HEMANT RANJIT KHATAU, MUMBAI V. ITO WD 18(1)(5), MUMBAI

ITA 6899/MUM/2016

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 9503 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 3 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-03-2020
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: H
• Assessment Year: 2012-2013
• Appeal Filed On: 24-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KAMAL MANGAL
• Assessee Lawyers: NITESH S JOSH I
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Charitable institution; Opportunity of being heard; Capital receipt; Surrender of tenancy right; Capital Gains
• Section: 50C; 56(2); 201; 54EC; 64; 13

Judgement Text

T HE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI BEFORE SHRI SHAMIM YAHYA ( A M) & SHRI PAWAN SINGH (JM) I.T.A. NO. 6899 /MUM/ 201 6 (ASSESSMENT YEAR 20 12 - 1 3 ) SHRI H EMANT RANJIT KHATAU 465, CHANDRA CHOWK LANE M.J. MARKET MUMBAI - 400 002. PAN : AADPK679 4L V S . ITO WARD 18(1)(5) 2 ND FLOOR EARNEST HOUSE NARIMAN POINT MUMBAI - 400 020. ( APPELLANT ) ( RESPONDENT ) ASSESSEE BY SHRI NITESH S. JOSHI DEPARTMENT BY SHRI KAMAL MANGAL DATE OF HEARING 17.01.2020 DATE OF PRONOUNCEMENT 17 . 03 . 20 20 O R D E R PER SHAMIM YAHYA (AM) : - THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A) DATED 22.8.2016 AND PERTAINS TO A.Y. 2012 - 13. 2. GROUNDS OF APPEAL READ AS UNDER : - 1. THE CIT (A) ERRED IN TREATING THE INCOME ARISING ON C REATION OF TENANCY RIGHTS AS CHARGEABLE TO TAX UNDER THE HEAD INCOME FROM OTHER SOURCES' AND THEREBY DENYING THE APPELLANT'S CLAIM FOR EXEMPTION UNDER SECTION 54EC OF THE ACT AND CHARGING THE BALANCE GAINS TO TAX AT THE RATE OF 30 % INSTEAD OF 20%. 2. THE CIT (A) FAILED TO APPRECIATE THAT WHEN THE APPELLANT AND OTHER CO - OWNERS GOT A SURRENDER OF TENANCY RIGHTS IN OCTOBER 1993 THEY BECAME COMPLETE OWNER OF THE PROPERTY AND THIS TRANSACTION COULD NOT BE REGARDED AS ACQUISITION OF TENANCY RIGHTS BY THE OTHER CO - OWNERS. 3. THE CIT (A) FAILED TO APPRECIATE THAT, IN THE PRESENT CASE, THE APPELLANT ALONG WITH THE OTHER CO - OWNERS HAD CREATED NEW TENANCY RIGHTS IN THE PROPERTY BEING BLOCK NO 5, PAID STAMP DUTY ACCORDINGLY FOR CREATION OF TENANCY UNDER ARTICLE 36 O F THE BOMBAY STAMP ACT AND IT WAS A NOT A CASE WHERE THE APPELLANT HAD CONSENTED TO THE TRANSFER OF TENANCY RIGHTS BY OTHER CO - OWNERS. 3. BRIEF FACTS OF THE CASE ARE AS UNDER : - SHRI HEMANT RANJIT KHATAU 2 THE ASSESSEE ALONGWITH 8 CO - OWNERS ARE OWNER OF A BUILDING KNOWN AS KHATAU MA NSION SITUATED AT MAHALAXMI, MUMBAI. THE BUILDING WAS - INHERITED BY THEM. THE BLOCK NO. 5 WHICH IS A PART OF THE BUILDING WAS IN POSSESSION OF A TENANT TILL 1993. HE WITHDREW THE TENANCY RIGHTS IN FAVOUR OF THE OWNERS IN 1993. IN DECEMBER, 2011, IT WAS LET OUT UNDER A NEW TENANCY AGREEMENT DATED 30.12.2011. THE PROPERTY WAS TENANTED TO DAWAT - E - HADIYAH TR U ST WHICH IS A PUBLIC CHARITABLE TRUST AND THE TENANCY RIGHTS WERE SOLD FOR A SUM OF RS.14 CRORES. THE AMOUNT OF COMPENSATION EACH CO - OWNER WAS PAID BY SEPA RATE CHEQUES BY THE TENANT DAWAT - E - HADIYAH TRUST. THE ASSESSEE 'S SHARE IN THE SAID PROPERTY IS 25% WHEREAS HE HAD RECEIVED CONSIDERATION WHICH WORKED OUT TO ONLY 8.33% OF THE TOTAL SUM RECEIVED. UPON ENQUIRY BY THE ASSESSING OFFICER T HE REASON FOR THIS HAS BEEN GIVEN AS UNDER : - THE 8 CO - OWNERS OTHER THAN THE APPELLANT HAVE PAID RS.60 LAKHS TO GET THE PROPERTY VACATED BY THE PREVIOUS TENANT IN 1993. SINCE THE