS A LONG TERM CAPITAL ASSET OR A SHORT TERM CAPITAL ASS ET UNDER THE INCOME TAX ACT. THE RELEVANT PART OF THE SECTION 49 OF THE INCOME T AX ACT READS AS UNDER: COST WITH REFERENCE TO CERTAIN MODES OF ACQUISITION . 49. [(1)] WHERE THE CAPITAL ASSET BECAME THE PROPE RTY OF THE ASSESSEE- (I) ON ANY DISTRIBUTION OF ASSETS ON THE TOTAL OR P ARTIAL PARTITION OF A HINDU UNDIVIDED FAMILY; (II) UNDER A GIFT OR WILL; (III) (A) BY SUCCESSION, INHERITANCE OR DEVOLUTION, OR [(B) ON ANY DISTRIBUTION OF ASSETS ON THE DISSOLUTI ON OF A FIRM, BODY OF INDIVIDUALS, OR OTHER ASSOCIATION OF PERSONS, WHERE SUCH DISSOLUTION HAD TAKEN PLACE AT ANY TIME BEFORE THE 1ST DAY OF A PRIL, 1987, OR] (C) ON ANY DISTRIBUTION OF ASSETS ON THE LIQUIDATIO N OF A COMPANY, OR (D) UNDER A TRANSFER TO A REVOCABLE OR AN IRREVOCABLE T RUST, OR (E) UNDER ANY SUCH TRANSFER AS IS REFERRED TO IN CL AUSE (IV) [OR CLAUSE (V)] [OR CLAUSE (VI)] [OR CLAUSE (VIA)] [[OR CLAUSE (VIAA)] [OR CLAUSE (VICA) OR [CLAUSE (UICB)]J OR [CLAUSE (XIII) OR CLA USE (XIIIB) OR CLAUSE (XIV) OF SECTION 47]]; [(IV) SUCH ASSESSEE BEING A HINDU UNDIVIDED FAMILY , BY THE MODE REFERRED TO IN SUBSECTION (2) OF SECTION 64 AT ANY TIME AFTER T HE 31ST DAY OF DECEMBER, 1969,] THE COST OF ACQUISITION OF THE ASSET SHALL B E DEEMED TO BE THE COST FOR WHICH THE PREVIOUS OWNER OF THE PROP ARTY ACQUIRED IT, AS INCREASED BY THE COST OF ANY IMPROVEMENT OF THE ASSETS INCURRED OR B ORNE BY THE PREVIOUS OWNER OR THE ASSESSEE, AS ,THE CASE MAY BE. ONCE IT IS HELD THAT SETTLEMENT CANNOT BE CONSIDERE D AS A GIFT THE QUESTION OF APPLYING PROVISIONS OF SEC 49(1) DOES NOT ARISE. ON THE OTHER HAND WHAT ITA NOS. 2074 & 2075/MDS./15 :- 8 -: APPLY IN THE CASE OF APPELLANT ARE SECTIONS 2(42A) AND 2(42B), THE RELEVANT PORTIONS OF WHICH ARE REPRODUCED BELOW: (42A) SHORT-TERM CAPITAL ASSET MEANS A CAPITAL A SSET HELD BY AN ASSESSEE FOR NOT MORE THAN [THIRTY-SIX] MONTHS IMMEDIATELY P RECEDING THE DATE OF ITS TRANSFER: [EXPLANATION 1].(I) IN DETERMINING THE PERIOD FOR WHICH ANY CAPITAL ASSET IS HELD BY THE ASSESSEE- (A) - - - (B) IN THE CASE OF A CAPITAL ASSET WHICH BECOMES TH E PROPERTY OF THE ASSESSEE IN THE CIRCUMSTANCES MENTIONED IN SUB-SECTLON (1) O F SECTION 49, THERE SHALL BE INCLUDED THE PERIOD FOR WHICH THE ASSET WAS HELD BY THE PREVIOUS OWNER REFERRED TO IN THE SAID SECTION; (42B) SHORT TERM CAPITAL GAIN MEANS CAPITAL GAIN A RISING FROM THE TRANSFER OF A SHORT TERM CAPITAL ASSET; 3.7 THE TRADE MARK (CAPITAL ASSET) WAS HELD BY THE ASSESSEE DURING THE PERIOD BEGINNING FROM 19/12/2010 TO 6/04/2011 I.E., A PERIOD OF LESS THAN FOUR MONTHS. SINCE THE PROVISIONS OF SECTION 49 DO NOT APPLY IN THE CASE OF THE APPELLANT THE CAPITAL ASSET NEEDS