SHRI RADHESHYAM M. KHETAN, KAMPTEE V. ITO WARD, 7(1), Nagpur

ITA 209/NAG/2013

• Counselvise Citation: 20923914 RSA 2013
• Duration Of Justice: 8 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-02-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 13-05-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: NARENDRA KANE
• Assessee Lawyers: M MANI
• Keywords: Capital asset; Cost of acquisition; Competent authority; Capital receipt
• Section: 2(14)

Judgement Text

- IN THE INCOME TAX APPELLATE TRIBUNAL-E -BENCH, NAGPUR ! ! ' ! /(THROUGH VIDEO CONFERENCE AT MUMBAI) # # # # $ $$ $ % %% % . . , '& '& '& '& $ $$ $ '!() '!() '!() '!() , ! !! ! . . BEFORE S/SH.H.L.KARWA,PRESIDENT AND RAJENDRA,ACCOUNTANT MEMBER /. ITA NO.209/NAG/2013 # # # # *# *# *# *# / ASSESSMENT YEAR 2009-10 RADHESHYAM M. KHETAN KHETAN, JUNI BHAJI, MANDI,KAMPTEE-441002 PAN: ADWPK2931M VS. ITO WARD 7(1) MECL BUILDING, AMBEDKAR BHAVAN, NAGPUR. ( +, / APPELLANT) ( -.+, / RESPONDENT) ASSESSEE BY : M.MANI REVENUE BY : NARENDRA KANE / 0 / DATE OF HEARING : 22- 01 -201 4 1* / 0 /DATE OF PRONOUNCEMENT : 03 - 02 -201 4 , 1961 254 )1( ! !! ! (/#/ (/#/ (/#/ (/#/ 2!3 2!3 2!3 2!3 ORDER U/S.254(1)OF THE INCOME-TAX ACT,1961(ACT) PER RAJENDRA,AM - ! ! ! ! 24 24 24 24 , '!() '!() '!() '!() ! !! ! : CHALLENGING THE ORDER DATED 11.02.2013 OF THE CIT-( A)19,MUMBAI,ASSESSEE HAD RAISED FOLLOWING GROUND OF APPEAL: 1.THE CIT ERRED IN CONFIRMING THE ORDER OF ITO HOL DING THE AMOUNT RECEIVED OF RS 87, 50,000. 00 AS INCOME OF THE ASSESSEE 2.THE CIT ERRED IN HOLDING THE AMOUNT OF RS 87,50,0 00.00 AS INCOME UNDER THE HEADS OF OTHER SOURCES. 3.THE CIT ERRED IN THE HOLDING THAT THE AMOUNT OF R S 87,50,000.00 WAS WIND FILL AND TAXABLE AS INCOME. 4.THE CIT ERRED IS NOT APPRECIATING THE FACT THAT T HE ASSESSEE WAS ENTITLED TO BE COMPENSATED U/S.41 &43 OF THE BOMBAY TENANCY AND AGRICULTURAL LAND (VI DHARBHA REGION) ACT 1958 AS LAND LORD IN THE AGRICULTURAL LAND WHICH GOT TRANSFERRED BY THE OPER ATION OF LAW TO THE TENANT AND THE AMOUNT OF RS 87,50,000.00 AS CAPITAL GAIN 5.ANY OTHER GROUND THAT MAY BE TAKEN AT THE TIME OF HEARING. 2. ASSESSEE,AN INDIVIDUAL,FILED HIS RETURN OF INCOME ON 08/06/2009 DECLARING TOTAL INCOME AT RS.3, 69,420/-.ASSESSING OFFICER (AO) FINALISED THE ASSES SMENT ON DETERMINING HIS INCOME AT RS.91, 19,420/- U/S.143(3) OF THE ACT.DURING THE ASSESSMEN T PROCEEDINGS,AO FOUND THAT UNDER THE HEAD LONG TERM CAPITAL GAIN THE ASSESSEE HAD SHOWN LOSS OF RS. 41,99,458/-COMPUTED AS UNDER,ALTHOUGH CARRY FORWARD OF THE SAME TO THE SUBSEQUENT YEARS W AS NOT CLAIMED IN THE RETURN : FULL VALUE OF CONSIDERATION : RS, 6750080 LESS INDEXED COST OF ACQUISITION : RS. 50744580 RA. (-) 4199458. IN THE COMPUTATION OF INCOME HE HAD ADOPTED ACQUISI TION COST AT RS.87,19,000/- AS OF THE LAND. 2 ITA NO. 209/NAG/2013 RADHESHYAM M. KHETAN . AO FOUND THAT THREE PLOTS OF LAND WERE SOLD DURING THE YEAR UNDER APPEAL BY DOMODAR GOVINDRAO THAKRE TO NISHANT GIRISH GANDHI FOR A CONSIDERATION OF RS.4,38,50,000/-,THAT THE ASSESSEE WAS PAID RS.87.5 LAKHS AND HE HAD SIGNED THE DEED AS C ONSENTOR,THAT IN THE COPIES OF LAND RECORD; EXTRACTS KNOWN AS 7/12 UTARA ATTACHED WITH THE SA LE DEED;THAKRE WAS MENTIONED AS OWNER OF ALL THE THREE BLOCKS OF AGRICULTURAL LAND.AO DIRECTED T HE ASSESSEE TO FILE AN EXPLANATION AND VIDE HIS LETTER DATED 30.06.2011,ASSESSEE FILED HIS REPLY. REFERRING TO THE PROVISIONS OF SECTION 2(14) OF THE ACT,AO HELD THAT CAPITAL ASSET MEANT THE PROPERTY OF ANY KIND OWNED BY AN ASSESSEE WHETHER O R NOT CONNECTED WITH HIS BUSINESS OR PROFESSION.AO FURTHER FOUND THAT THE ASSESSEE WAS L ANDLORD OF THE PLOTS OF LAND AND THAKARE WAS THE TENANT,THAT AFTER PROMULGATION OF BOMBAY TENANC Y AND AGRICULTURAL LANDS(VIDARBHA REGION) ACT,1958(BTALA.)THE THEN ADDITIONAL TAHSILDAR, NAGP UR COMMENCED PROCEEDINGS U/S. 49(B) OF THE SAID ACT TO RESTORE THE POSSESSION OF THE LAND TO THE TENANT,THAT PROCEEDINGS WITH REGARD TO THE HANDING OVER THE POSSESSION OF THE LAND TO THAKARE WERE CONTESTED BY THE ASSESSEE IN THE COURT OF SUB DIVISIONAL OFFICER,NAGPUR,THAT ASSESSEE HAD FIL ED APPEAL BEFORE THE MAHARASHTRA REVENUE TRIBUNAL,THAT VIDE ITS ORDER DATED 28.09.1979 TRIBU NAL DECIDED THE ISSUE AGAINST THE ASSESSEE,THAT THE ASSESSEE DID NOT FIND ANY FAVOUR IN THE WRIT PE TITION FILED IN THE HONBLE HIGH COURT OF JUDICATURE AT BOMBAY, BENCH AT NAGPUR AND SPECIAL L EAVE PETITION FILED BEFORE THE HONBLE SUPREME COURT.AO RECORDED STATEMENT OF THE THAKARE U/S.131 OF THE ACT AND HE STATED THAT THE ASSESSEE DID NOT HAVE ANY RIGHT IN THE AGRICULTURAL LAND SOLD,THAT THE AMOUNT RECEIVED BY THE ASSESSEE,AS MENTIONED IN THE SALE DEED,WAS PURELY A S PER DESIRE OF THE PURCHASER AND IT HAD NOTHING TO DO WITH THE TRANSACTION IN QUESTION. ALL THESE FACTS WERE PUT BEFORE THE ASSESSEE,BY THE AO,VIDE NOTICES U/S.142 DATED 26.07.2011 AND 23.08.2011 FOR HIS RESPONSE.ASSESSEE,VIDE HIS WRITT EN REPLY DATED 20.09.2011,MADE FURTHER SUBMISSIONS.AFTER CONSIDERING THE REPLY OF THE ASSE SSEE,AO HELD THAT FACTS NARRATED BY THE ASSESSEE AT PARAGRAPHS NUMBERED. 