APPELLANT HAS NOT CONTRIBUTED ANYTHING, IT WAS AGREED BY ALL THE PARTIES THAT WHEN THE FLAT WAS G IVEN ON RENT, 2/3 RD OF THE SHARE WILL BE TAKEN BY 8 CO - OWNERS WHO MADE THIS PAYMENT OF RS. 6 0 LAKHS AND THE REMAINING 1/3 RD WILL BE SHARED BY ALL THE 9 CO - OWNERS IN THE RATIO OF THEIR SHARES. ACCORDINGLY, THE APPELLANT HAS RECEIVED 25% 1/3 RD SHARE OF RS.14 CRORES WHICH ULTIMATELY WORKED OUT TO 8.33% OF THE TOTAL CONSIDERATION. T HE OTHER CO - OWNERS HAVE FILED THE RETURNS DECLARING THEIR RESPECTIVE SHARE S OF INCOME WHICH HAS BEEN ACCEPTED BY THE DEPARTMENT. 4. DURING THE COU RSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER OPINED THAT THE AMOUNT OF RS. L,16,66,000/ - RECEIVED BY THE ASSESSEE HAS TO BE TAXED AS INCOME FROM OTHER SOURCES AND NOT AS INCOME FROM CAPITAL GAINS. HE HAD RELIED UPON THE JUDGMENT OF HON'BLE ITAT, MUMBAI IN THE CASE OF VINOD V. CHH APIA VS. ITO (31 TAXMANN.COM 415) AND HAD ISSUED A SHOW CAUSE TO THE ASSESSEE. I N T H E REPLY , IT WAS SUBMITTED THAT THE AMOUNT RECEIVED BY THE ASSESSEE IS A CAPITAL RECEIPT RECEIVED ON CREATING OF TENANCY RIGHTS. TH AT TH E TENANCY RIGHT IS A CAPITAL ASSET A ND THE AMOUNT RECEIVED IS A CAPITAL RECEIPT . THAT WHAT THE APPELLANT RECEIVED IS A ONETIME PREMIUM FOR RENTING OUT THE PROPERTY. THE ASSESSEE ALSO FILED A LETTER THE 8 CO - OWNERS WHERE THEY HAVE CONFIRMED THAT EVEN THOUGH THE ASSESSEES SHARE IS 25%, WHAT H E RECEIVED WAS ONLY 8.33%. THEY HAVE ALSO MENTIONED IN THE LETTER DATED 10.3.2015 THAT SHRI HEMANT RANJIT KHATAU 3 'NORMALLY IN CASE OF TENANTED PREMISES PROCEEDS OF CONSIDERATION ARE DIVIDED BETWEEN THE TENANTS/OCCUPANTS AND THE LANDLORD IN THE RATIO OF 2/3 RD AND 1/3 RD RESPECTIVELY. THUS 2/3 RD PREMIUM AMOUNT RECEIVED WOULD BELONG TO US I.E. EIGHT CO - OWNERS/TENANTS, WHO WERE OCCUPANTS OF BLOCK NO.5 BY VIRTUE OF HAVING PAID FOR VACATING THE TENANT IN THE YEAR 1993 AND THE BALANCE 1/3 RD BELONG TO AL THE NINE CO - OWNERS AS LANDLORDS OF TH E BUILDING.' THE AO HELD THAT IN THIS CASE, TENANCY RIGHTS WERE NOT SURRENDERED BY TENANTS IN FAVOUR OF THE LANDLORD BUT WAS TRANSFERRED TO THE NEW TENANTS AND THE AMOUNTS WHICH WERE RECEIVED BY 9 PERSONS IS RECEIVED FOR GIVING CONSENT TO TRANSFER THE TENA NCY RIGHTS AND PROPOSED TO TREAT THE RECEIPT AS INCOME FROM OTHER SOURCES. THE LD. COUNSEL FOR THE ASSESSEE REPLIED THAT FLAT WAS VACANT SINCE 1993 AND THEREFORE THE QUESTION OF VACATING THE SAID FLAT DOES NOT ARISE. THE ASSESSEE ALSO SUBMITTED THAT THE FA CTS OF THE CASE OF SHRI VINOD V. CHHAPIA ARE NOT COMPARABLE TO THE FACTS OF THE PRESENT CASE. IN THE CASE OF VINOD V. CHHAPIA, THERE IS NO TIME GAP BETWEEN THE VACATION OF THE PROPERTY BY THE OLD TENANTS AND GRANT OF TENANCY RIGHTS TO THE NEW TENANTS. BUT IN THE PRESENT CASE, THE PROPERTY WAS LYING VACANT SINCE OCTOBER, 1993. THAT T HERE WAS A TRIPARTITE AGREEMENT IN THE CASE OF VINOD CHHAPIA AMONG THE OLD TENANTS, NEW TE NANTS AND THE LANDLORDS WHEREAS IN THIS CASE, IT IS ONLY THE BY PARTITE AGREEMENT BETWE EN THE CO - OWNERS AND THE TENANTS. 