TO BE HELD AS A SHORT TERM CAPITAL ASSET AS PER THE DEFINITION U/S 2(42A) READ WITH CLAUSE ( B) OF THE EXPLANATION 1 THERE UNDER. BEING A SHORT TERM CAPITAL ASSET THE C APITAL GAIN ARISING THERE FROM IS SHORT TERM CAPITAL GAIN AS PER SECTION 2(42 B) OF THE INCOME TAX ACT. FINALLY, THE LD.CIT(A) OBSERVED THAT ONCE IT IS HEL D THAT THE CAPITAL ASSET IS A SHORT TERM CAPITAL ASSET THE PROVISIONS OF SEC 54F ARE NOT APPLICABLE IN THE CASE OF THE ASSESSEE AND THE BENEFITS THERE UNDER H AVE BEEN RIGHTLY DENIED TO THE ASSESSEE BY THE ASSESSING OFFICER. ACCORDING LY, THE APPEAL OF THE ASSESSEE IS DISMISSED. AGAINST THIS, THE ASSESSEE IS IN APPEAL BEFORE US. 4.1 WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THE MAIN CONTENTION OF THE LD.A.R IS THAT THERE IS NO DIFFERENCE BETWEEN GIFT ITA NOS. 2074 & 2075/MDS./15 :- 9 -: AND SETTLEMENT AND THE EXPLANATION-1(I)(B) TO SEC.2 (42A) R.W.S.49(1)(II) OF THE ACT IS APPLICABLE. AS SUCH WHILE COMPUTING THE PERIOD OF HOLDING CAPITAL ASSETS, THE PERIOD OF HOLDING ALL THAT ASSET BY THE PREVIOUS OWNER TO BE CONSIDERED. ACCORDING TO HIM, ONCE WE CONSIDER THE THE PERIOD OF HOLDING OF PREVIOUS OWNER OF THE IMPUGNED CAPITAL ASSET, THEN THE HOLDING PERIOD BYTE PRESENT ASSESSEE IS MORE THAN THREE YEARS AND WHICH RESULTED IN COMPUTATION OF LONG TERM CAPITAL GAINS AND CONSEQUE NTLY, THE ASSESSEE IS ENTITLED FOR DEDUCTION U/S.54F OF THE ACT. FOR THI S PURPOSE HE HAS RELIED ON THE ORDER OF TRIBUNAL IN THE CASE OF ITO VS. SHRI A BDUL HAMEED KHAN MOHAMMED,CHENNAI IN ITA NO.1782/MDS./2015 FOR ASSES SMENT YEAR 2011-12 VIDE ORDER DATED 29.12.2015. WE FIND FORCE IN THE ARGUMENT OF THE LD.A.R. IN THESE TWO CASES, THE ASSETS GOT THE RIGHT, TITLE AND INTEREST IN THE REGISTERED TRADE MARK , NAMELY PREETT THROUGH SETTLEMENT DEED DATED 19/12/2010 FROM SETTLOR NAMELY MRS.MALATHY RANGASWA MI & MR.T.T.ASHOK. ACCORDING TO AO, DATE OF ACQUISITION OF THE RIGHT / TITLE/ INTEREST OVER THE SAID REGISTERED TRADE MARK IS ONLY FROM 19/12/2010, AS T HIS IS A SETTLEMENT DEED AND NOT IT IS A GIFT OR WILL AS MENTIONED IN SEC.49 (1)(II) OF THE ACT. 4.2 IN OUR OPINION, THE DISTINCTION MADE BY THE LO WER AUTHORITIES IS NOT CORRECT. THE TRIBUNAL IN THE CASE OF SHRI S.KRISHNA N VS. DCIT IN ITA NO.2075/MDS./2014 VIDE ORDER DATED 15.05.2015 OBSER VED THAT THOUGH THE ASSESSEE GOT THE LANDED PROPERTY WHILE SETTLEMENT D ATED 23.01.2004 FROM HIS MOTHER FOR THE PURPOSE OF COMPUTATION OF INDEXE D COST OF ACQUISITION FROM 01.04.1981 BY FOLLOWING THE JUDGMENT OF BOMBAY HIGH COURT IN THE CASE OF MANJULA J. SHAH REPORTED IN (2012) 204 TAX MAN 691. FURTHER THE ITA NOS. 2074 & 2075/MDS./15 :- 10 - : CO-ORDINATE BENCH IN THE CASE OF MR.ABDUL HAMEED KH AN