1 TO 3 IN THE FIRS T REPLY WERE ARE NOT VERIFIABLE IN ABSENCE OF ANY MATERIAL BROUGHT ON RECORDS,THAT THE ASSESSES HAD F ORFEITED HIS RIGHTS IN THE LAND BY VIRTUE OF OPERATION THE LAW,THAT THE MONEY RECEIVED BY THE AS SESSEE IN THE INSTANT CASE WAS NOT THE PURCHASE PRICE PAID BY THE TENANT,THAT AS PER THE PROVISIONS OF BTALA THE TENANT WAS SUPPOSED TO PAY TO THE ASSESSEE COMPENSATION AS PER THE ORDER OF THE COMPETENT AUTHORITY,THAT THE WORD TENANT HAD BEEN DEFINED IN BTALA ,THAT THE SUMS RECEIVED BY TH E ASSESSEE WERE NOT THE PURCHASE PRICE PAID BY THE TENANT UNDER BTALA,THAT THE PURCHASER DID NO T CONFIRM IN HIS SUBMISSION;MADE ON 31.10.2011;THAT HE HAD PURCHASED LAND FROM THE ASSE SSEE ,THAT THE ASSESSEE DID NOT CONTRADICT THE FACT STATED BY THE PURCHASER WHILE FILING HIS REPLY ON 20.09.2011,THAT THE PURCHASER MERELY PERCEIVED SOME SORT OF RIGHT OF THE ASSESSEE IN THE PROPERTY AND PAID RS. 87.5 LAKSH TO THE ASSESSEE AS CONSENT MONEY,THAT IN THE MATTER UNDER APPEAL TH E MAHARASHTRA LAND TRIBUNAL DETERMINED THE PRICE WHICH THE TENANT COULD HAVE PAID TO THE ASSES SEE,THAT NEITHER THE TENANT NOR THE PURCHASER EVER CONCEDED THAT THE SUM PAID TO THE ASSESSEE WAS IN ORDER TO DISCHARGE THE OBLIGATION OF THE TENANT BY THE PURCHASER,THAT IT WAS ADMITTED BY THE ASSESSEE IN THE SECOND REPLY THAT THE PURCHASER PAID THE SUMS TO HIM TO ALLEVIATE ANY FUTURE COMPLI CATIONS AND TO MAKE THE PROPERTY FREE FROM ENCUMBRANCES,THAT SALE PRICE RECEIVABLE BY THE ASSE SSEE WAS OF RS 7200/- ONLY;AS IS APPARENT FROM THE ORDER OF THE SDO, NAGPUR;ON EXTINGUISHMENT OF R IGHT DUE TO OPERATION OF THE LAW AS PRESCRIBED BTALA,THAT IN VIEW OF THE SEC.53A OF THE TRANSFER OF PROPERTY ACT THE LAND UNDER CONSIDERA - TION WAS TRANSFERRED TO THE TENANT IN LIEU OF PRIC E OF RS.7200/-,THE AMOUNT OF RS.87,50,000/- RECEIVED BY THE ASSESSEE WAS NEITHER THE PURCHASE P RICE WITHIN THE MEANING OF SEC 47 OF BTALA NOR THE PRICE RECEIVED IN LIEU OF TRANSFER OF RIGHT ,THAT THE ASSESSEE DID NOT HAVE ANY RIGHT IN THE LA ND WHICH COULD BE TERMED AS CAPITAL ASSET,THAT HIS RIG HT IN THE LAND WAS ALREADY EXTINGUISHED ON EARLIER DATES,THAT ANY COMPENSATION (SETTLEMENT PRI CE OR COMPROMISE PRICE AS WORDED IN THIS CASE) COULD NOT BE SAID TO BE CAPITAL RECEIPT,THAT THE AS SESSEE HAD CARRIED ON PROLONGED LITIGATION WITH THE TENANT ON ONE OR OTHER ISSUE IN RESPECT OF THE AGRI CULTURAL LAND,THAT THE ASSESSEE RECEIVED THE PRICE OF RS. 8750000/- FOR HIS NUISANCE VALUE,THAT THE SUMS WERE PAID BY THE PURCHASER TO THE ASSESSEE ONLY TO SECURE HIS INVESTMENT OF RS.4,38,50,000/-FR OM ANY FUTURE LITIGATION WHICH IS COMMON 3 ITA NO. 209/NAG/2013 RADHESHYAM M. KHETAN . PRACTICE IN THE DAY TODAY LIFE,THAT THE ARGUMENT OF THE ASSESSEE THAT THE CAPITAL GAIN AROSE IN 1979 WAS DEVOID OF MERITS,THAT THE MONEY RECEIVED BY HIM WAS NOT THE PURCHASE PRICE PAID BY THE TENANT I.E.DAMODAR GOVINDRAO THAKRE,THAT AS PER THE PROVISIONS OF BTALA THE