5. HOWEVER, THE SUBMISSIONS OF THE LEARNED COUNSEL DID NOT FIND FAVOUR WITH THE AO. ACCORDING TO THE AO, THERE IS NO TIME GAP BETWEEN THE VACATION OF THE P ROPERTY BY THE OLD TENANTS AND THE GRANT OF TENANCY RIGHTS TO TH E NE W TENANTS I.E. OTHER CO - OWNERS. THE CO - OWNERS HAVE ALSO SUBMITTED THAT THEY HAVE FILED THE RETURNS IN THE NAME OF KISHORE KHATAU AND OTHERS AS AOP AND DECLARED HOUSE PROPERTY INCOME. THE HOUSE WAS NOT IN A VACANT POSSESSION O F THE AS S ESS E E BUT WAS IN T HE POSSESSION OF OTHER 8 CO - OWNERS IN THEIR CAPACITY AS TENANTS AND HAS BEEN TRANSFERRED TO THE NEW TENANT DAWAT - E - HADIYAH T RUST M DEC., 2011. THE AO FURTHER REF ERRED TO SECTION 56(2) OF THE I. T.ACT AND HELD THAT THE RECEIPT WILL BE TAXABLE AS INCOME FROM OTHER SOURCES U/S.56(2). SHRI HEMANT RANJIT KHATAU 4 6 . AGAINST THE ABOVE ASSESSEE IS IN APPEAL BEFORE LEARNED CIT(A). LEARNED CIT(A) ELABORATELY CONSIDERED THE SUBMISSIONS OF THE ASSESSEE. AS REGARDS THE APPLICABILITY OF SECTION 56(2) LEARNED CIT(A) HELD THAT TENANCY RIGHTS ARE NOT COVERED THEREIN. THERE AFTER HE CONSIDERED OTHER ASPECTS AND HELD THAT THE SUM OF RS. 1,16,66,000/ - RECEIVED BY THE ASSESSEE IS INCOME FROM OTHER SOURCES . HE HELD AS UNDER : - THE SUBMISSIONS OF THE LEARNED CO UNSEL FOR THE APPE L LANT HAVE B EEN CONSIDERED CAREFULLY. APPARENTLY, THE PROPERTY B L O C K NO.5 , IN KHATAU MANSION WAS IN THE OCCUPATION OF TENANTS TIL L OCT., 1993. THE TENANTS WERE MADE TO VACATE BY PAYING THEM RS . 6 0 LAKHS. THIS 60 LAKHS WAS CONTRIBUTED BY THE 8 CO - OWNERS OTHER THAN THE APPELLANT. FROM THAT TIME ONWARDS, THE PROPERTY WAS IN P OSSESSION OF THE CO - OWNERS AND NOT THE APPELLANT. THE CO - OWNERS IN THEIR LETTER DATED 10.3.2015 STATED AS UNDER : - THE SAID TENANTED PREMISES BEING BLOCK NO. 5 OF KHATAU MANSION WAS THEREFORE IN POSSESSION OF 8 CO - OWNERS (SIN CE 1993 ) EXC L UDING MR. H EMANT TILL THE SAME WAS THEN L ET OUT IN DEC, 2011 L ET ON MONTHLY TENANCY BASIS TO M/S. DAWAT - E.HADIYAH TRUST AT CONSIDERATION BY WAY OF ONE TIME PREMIUM OF RS.14,00,00,000/ - FOR CREATION OF TENANCY IN THEIR FAVOUR. NORMA LLY IN CASE OF TENANTED PREMISES PROCEEDS OF CONSIDERATION ARE DIVIDED BETWEEN THE TENANTS/OCCUPANTS AND THE LANDLORD IN THE RATIO OF 2/3 RD AND L/3 RD RESPECTIVELY. THUS 2/3 RD PREMIUM AMOUNT RECEIVED WOULD TO US I.E. EIGHT CO - OWNERS/TENANTS, WHO WERE OCCUPA NTS OF BLOCK VIRTUE OF HAVING PAID FOR VACATING THE TENANT IN THE YEAR 1993 AND, THE BALANCE 1/3 RD BELONG TO A LL THE NINE CO - OWNERS AS LANDLORDS OF THE BUILDING. HENCE, AS LANDLORD'S SHARE, HEMANT RANJIT KHATAU IS ENTITLED TO 25% SHARE OF 1/3 RD SHARE OF 'O WNERS' WHICH COMES TO 8.33% OF THE TOTAL CONSIDERATION. THUS HE HAS RECEIVED ONLY 8.33% AS AGREEMENT DULY EXECUTED AND REGISTERED AND BALANCE AMOUNT RECEIVED BY THE OTHER EIGHT CO - OWNERS/TENANT AS STATED IN THE DULY EXECUTED AND REGISTERED. ACCORDINGLY, MR. HEMANT HAS IN HIS RETURN OF INCOME DISCLOSED 8.33% AS HIS SHARE AS RECEIVED BY HIM UNDER THE AGREEMENT OUT OF TOTAL CONSIDERATION OF RS. 14 CRORES. SIMILARLY ALL OTHER CO - OWNERS HAVE DECLARED THEIR INDIVIDUAL SHARES AGGREGATING TO BALANCE 9 1 .67%( 100 - 8 .33) AS RECEIVED BY THEM RESPECTIVELY UNDER THE AGREEMENT AS CO - OWNERS AND TENANTS IN THEIR RETURN OF INCOME AND THEY HAVE PAID THE TAXES ON THEIR SHARES ACCORDINGLY THEREON. THE PAN S OF ALL THE CO - OWNERS ARE ALREADY ON YOUR RECORDS.' 