MOHAMMED (SUPRA), IT IS CATEGORICALLY HELD THAT TRANSFER OF PROPERTY MADE VOLUNTARILY AND WITHOUT CONSIDERATION BY WAY OF SETTLEMENT DEED, AL L WITHIN THE DEFINITION OF GIFT AND THERE IS NO DIFFERENCE BETWEEN THE GIFT AN D SETTLEMENT U/S.49(1)(II) OF THE ACT. WHILE ADJUDICATING THIS, THE TRIBUNAL PLACED RELIANCE ON SEC.122 OF THE TRANSFER OF PROPERTY ACT, 1882 AND ALSO FROM THE COCHIN BENCH OF TRIBUNAL IN THE CASE OF ACIT VS. ANJANA MOHAN (2013 ) 36 CCH 0008(COCHIN) AND ALSO REDINGTON (INDIA) LTD. VS. JCIT REPORTED IN 40 CCH 527 (CHENNAI). 4.3. IN VIEW OF THIS, IN OUR OPINION THE ARTIFICI AL DISTINCTION MADE BY THE LOWER AUTHORITIES WITH REFERENCE TO THE GIFT AND SE TTLEMENT IS NOT APPROPRIATE AND WE ARE OF THE OPINION THAT FOR THE PURPOSE OF S EC.49(1)(II), THERE IS NO DIFFERENCE BETWEEN THE GIFT AND SETTLEMENT AND IN T HE PRESENT CASE, THE SETTLEMENT MADE BY MRS.MALATHY RANGASWAMI & MR.T.T. ASHOK IN FAVOUR OF MRS.MAYA VARADARAJAN TO BE CONSIDERED AS GIFT IN TE RMS OF SEC.49(1)(II) OF THE ACT AND ACCORDINGLY, EXPLANATION-1(I)(B) TO SEC .2(42A) TO BE APPLIED SO AS TO COMPUTE THE HOLDING PERIOD OF THE ASSET AFTE R CONSIDERING THE HOLDING PERIOD OF THE SAID CAPITAL ASSET BY PREVIOUS OWNER I.E. SETTLOR. IN THE PRESENT CASE, THE DATE FROM WHICH SETTLOR HOLDI NG THE TITLE OVER THE REGISTERED TRADE MARK PREETT IS NOT AVAILABLE ON RECORD AND WE ARE NOT IN A POSITION TO GIVE A FINDING WHETHER TRANSFER OF THIS TRADE MARK BY THE PRESENT ASSESSEE WOULD GIVE RISE TO SHORT/LONG TERM CAPITAL GAINS. HENCE, THIS ISSUE IS REMITTED TO THE FILE OF AO TO DETERMINE THE PERIOD OF HOLDING OF THIS IMPUGNED CAPITAL ASSET AND DECIDE THE ISSUE AFRESH. ITA NOS. 2074 & 2075/MDS./15 :- 11 - : ITA NO.2074/MDS./2015 5. IN CASE OF T.T.SIDDARTH, THE SETTLOR NAMELY MRS.MALATHY RANGASWAMI, & MR.T.T.ASHOK VOLUNTARILY SETTLE THE R IGHT, TITLE, INTEREST IN REGISTERED TRADE MARK LOGO PREETHI IN FAVOUR OF MR.T.T.SIDDARTH, WHO IS THE PRESENT ASSESSEE. SINCE THE FACTS AND CIRCUM STANCES IN THIS CASE ALSO ARE SIMILAR TO THAT ONE, IN THE CASE OF SMT.MAYA VA RADARAJAN, APPLYING THE RATIO LAID DOWN IN EARLIER PARA IN THE CASE OF SAID ASSESSEE, THIS IS REMITTED TO THE FILE OF AO FOR FRESH CONSIDERATION ON SIMILAR D IRECTION. 6. IN THE RESULT, BOTH THE APPEALS OF THE DIFFERENT AS SESSES IN ITA NO.2074/MDS./2015 AND ITA NO.2075/MDS./2015 ARE PAR TLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH MAY, 2016, AT CHENNAI. SD/ - SD/ - ! ! ' . #$ ' ( DUVVURU RL REDDY ) ) % / JUDICIAL MEMBER ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 11 TH MAY, 2016. K S SUNDARAM &'(( )*(+* / COPY TO: ( 1 . / APPELLANT 4. ( , / CIT 2. / RESPONDENT 5. *-.( / / DR 3. ( ,(!' / CIT(A) 6. .0(1 / GF