TENANT WAS SUPPOSED TO PAY MONEY TO THE ASSESSEE BY THE ORDER OF THE COMPETENT TRIBUNAL WHO HAD TO DETERMINE THE PURCHASE PRICE,THAT THE WORD TENANT H AD BEEN DEFINED IN BTALA AND A PURCHASER OF THE LAND FROM THE TENANT WAS NOT INCLUDED THEREIN ,THAT IN MATTER UNDER APPEAL THE TENANT WAS SUMMONED U/S.131 OF THE ACT,THAT THE TENANT SUBMITT ED BEFORE THE AO THAT THE AMOUNT RECEIVED BY SHRI KHETAN AS MENTIONED IN THE SALE DEED WAS PU RELY AS PER DESIRE OF THE PURCHASER AND THE ASSESSEE HAD NOTHING TO DO WITH THAT TRANSACTION,TH AT THE SUMS RECEIVED BY THE ASSESSEE WERE NOT THE PURCHASE PRICE PAID BY THE TENANT UNDER BTALA,T HAT THE PURCHASER OF THE LAND NISHANT GANDHI DID NOT CONFIRM IN HIS SUBMISSIONS;MADE BEFORE THE ASSESSING OFFICER ON 31.10.2011;THAT THE PRICE PAID BY HIM TO THE ASSESSEE WAS PURCHASE PRICE,THAT THE PURCHASER PAID THE SUM TO THE ASSESSEE TO AVOID FUTURE COMPLICATION AND TO MAKE THE PROPERTY FREE FROM ENCUMBRANCES,THAT NOWHERE EITHER THE PURCHASER OR THE TENANT OR THE ASSESSEE HAD STA TED THAT THE AMOUNT OF RS.87,50,000/-RECEIVED BY HIM WAS TOWARDS THE SALE OF PROPERTY,THAT THE CONSI DERATION WAS RECEIVED BY THE ASSESSEE IN THE YEAR UNDER CONSIDERATION,THAT THE TAXABILITY ALSO A ROSE IN THAT YEAR AND NOT IN PAST YEAR AS CLAIMED BY THE ASSESSEE. FINALLY,HE HELD THAT THE ASSESSEE DID NOT HOLD ANY PROPERTY WHICH COULD BE TREATED AS CAPITAL ASSET, THAT MONEY RECEIVED BY HIM COULD NOT BE ASSESSED UN DER THE HEAD CAPITAL GAIN,THAT THE RECEIPT WAS OF CASUAL AND NON- RECURRING NATURE AND,THEREFORE,T AXABLE UNDER THE HEAD INCOME FROM OTHER SOURCES. 3. ASSESSEE PREFERRED AN APPEAL BEFORE THE FIRST APPEL LATE AUTHORITY(FAA).AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND THE ASSESSMENT ORDE R HELD THAT AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND THE ASSESSMENT ORDER,FAA HELD T HAT THE AGREEMENT OF SALE FOR LAND IN QUESTION WAS BETWEEN DAMODAR GOVIND THAKRE AND NISHANT GIRI SH GANDHI,THAT THE CONSIDERATION FOR SALE AMOUNTING TO RS.4,38 , 50,000/- WAS RECEIVED BY SHRI DAMODAR THAKRE,THAT T HAKERE WAS TENANT OF THE LAND,THAT THE MAHARASHTRA LAND REVENUE TRIBUNAL (MLRT); RELYING ON THE BOMBAY TENANCY AND AGRICULTURAL LANDS (VIDARBH REGION) ACT OF 1958 (BTALA);VIDE ITS ORDER DT.28.09.1979 HAD DECLARED THAKRE ABSOLUTE OWNER OF THE LAND, THAT ON SALE OF LAND IN QUESTION THE ASSESSEE RECEIVED RS 87,50,000/- AS SOME SORT OF CONSENT TO SALE,THAT ONCE THE TENANT WAS PUT INTO POSSESSION THE ASSESSEE HAD OBJECTED TO THE RELEVANT ENTRIES MADE IN THE REVENUE RECORD,THAT THE ASSESSEE HAD FILED PETITION BEFORE THE TAHASILDAR AGAINST IN THE REVEN UE RECORDS,THAT ON APPEAL BY THE TENANT THE PETITION