3.3.1. IT IS VERY CL EAR FROM THEIR STATEMENT THAT THEY HAVE CONSIDERED THEMSELVES AS CO - OWNERS AND TENANTS . I N THEIR CAPACITY AS TENANTS, THEY HAVE RECEIVED 2/3 RD OF THE TOTAL CONSI DERATION . IN THEIR CAPACITY AS CO - OWNERS, THEY RECEIVED THEIR SHARE OF THE 1/3 RD OF THE CONSIDE RATION. THEY HAVE ACTED IN A DUAL CAPACITY AS CO - OWNERS AND TENANTS WHEREAS; THE APPELLANT WAS JUS T THE CO - OWNER . IT IS ALSO MENTIONED BY THEM THAT THEY HAVE FILED THEIR RETURN OF SHRI HEMANT RANJIT KHATAU 5 INCOME IN THE NAME OF KRISHNA KHATAU AND OTHERS' DECLARING INCOME UNDER THE HEAD HOUSE PROPERTY. THEREFORE THE CASE OF VINOD V. CHHAPIA REFERRED TO SUPRA IS SQUA RELY APPLICABLE TO THE FACTS OF THE PRESENT CASE. IN THIS CASE, THERE IS NO TIM E GAP BETWEEN THE OLD TENANT AND THE NEW TENANT. ONE TENANT VACATED IN OCT, 93 AND THE PROP ERTY CAME IN POSSESSION OF THE NEW TENANT S WHO ARE THE 8 CO - OWNERS. IN DEC., 2011, THE 8 CO - OWNERS VACATED THE PROPERTY IN FAVOUR OF THE NEW TENANT, M/S. DAWAT - E HADIYAH TRUST. DAWAT - E - HADIYA H TRUST HAS PAID THE PRE MIUM OF 14 CRORES WHICH HAS BEEN SHARED B Y THE APPELLANT AS A CO - OWNER AND THE OTHER 8 CO - OWNERS IN THEIR CAPACITY AS CO - OWNERS AND TENANTS. WHAT THE APPELLANT RECEIVED IS FOR THE TRANSFER AND THE CONSENT GIVEN FOR TRANSFER OF TENANCY RIGHTS FROM THE OLD TENANTS TO THE NEW TENAN T. THE EIGHT CO - OW NERS HAVE IN THEIR CAPACITY AS TENANTS. THEY HAVE ALSO RECEIVED 2/3 RD OF THE PREMIUM AMOUNT OF RS. 14 CRORES IN THEIR CAPACITY AS TENANTS. IT IS ONLY THE REMAINING 1/3 RD WHICH HAS BEEN SHARES BY ALL THE 9 CO - OWNERS IN THE RATIO OF THEIR OWNERSHIP. THIS SEL F CONFESSION BY THE 8 CO - OWNERS CANNOT BE IGNORED. THEREFORE, THE AMOUNT OF RS. 1,16,66,000/ - RECEIVED BY THE APPELLANT HAS TO BE TREATED AS INCOME FROM OTHER SOURCES AND NOT I NCOME FROM CAPITAL GAINS . 7 . THERE WAS ANOTHER ISSUE OF ADDITION OF A SUM OF RS. 3,11,12,000/ - AS PROPORTIONATE DIFFERENCE BETWEEN 8.33% RECEIVED BY THE ASSESSEE AS AGAINST SHARES OF 25% IN OWNERSHIP OF THE PROP E R T Y. THE ASSESSING OFFICER OBSERVED THAT THE SHARE OF THE ASSESSEE IN THE PROPERTY IS 25% AND THEREFORE HE IS ENTITLED TO DOUBLE THE AMOUNT RECEIVED BY KRISHNA KHATAU, YOGESH KHATAU AND JANAK KHATAU WHO HELD THE SHARE OF 12.5% EACH. ACCORDINGLY, HE MULTIPLIED THE AMOUNT RECEIVED BY EACH OF THESE PERSONS 2,13,89,000/ - BY TWO AND ARRIVED AT THE ASSESSEES SHARE AT RS. 4,27,78, 000/ - . 8 . LEARNED CIT(A) DELETED THIS ADDITION BY OBSERVING AS UNDER : - THE LEARNED COUNSEL FOR THE ASSESSEE HAS EXPLAINED BOTH AT THE TIME OF ASSESSMENT PROCEEDINGS AS WELL AS APPELLATE PROCEEDINGS THAT THE OTHER 8 CO - OWNERS HAVE PAID A SUM OF RS.60 LA KHS IN 1993 FOR VACATION OF THE TENANT. THEREFORE THEY HAD AN INTERNAL AGREEMENT, THAT, FROM THE AMOUNT RECEIVED FROM THE NEW TENANT WHICH IS DAWAT - E - HADIYAH TRUST, 2/3 RD CONSIDERATION WILL BE SHARED BY 8 CO - OWNERS AND THE APPELLANT WOULD RECEIVED HIS 25% SHARE FROM THE BALANCE 1/3 RD CONSIDERATION. ACCORDINGLY, THE APPELLANT RECEIVED RS. 1,16 ,66 , 000/ - DIRECTLY BY WAY OF CHEQUE FRO M THE DAWAT E - HALIY H TRUST. THE AO HAS DISCUSSED AT LENGTH THAT THE STAMP VALUE OF THE PROPERTY WAS RS. 17,24,28,000/ - BUT IT WAS TRANSFERRED ONLY FOR A SUM OF RS.14 CRORES. THE DIFFERENCE WORKS OUT TO 'ALMOST THE SAME' AS THE ASSESSEE'S LEGITIMATE SHARE. THE REFORE, HE PRESUMED THAT THIS AMOUNT HAS BEEN RECEIVED BY THE APPELLANT BUT NOT DECLARED. HOWEVER, THIS IS JUST THE PRESUMPTIO N OF T HE AO WITH NO BASIS OR EVIDENCE. EVEN IF IT IS PRESUMED THAT THE DIFFERENCE HAS BEEN RECEIVED IN CASH, WHY WOULD THE APPELLANT ALONE RECEIVE D THE CASH WHEN THERE ARE EIGHT OTHER CO - OWNERS? THE 8 CO - OWNERS HAVE SUBMITTED IN WRITING THAT SHRI HEMANT RANJIT KHATAU 6 THERE WAS AN A GREEMENT AMONGST THEM AND ACCORDINGLY THE APPELLANT HAS RECEIVED ONLY RS. 1, 16,66,000/ - WHICH WORKS OUT TO 8.33% OF THE TOTAL CONSIDERATION. THE REMAINING 91 . 67% HAS BEEN DISTRIBUTED AMONGST 8 OF THEM AND THEY HAVE SHOWN IT IN THE RESPECTIVE RETURNS OF INC OME WHICH HAVE BEEN ACCEPTED BY THE DEPARTMENT. AS ALREADY DISCUSSED, THE PROVISION OFSECTION 50C OR SECTION 56(2) ARE NOT APPLICABLE TO THIS CASE. WHAT IS RECEIVED BY THE CO - OWNERS IS ONLY RS.14 CRORES AND WHAT CAN BE TAXED IS ONLY THIS AMOUNT. THE APPELL ANT HAS RECEIVED 8.33% O NLY OF THIS CONSIDERATION INSTEAD OF HIS SHARE OF 25% DUE TO REASONS ALREADY DISCUSSED. THERE IS NO REVENUE LOSS AS THE ENTIRE AMOUNT HAS BEEN OFFERED TO TAX, ALBEIT, IN DIFFERENT HANDS. RELIANCE IS PLACED ON THE CASE OF CIT VS. RAM AN KUMAR SURI 255 CTR 257 WHERE THE JURISDICTIONAL HIGH COURT HELD THAT THE AO WAS NOT JUSTIFIED IN ASSESSING THE SALE CONSIDERATION OF RS.7 CRORES WHERE HE HAS RECEIVED ONLY RS.6 CRORES AS PER MOD AS PER AN ARRANGEMENT. THIS WAS A CASE WHERE THE PROPERTY HAS BEEN SOLD BY TWO BR OTHERS FOR A CONSIDERATION OF RS. 14 CRORES. EACH BROTHER SHOULD HAVE RECEIVED A SHARE OF RS.7 CRORES, BUT AS PER PERSONAL MOU, ONE OF THE BROTHERS RECEIVED RS. 6 CRORE AND THE OTHER RECEIVED RS. 8 CRORES. THE ASSESSING OFFICER DEEME D THE CONSIDERATION RECEIVED BY THE BROTHERS AS RS. 7 CORRES INSTEAD OF RS. 8 CRORES. THE HON'BLE JURISDICTIONAL HIGH COURT HELD THAT THIS WAS NOT JUSTIFIED AND THAT THE ASSESSEE SHOULD BE TAXED ONLY ON THE SALE CONSIDERATION OF RS. 6 CRORES WHICH WAS ACTU ALLY RECEIVED BY HIM. IN THIS CASE AS PER AN AGREEMENT, FOR REASONS ALREADY DISCUSSED, THE APPELLANT WAS DUE TO RECEIVED 25% OF THE 1/3 RD CONSIDERATION WHIC H HE RECEIVE D AND OFFERED TO TAX. THIS WORKS OUT TO 8.33% OF THE TOTAL CONSIDERATION. THE BALAN CE C ONSIDE RA TION HAS BEEN RECEIVED AND OFFERED TO TAX BY THE REMAINING 8 CO - OWNERS. THERE IS NO REVENUE LOSS. THEREFORE, THE ADDITION MADE BY THE AO WHICH IS ONLY A MERE PRESUMPTION OF RS. 3,11,12,000/ - CANNOT BE SUSTAINED . 9 . AGAINST THE ABOVE ORDER ASS ESSEE HAS FILED APPEAL BEFORE US . 1 0 . WE HAVE HEARD BOTH THE COUNSEL AND PERUSED THE RECORDS. THE SUBMISSION OF LEARNED COUNSEL OF THE ASSESSEE IS SUMMARIZED AS UNDER : - THE APPELLANT SUBMITS THAT THE REAL NATURE OF THE TRANSACTION WHICH IS ALSO THE APPA RENT TRANSACTION IS THAT IT IS FOR THE TRANSFER OF TENANCY RIGHTS IN THE SAID PROPERTY FROM THE LANDLORD (INCLUDING THE APPELLANT) TO THE TENANT (DAWAT - E - HADIYAH TRUST). IN THIS REGARD, THE APPELLANT RELIES ON THE FOLLOWING: - ( A ) BARE PERUSAL OF THE TENAN CY AGREEMENT DATED 30.12.2011 (SEE PAGES 10 TO 14 OF THE PAPER BOOK) SHOWS THAT IT IS A TRANSACTION OF TRANSFER OF TENANCY RIGHT BY THE LANDLORDS TO THE TENANT AND NOT WHERE SUCH TENANCY RIGHTS ARE TRANSFERRED BY THE EARLIER TENANT TO A NEW TENANT AND WHER E SIMPLY CONSENT IS GIVEN BY THE LANDLORD. ( B ) FOR JUSTIFYING THE TRANSACTION AS TRANSFER OF TENANCY RIGHTS BY THE EARLIER TENANT (OTHER 8 CO - OWNERS) TO THE NEW TENANT (DAWAT - E - HADIYAH TRUST) WITH THE LANDLORDS (INCLUDING THE APPELLANT) GIVING HIS CONSENT FOR SUCH TRANSFER, THE A.O. AND THE CIT(A) HAVE RELIED ON LETTER DATED 10.03.2015 FROM THE OTHER 8 CO - OWNERS TO THE A.O. THE SAID LETTER IS ONLY FOR JUSTIFICATION FOR PAYMENT OF SHRI HEMANT RANJIT KHATAU 7 8.33% OF THE CONSIDERATION TO THE APPELLANT AS AGAINST HIS RIGHT TO THE EXTEN T OF 25%, IT HAS BEEN URGED THAT HE HAD NOT SHARED IN THE CONSIDERATION TO BE PAID TO THE OUTGOING TENANT FOR SURRENDER OF TENANCY RIGHT IN THE YEAR 1993. HENCE, 2/3 RD OF THE CONSIDERATION RECEIVED FROM THE PRESENT TENANCY AGREEMENT