OF THE ASSESSEE WAS REJECTED BY SDO, THAT THE ASSESSEE THEREAFTER FILED REVISION PETITION BEFORE MAHARASHTRA LAND TRIBUNAL AGAINST THE ORDER OF SDO,THAT THE REVISION PETITION WAS WITHDRAWN ON 08.07.2008,THAT THE ASSESSEE HAD APPRO ACHED THE HONBLE HIGH COURT BUT MATTER WAS DECIDED AGAINST HIM,THAT HONBLE APEX COURT DI SMISSED SLP FILED BY THE ASSESSEE ,THAT ASSESSEE WAS NEITHER THE OWNER NOR HE HAD ANY INTER EST IN THE LAND,THAT THE AMOUNT RECEIVED BY HIM WAS NOT TOWARDS THE SALE PRICE BUT THE SELLER HAD P AID THE AMOUNT TO FACILITATE HIS PURCHASE AND TO MAKE IT FREE THE FROM ANY ENCUMBRANCES OR LITIGATIO N THAT COULD ARISE IN FUTURE, THAT THE AMOUNT IN QUESTION WAS RIGHTLY TAXED UNDER THE HEAD INCOME F ROM OTHER SOURCES BY THE AO, THAT MONEY RECIEVED BY THE ASSESSEE WAS OF CASUAL AND NON RECU RRING NATURE,THAT THE DECISION RELIED UPON BY THE ASSESSEE WERE RENDERED ON THE FACTS OF THOSE CA SES,THAT THE ASSESSEE DID NOT DEMONSTRATE AS TO HOW SAID DECISIONS WERE APPLICABLE TO THE FACTS AND CIRCUMSTANCE OF THE CASE UNDER CONSIDERATION, THAT RELIANCE ON THOSE DECISIONS PLACED BY THE AR W AS TOTALLY MISPLACED.SHE RELIED UPON THE DECISION OF THE VINOD V. CHHAPIA DELIVERED BY TH H ONBLE MUMBAL TRIBUNAL WHERE IT WAS HELD THAT CONSIDERATION FOR CONSENT TO TRANSFER TENANCY WAS TO BE TREATED AS OTHER INCOME. FINALLY,DISMISSING THE APPEAL OF THE ASSESSEE,SHE H ELD THAT THE MONEY RECEIVED BY THE ASSESSEE WAS TO BE TAXED UNDER THE HEAD INCOME FROM OTHER SOURCE S AND NOT UNDER THE HEAD CAPITAL GAINS,AS HE WAS NOT THE OWNER OF THE LAND. 4 ITA NO. 209/NAG/2013 RADHESHYAM M. KHETAN . 4. BEFORE US,AUTHORISED REPRESENTATIVE(AR) SUBMITTED T HAT ASSESSEE HAD INTEREST IN THE PLOTS OF LAND,THAT MONEY RECEIVED BY HIM WAS PURCHASE PRICE PAID BY THE SELLER ON BEHALF OF THAKARE,THAT CAPITAL GAINS AROSE TO THE ASSESSEE IN 1979,THAT RI GHT OF THE ASSESSEE TO RECEIVE MONEY FROM THE TENANT WAS AS PER THE PROVISIONS OF THE BTALA,THAT SALE DEED COULD NOT AFFECT RIGHTS OF THE ASSESSEE,THAT COMPENSATION WAS RECEIVED BY THE ASSE SSEE IN FORM OF RS. 87.5 LAKHS AND SAME WAS RELATABLE TO YEAR 1976-77,THAT THE ASSESSEE RECEIVE D THE MONEY ON ACCOUNT OF EXTINGUISHMENT OF RIGHT,THAT THE RIGHT OF THE ASSESSEE WAS INTACT AS A LESSOR.HE REFERRED TO THE SECTION 49A OF THE BTALA IN HIS SUPPORT.DEPARTMENTAL REPRESENTATIVE(DR ) SUPPORTED THE ORDER OF THE FAA. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL BEFORE US.UNDISPUTED FACTS OF THE MATTER UNDER APPEAL ARE THAT THE ASSESSEE WAS OWNER OF THE AGRICULTURAL LAND TILL BTALA CAME IN TO OPERATION FROM 30.12.1958,THAT THE ACT WAS MADE APPLICABLE FROM 20.08.1958,THAT THAKARE WAS THE TENANT OF THE LAND AT THAT POINT OF TIME,THAT N ISHANT GIRISH GANDHI HAD PURCHASED THE LAND FROM THAKARE,THAT A SUM OF RS.87.5 LAKHS WAS PAID TO THE ASSESSEE WHO HAD SIGNED THE SALE DEED AS CONSENTOR,THAT HE CLAIMED THAT MONEY RECEIVED BY HI M WAS TO BE TAXED AS CAPITAL GAINS,THAT AO HELD THAT THE SUM RECEIVED THE ASSESSEE WAS TO BE T AXED UNDER THE HEAD INCOME FROM OTHER SOURCES FOR THE YEAR UNDER CONSIDERATION. BEFORE PROCEEDING FURTHER WE WOULD LIKE TO DISCUSS THE HISTORY AND PROVISIONS OF BTALA.IT IS A KNOWN FACT THAT ALL THE STATE GOVERNMENTS OF UNION OF INDIA INITIATED LAND REFORMS AFTER NATION BECAME INDEPENDENT IN 1947.THE AIM BEHIND THE REFOR MS WAS TO ABOLISH THE ABSENTEE LAND LORD SYSTEM AND MAKE THE TENANTS-THE ACTUAL CULTIVATORS OF LAND-THE OWNER OF THE AGRICULTURAL LAND. STATE GOVERNMENTS PASSED LEGISLATIONS AND THE PERSONS CAR RYING OUT ACTUAL AGRICULTURAL ACTIVITIES WERE MADE THE OWNERS OF THE FIELDS THAT THEY WERE PLOUGH ING.BTALA,INTRODUCED BY THE GOVERNMENT OF MAHARASHTRA WAS ONE OF SUCH LEGISLATURES-IT WAS MAD E EFFECTIVE FROM AUGUST, 1958.AS PER THE PROVISIONS OF THE ACT,PERSONS WHO WERE CULTIVATING AGRICULTURE LAND ON 20.08.58 COULD PURCHASE LAND FROM THE OWNER OF THE LAND BY PAYING AN AMOUNT FIXED BY STATE REVENUE AUTHORITIES.SECTIONS 41,43,45,47,49A,49B,51 DEAL WITH THE PURCHASE OF LA ND BY TENANT,PAYMENT OF PURCHASE PRICE BY THE TENANT.AFTER PERSUING THE SECTIONS OF THE BTALA WE ARE OF THE OPINION THAT THE ASSESSEE DID NOT HAVE ANY RIGHT IN THE SAID PROPERTY,THAT THE PR OPERTY WAS TRANSFERRED TO THE TENANT BY OPERATION OF LAW,THERE WAS NO LEASE AGREEMENT BETWEEN THE ASS ESSEE AND THE TENANT,THAT U/S.41 OF BTALA IT WAS RIGHT OF THE TENANT TO PURCHASE THE LAND FROM T HE LANDLORD, THAT THE RIGHT OF THE TENANT WAS ALSO NOT TRANSFERABLE UNDER THE PROVISIONS OF BTALA, THA T BY VIRTUE OF THE PROVISIONS OF SEC.43 OF BTALA THE ASSESSEE WAS ENTITLED TO GET ONLY THAT MU CH AMOUNT FROM THE TENANT AS DETERMINED BY THE COMPETENT TRIBUNAL,THAT THE OWNERSHIP OF THE LA ND WAS COMPULSORILY TRANSFERRED TO THE TENANT AND THE ASSESSEE WAS ENTITLED TO A FIXED SUM AS PRI CE THEREOF COMPUTED AS PRESCRIBED IN SEC.47 OF BTALA,THAT NOWHERE IN THE PROVISIONS OF SECTIONS 51 TO 57 OF BTALA UNDER THE HEADING OTHER RIGHTS AND LIABILITIES OF TENANTS AND LANDLORDS,IT WAS SPECIFIED THAT THE ASSESSEE AS LANDLORD WOULD HAVE RIGHT TO RECEIVE THE PURCHASE PRICE FRO M THE SUCCESSOR OF THE TENANT STEPPING IN HIS (TENANTS) SHOES BY WAY OF SALE DEED,THAT AS PER SE C. 91 OF BTALA IF THE LANDLORD INTENDED TO SELL THE LAND LEASED TO TENANT,HE WAS SUPPOSED TO APPLY TO THE TRIBUNAL FOR DETERMINING THE REASONABLE PRICE THEREOF AND