IS SHARED ONLY BETWEEN THE OTHER 8 CO - OWNERS WHILE THE BALANCE 1 /3 RD IS SHARED BETWEEN ALL THE 9 CO - OWNERS INCLUDING THE APPELLANT. THE REASON GIVEN FOR SUCH DISPROPORTIONATE SHARING IS THAT AS PER CUSTOM NORMALLY TENANT AT THE TIME OF TRANSFERRING THE TENANCY RI GHT TO A NEW TEN ANT HAS TO PAY 1/ 3 RD OF THE AMOUNT TO THE LANDLORD. THE APPELLANT SUBMITS THAT THIS IS ONLY A METHODOLOGY USED FOR DIVIDING THE CONSIDERATION BETWEEN THE PARTIES. THE TRANSACTION IN THE YEAR 1993 WAS SURRENDER OF TENANCY RIGHTS BY THE EARLIER TENANT TO THE LANDLORDS. IT WAS NOT A CASE OF TRANSFER OF TENANCY RIGHTS BY THE EARLIER TENANTS TO THE OTHER 8 CO - OWNERS AS NEW TENANTS. AFTER THE SAID SURRENDER THE PROPERTY HAS REMAINED VACANT AND UNOCCUPIED BY ANY ONE. AT THAT POINT OF TIME NO TENANCY WAS CREATED IN FAVOUR OF THE OTHER 8 CO - OWNERS AS NEW TENANTS. (C) IT IS WELL SETTLED BY NOW THAT NATURE OF A TRANSACTION IS TO BE JUDGED BASED ON THE DOCUMENTS EXECUTED BETWEEN THE PARTIES. IN THE PRESENT CASE, THE TENANCY AGREEMENT DATED 30.12.2011 IS FOR TRANSFER OF TENANCY RIGHT BY ALL THE 9 CO - OWNERS AS LAN DLORDS AND NOT A CASE, WHERE, T ENA N CY RIGHT ALLEGED TO BE BELONGING TO O THER 8 CO - OWNERS HAS BEEN TRANSFERRED TO NEW TENANT FOR WHICH CONSENT HAS BEEN GIVEN BY THE NINTH CO - OWNER THE APPELLANT - LANDLORD. THE AO AN D THE CIT(A) ERRED IN DISREGARDING THIS POSITION. (D) IN THE PRESENT CASE, IT IS AN ADMITTED POSITION AS REFERRED TO IN LETTER DATED 10.03.2015 FROM THE OTHER 8 CO - OWNERS TO THE A.O. THAT, IN THE YEAR 1993 VACANT POSSESSION HAS BEEN OBTAINED BY ALL THE NI NE CO - OWNERS. THIS IS ALSO THE BASIS FOR THE PRESENT TENANCY AGREEMENT AS MADE CLEAR BY ITS SECOND RECITAL AT PAGE 11 OF THE PAPER - BOOK. THIS FACT HAS ALSO BEEN REPEATEDLY ASSERTED BY THE APPELLANT BEFORE THE AO AND THE CIT(A), WHICH FACT REMAINS UNDISPUTE D. SINCE THE SAID PROPERTY REMAINED VACANT FROM 1993 TO 31.10.2011, IT CANNOT BE A CASE OF TRANSFER OF TENANCY RIGHTS BY AN EARLIER TENANT TO A NEW TENANT. ONCE IT IS ACCEPTED THAT THE SAID PROPERTY WAS UNOCCUPIED AND WAS LYING VACANT, IT IS A CASE OF TRAN SFER OF TENANCY RIGHT BY THE LANDLORDS TO THE TENANT. (E) IN THE LETTER DATED 10.03.2015 FROM THE OTHER 8 CO - OWNERS TO THE AO, AT ONE PLACE, IT HAS BEEN STATED THAT ALL OTHER CO - OWNERS HAVE DECLARED THEIR INDIVIDUAL SHARES AGGREGATING TO BALANCE 91.67% (1 00 - 8.33) AS RECEIVED BY THEM RESPECTIVELY UNDER THE SAID AGREEMENT (AS CO - OWNERS AND TENANTS) IN THEIR RETURN OF INCOME AND THEY HAVE PAID THE TAXES ON THEIR SHARES ACCORDINGLY THEREON'. AT ANOTHER PLACE, IN THE SAID LETTER, IT HAS BEEN STATED THAT 'RETURN OF INCOME UNDER PAN AABAK2550K IN THE NAME OF KISHORE KHATAU AND OTHERS WAS FILED ON 28 - 6 - 2012 WITH ITO - 16 - (3) - (4) FOR A.Y. 2012 - 13 DECLARING INCOME UNDER THE HEADS HOUSE PROPERTY / INTEREST / DIVIDEND ETC.'. RELYING ON THE LATER VERSION, THE AO AND THE C IT(A) HAVE HELD THAT EVEN THE OTHER 8 CO - OWNERS HAVE OFFERED THE INCOME RECEIVED BY THEM AS TRANSFEROR TENANTS. BASED THEREON, IT IS ALLEGED THAT THIS IS A CASE OF TRANSFER BY EARLIER TENANTS (THE OTHER 8 CO - OWNERS) TO THE NEW TENANT (DAWAT - E - HADIYAH TRUST ). THE APPELLANT SUBMITS THAT THERE IS AN INHERENT INCONSISTENCY IN THE TWO VERSIONS. A BARE PERUSAL OF THE FIRST VERSION SHOWS THAT THE INCOME HAS BEEN SHRI HEMANT RANJIT KHATAU 8 INDIVIDUALLY OFFERED FOR TAX IN THE HANDS OF EACH OF THE OTHER CO - OWNERS TO PROVE THAT 91.67% HAS BEEN