MAKE OFFER TO THE TENANT FOR PURC HASE AT THAT PRICE. IT IS APPARENT FROM ALL THESE PROVISIONS,THAT THE ASSESSEE WAS ENTITLED TO PURCHA SE PRICE, AS DETERMINED BY THE TRIBUNAL, FROM THE TENANT ONLY. 5.A. WE FIND THAT IN THE MATTE UNDER APPEAL A LOT OF LIT IGATION TOOK PLACE BETWEEN THE ASSESSEE AND THAKARE. WHEN THE MATTER REACHED THE MLRT,THE LAST FACT FINDING AUTHORITY,IT HELD AS UNDER: COMPARED TO THIS THE EVIDENCE LED BY THE N.A.TENAN T IS OF WEALTHY NATURE AND IS OF INTRINSIC EVIDENTIAL VALUE.IT IS VOLUMINOUS.THERE ARE CROP ST ATEMENT ENTRIES FOR 1957-58 AND 1958-59,ENTRY IN RECORD OF RIGHTS.ALL THESE DOCUMENTS UNMISTAKAB LY AND WITHOUT LEAST AMBIGUITY LATENT OR PATENT SPEAKS OF POSSESSION OF GOVINDA AS TENANT FO R THE RELEVANT PERIOD.THE OBSERVATION OF THE HIGH COURT METICULOUSLY SPEAK THAT GOVINDA CULTIVAT ED THE LAND IN THE YEAR 1958-59 AND WAS IN POSSESSION OF IT AT THE MATERIAL TIME.HIS LORDSHIP JUSTICE WAGHALE ALSO OBSERVED THAT THE WITNESS 5 ITA NO. 209/NAG/2013 RADHESHYAM M. KHETAN . OF THE L.L.-PATWARI VISHWASRAO WHO WAS THEN ON DUTY OF PREPARING THE CROP STATEMENT STATED THAT GOVINDA WAS IN POSSESSION OF THE LAND IN 1958-59 AN D THAT THE TENANTS LIST PREPARED BY HIM UNDER SECTION 8(2)OF THE TENANCY ACT IS VERIFIED BY REVEN UE INSPECTOR CONCERNED.IT IS ALSO OBSERVED BY HIS LORDSHIP THAT IS A FINDING OF THE APPELLATE COU RT (CRIMINAL)THAT GOVINDA WAS IN POSSESSION LAWFULLY ON THE DATE OF INCIDENT BUT HELD THAT THE RIGHT PRIVATE DEFENCE WAS EXCEEDED WOULD STILL FORTIFY THE CASE OF GOVINDA THAT HE WAS IN POSSESS ION ON THE DATE OF INCIDENT WHICH IS 10.06. 1959THERE IS ALREADY A GREAT WEALTH OF DOCUMENTAR Y EVIDENCE ,AS STATED ABOVE BY ME-ON RECORD WHICH REMAINS UNREBUTTED BY THE LAND LORD AN D ONE CAN SAFELY INFER IN FAVOUR OF THE NON APPLICANT. (PG.16-18 OF PAPER BOOK). ASSESSEE,FILED A WRIT PETITION,AS STATED EARLIER,BE FORE THE HONBLE HIGH COURT AND FOLLOWING QUESTION WAS FRAMED BY THE COURT: THE SOLE QUESTION WHICH ARISES FOR DETERMINATION I N THIS CASE IS WHETHER THE RESPONDENT WAS A TENANT DURING 1958-59 OR PRECISELY ON THE APPOINTED DATE I.E.ON 20.08.58.WHICH IS ESSENTIAL A QUESTION OF FACT. AFTER CONSIDERING THE RIVAL SUBMISSIONS HONBLE COU RT HELD AS UNDER: THE LEARNED COURTS BELOW HAVE NOT ACCEPTED THE VERS ION OF THE LANDLORD THAT THE RESPONDENT WAS NOT THE TENANT..THERE IS,THEREFORE,NO MERIT IN T HE CONTENTIONS RAISED ON BEHALF OF THE LANDLORD THAT THE RESPONDENT WAS NOT THE TENANT OF THE SUIT FILED DURING 1958-59 AND IN PARTICULAR ON THE APPOINTED DAY I.E.ON 20.8.58. IN THE RESULT THE WRIT PETITION FILED BY FAILS AND IS DISMISSED. (PB19-22 OF PB). FROM THE ABOVE IT IS CLEAR THAT