TAXED IN THE HANDS OF CO - OWNERS AND THE BALANCE 8.33% HAS BEEN OFFERED BY THE APPELLANT. IN FACT, ONE OF THE CO - OWNER BEING MR.VINAY KHATAU HAS BEEN ASSESSED ON THE ENTIRE INCOME RECEIVED AS CAPITAL GAINS. IN SUPPORT THEREOF, THE APPELLANT HAS HANDED OVER A COPY OF HIS ASSESSMENT ORDER. IF, THE TRANSACTION WAS THAT OF TRANSFER BY EARLIER TENANT TO NEW TENANT AS CONTENDED BY THE AO AND THE CIT(A), THEN, TO THE EXTENT OF 2/3 RD CONSIDERATION THE OTHER 8 CO - OWNER OUGHT TO HAVE BEEN ASSESSED AS CAPITAL GAINS AND THE BALANCE 1 /3 RD AS INCOME FROM OTHER SOURCES. FURTHER, IT CANNOT BE THAT THE SAME INCOME HAS BEEN OFFERED FOR TAXED TWICE BY THE 8 OTHER CO - OWNERS ONCE IN THEIR INDIVIDUAL HANDS AND AGAIN AS AN AOP. LASTLY, IT IS SUBMITTED THAT UNDERSTANDING OF THE PARTIES, DOES NOT MAKE THE LAW. THERE IS NO ESTOPPEL AS TO LAW. THE LEGAL POSITION HAS TO BE ASCERTAINED BASED ON THE DOCUMENTS THAT HAVE BEEN EXECUTED. BASED THEREON, IT IS CLEAR THAT IN THE PRESENT CASE, TENANCY RIGHT HAS BEEN TRANSFERRED BY THE LANDLORDS INCLUDING THE APPELLANT TO THE TENANT BEING DAWAT - E - HADIYAH TRUST . (F) AS PER THE BOMBAY STAMP ACT, STAMP DUTY IS TO BE PAID UNDER ARTICLE 36 FOR CREATION OF TENANCY I.E., FOR TRANSFER OF TENANCY RIGHT FROM THE LANDLORD TO THE TENANT. IN THE PR ESENT CASE, STAMP DUTY HAS BEEN PAID UNDER THE SAID ARTICLE (SEE PAGE 64 OF THE PAPER BOOK). FOR TRANSFER OF TENANCY BY EARLIER TENANT TO THE NEW TENANT STAMP DUTY HAS TO BE PAID AS PER ARTICLE 5(G - D) OF THE STAMP ACT. IN THE PRESENT CASE, STAMP DUTY HAS N OT BEEN PAID UNDER THE SAID ARTICLE. IN VIEW OF THE ABOVE, THE APPELLANT SUBMITS THAT HE HAS RECEIVED THE CONSIDERATION FOR TRANSFER OF TENANCY RIGHTS AS A LANDLORD AND NOT FOR GIVING HIS CONSENT AS A LANDLORD FOR SUCH TRANSFER BY AN EARLIER TENANT TO A N EW TENANT. THAT SUCH TRANSFER BY A LANDLORD TO A TENANT WOULD GIVE RISE TO CAPITAL GAINS IS MADE CLEAR BY JUDGMENT OF THE HON'BLE APEX COURT IN A. R. KRISHNAMURTHY AND ANR. VS. CIT 176 ITR 417 THE ORDER IN THE CASE OF VINOD V. CHHAPIA VS. I.T.O RELIED UPO N BY THE AO AND THE CIT(A) WAS A CASE WHERE, THE ISSUE INVOLVED RELATED TO THE AMOUNT RECEIVED BY THE LANDLORD FOR GIVING HIS CONSENT FOR PERMITTING THE SUB TENANT TO OCCUPY THE PREMISES IN PLACE OF THE TENANT AND RETAINING THE TENANCY RIGHTS OF THE TENANT . IN THE PRESENT CASE, SINCE THE FACTUAL POSITION IS DIFFERENT THE SAID ORDER WILL HAVE NO APPLICATION. AS STATED ABOVE, THE AO HAD TOUCHED UPON TWO DISTINCT ASPECTS RELATING TO THE SAID TENANCY AGREEMENT BEING : - (A) ASSESSMENT OF THE APPELLANT TO 25% O F THE CONSIDERATION BEING RS.4,27,78,000/ - AS AGAINST THE ACTUAL AMOUNT OF RS. 1,16,66,OOO/ - RECEIVED BY HIM AND (B) THE HEAD OF INCOME UNDER WHICH THE SAID AMOUNT WAS TO BE ASSESSED. ACCORDING TO THE APPELLANT, THE SAID AMOUNT WOULD BE ASSESSABLE AS CAPIT AL GAINS WHILE THE AO ASSESSED IT AS INCOME FROM OTHER SOURCES. SINCE THE AFORESAID TWO ISSUES WERE RAISED BY THE AO, THE CIT(A) HAS ALSO DEALT WITH BOTH OF THEM INDEPENDENTLY. IN SO FAR AS THE FIRST ISSUE IS CONCERNED HE SHRI HEMANT RANJIT KHATAU 9 HAS UPHELD THE APPELLANT'S CLAIM THAT HE CAN BE ASSESSED ONLY ON THE ACTUAL CONSIDERATION RECEIVED BY HIM AND NOT WHAT HE OUGHT TO HAVE RECEIVED. IN THIS REGARD HE HAS FOLLOWED JUDGEMENT OF HIGH COURT AT BOMBAY IN RAMAN KUMAR SURI (SUPRA) (SEE PARA 4 AT PAGES 10 TO 13 OF THE APPELLATE ORDE R). THIS FINDING OF THE CIT(A) HAS BECAME FINAL AS NO APPEAL AGAINST THE