THE ASSESSEE WAS NO T THE OWNER OF LAND IN AUGUST 1958,THAT BY OPERATION OF LAW TENANT THAKARE HAD BECOME THE OWNE R OF THE PROPERTY IN QUESTION.IF THE ASSESSEE HAD TO RECEIVE ANY COMPENSATION IT WAS FROM THAKARE ,THAT AS PER THE PROVISIONS OF THE BLATA HE WAS ENTITLED TO RECEIVE RS.7,200/-AS DISCUSSED BY T HE AO.HE HAD NO RIGHT TO RECEIVE ANY MONEY FROM THE PURCHASER OF THE PROPERTY IN THE YEAR UNDE R APPEAL.AS THE AGRICULTURAL LAND BELONGED TO THAKARE,THE CLAIM MADE BY THE ASSESSEE THAT THE SUM RECEIVED BY HIM SHOULD BE TREATED AS CAPITAL GAINS CANNOT BE ENDORSED.HE HAD LOST THE TITLE OF T HE LAND WAY BACK IN 1958 AND FOR RESTORING IT BACK FOUGHT A LONG LEGAL BATTLE. BUT,COURTS,INCLUDI NG THE HONBLE HIGH COURT,HELD THAT THAKARE WAS TENANT OF THE LAND ON 20.08.1958,THEREFORE WE HAVE NO HESITATION IN HOLDING THAT SUM RECEIVED BY THE ASSESSEE FROM NISHANT GANDHI HAS TO BE TAXED AS INCOME FROM OTHER SOURCES.WE HAVE TO TAKE NOTE OF THE NOTORIOUS FACT THAT PURCHASER OF A PROP ERTY DOES NOT WANT ANY TROUBLE FROM ANY PERSON AND IF HE APPREHENDS THAT A PERSON CAN CREATE PROBL EM IN FUTURE;EVEN IF HE DOES NOT HAVE LEGAL TITLE OVER A PROPERTY;HE HAS TO PAY SOMETHING TO SUCH PER SON WHO IS POTENTIAL LITIGANT. IN THE CASE UNDER CONSIDERATION IT IS CLEAR THAT LITIGATION BETWEEN T HE ASSESSEE AND THAKARE WAS BEFORE THE CRIMINAL COURTS AS WELL AS REVENUE COURTS AND IT TRAVELLED U P TO HONBLE SUPREME COURT.IF CONSIDERING THE HISTORY;ASSOCIATED WITH THE AGRICULTURAL LAND IN QU ESTION;NISHANT GANDHI FOUND IT PRUDENT TO PAY SOMETHING TO THE ASSESSEE,IT WOULD NOT AND COULD NO T BE TERMED INCOME ARISING OUT OF CAPITAL GAINS.FOR CLAIMING A SUM CAPITAL GAINS FIRST OF ALL THE ASSESSEE SHOULD BE OWNER OF THE CAPITAL ASSET. IN THE CASE UNDER APPEAL ASSESSEE HAS FAILED TO PRO VE THAT THE LAND BELONGED TO HIM.THEREFORE,WE ARE CONFIRMING THE ORDER OF THE FAA AND DECIDEING T HE EFFECTIVE GROUND OF APPEAL AGAINST THE ASSESSEE. AS A RESULT,APPEAL FILED BY THE ASSESSEE STANDS DISMISSED. 5 /6 #5/ 7 2 8 '9 ' / ;. ORDER PRONOUNCED IN THE OPEN COURT ON 03 RD FEBRUARY, 2014. 2!3 1* ! ( 3 QJ QJQJ QJ 0 , 2014 . SD/- SD/- (H.L.KARWA/ % %% % . . ) ( '!() '!() '!() '!() / RAJENDRA) PRESIDENT/ '& ! ! ! ! 24 24 24 24 /ACCOUNTANT MEMBER 6 ITA NO. 209/NAG/2013 RADHESHYAM M. KHETAN . / MUMBAI, 2 /DATE: 03.02.2014 SK 2!3 2!3 2!3 2!3 -/ -/ -/ -/ =!*/ =!*/ =!*/ =!*/ / COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE / +, 2. RESPONDENT / -.+, 3. THE CONCERNED CIT(A)/ > ? , 4. THE CONCERNED CIT / > ? 5. DR ITAT,NAGPUR BENCH/ @ -/ , . . ( . - . 6. GUARD FILE/ # A . . / -/ //TRUE COPY// 2!3 / BY ORDER, B / ' DY./ASST. REGISTRAR , /ITAT, MUMBAI.