SAME HAS BEEN FILED BY THE REVENUE BEFORE THE TRIBUNAL. SINCE THE FINDING OF THE AO ON THE SECOND ISSUE WAS UPHELD BY THE CIT(A) (SEE PARA 3 AT PAGES 2 TO 9 OF THE APPELLATE ORDER), T HE APPELLANT HAS FILED AN APPEAL AGAINST THE SAME. HENCE, THE ISSUE INVOLVED IN THE PRESENT APPEAL IS ONLY WITH RESPECT TO THE HEAD OF INCOME AND CONSEQUENT GRANT OF EXEMPTION U/S. 54EC OF THE ACT. THE OTHER ISSUE THAT HAS BEEN REFERRED TO IN THE CLARIFI CATION HEARING ON 20.12.2019 IS THAT WHY THE TRANSFER OF TENANCY RIGHT SHOULD NOT BE HIT BY SECTION 50C OF THE ACT. IN THE PRESENT CASE, THE AO SOUGHT TO INVOKE THE PROVISIONS OF SECTION 50C OF THE ACT, IN THE COURSE OF ASSESSMENT PROCEEDING FOR WHICH SHOW - CAUSE NOTICE DATED 20.10.2014 WAS ISSUED (SEE PAGES 15 OF THE PAPER - BOOK) IN R ESPONSE THERETO, THE APPELLANT HAS FILED HIS SUBMISSION VIDE LETTERS DATED 20.10.2014 (SEE PAGES 16 AND 17 OF THE PAPER - BOOK) DATED 28.10.2014 (SEE PAGES 18 AND 19 OF THE PAPER BOOK), DATED 12.01.2015 (SEE PAGE 31 OF THE PAPER BOOK) AND DATED 16.02.2015 (SEE PAGES 39 - 40 OF THE PAPER BOOK). SATISFIED WITH THE APPELLANT'S SUBMISSION, THE AO HAS NOT MADE ANY ADDITION BY INVOKING THE PROVISIONS OF SECTION 50C OF THE ACT. IN VIEW THER EOF, THE APPELLANT SUBMITS THAT THE SAID ISSUE DOES NOT ARISE IN THE PRESENT APPEAL. ASSUMING WITHOUT ADMITTING THAT THE SAID ISSUE ALSO NEEDS CONSIDERATION IT IS SUBMITTED THAT THE SAID SECTION WOULD APPLY ONLY WHEN THERE IS A TRANSFER OF LAND AND/OR BUIL DING. IN THE PRESENT CASE, THERE IS A TRANSFER OF 'TENANCY RIGHTS' IN BUILDING AND NOT TRANSFER OF THE BUILDING. IN THIS REGARD, RELIANCE IS PLACED ON TRIBUNAL'S ORDER IN THE CASE OF ATUL G. PURANIK V. ITO 132 ITD 499 (MUM). THE SAID ORDER OF THE TRIBUNAL HAS BEEN ACCEPTED BY THE REVENUE AS NO APPEAL AGAINST THE SAME HAS BEEN FILED BEFORE THE HIGH COURT. CONSIDERING THIS FACT, THE BOMBAY HIGH COURT IN CIT V. GREENFIELD HOTELS AND ESTATES PVT. LTD. 389 ITR 68 HAS DISMISSED THE REVENUE'S APPEAL. IN VIEW OF T HE ABOVE, I SUBMIT THAT THE TRIBUNAL MAY BE PLEASED TO ALLOW THE APPEAL AND HOLD THE NATURE OF THE RECEIPT IN THE HANDS OF THE APPELLANT AS CAPITAL GAINS AND, CONSEQUENTLY GRANT EXEMPTION UNDER SECTION 54EC OF THE ACT. 11. PER CONTRA, LEARNED DEPARTMENTA L REPRESENTATIVE RELIED UPON THE ORDERS OF THE AUTHORITIES BELOW. 12. UPON CAREFUL CONSIDERATION, WE NOTE THAT THE ASSESSEE IS A CO - OWNER IN A BUILDING. ASSESSEES SHARE WAS 25% THEREOF. PROPERTY WAS TENANTED TO ANOTHER CONCERN AND THE TENANCY RIGHTS WERE SOLD FOR A SUM OF RS. 14 CRORES. IN THE RETURN OF INCOME INSTEAD OF SHOWING 25% AS ASSESSEES SHARE, ASSESSEE SHOWED ONLY 8.33% OF THE SUM RECEIPT. WHEN THIS WAS ENQUIRED INTO, THE ASSESSEE SHRI HEMANT RANJIT KHATAU 10 EXPLAINED THAT THERE WERE EIGHT CO - OWNERS. THE SAID PROPERTY WAS HAVING TENANTS EARLIER. THESE TENANTS WERE GOT VACATED IN THE YEAR 1993. FOR THIS OTHER CO - OWNERS EXCEPT THE ASSESSEE CONTRIBUTED S U M S OF MONEY AND HENCE IN THE SAID PROPERTY ASSESSEES SHARE OF 25% GOT ALTERED. OTHER CO - OWNERS RETAINED 2/3 RD AS THEIR SHAR ES DEVOID OF ASSESSEE HAVING SHARE THEREIN. ASSESSEE WAS CONSIDERED AS CO - OWNER IN THE REMAINING 1/3 RD . HENCE, ASSESSEES 25% SHARES IN 1/3 RD CAME TO 8.33% OF RECEIPT, WHICH THE ASSESSEE OFFERED AS HIS SHARE OF CAPITAL GAIN. ASSESSING OFFICER WENT BY THE A SSESSEES SHARE IN THE PROPERTY OF 25%. HE HELD THAT ASSESSEE SHOULD BE ENTITLED FOR 25% OF THE RECEIPT AS HIS SHARE. HOWEVER, THE ASSESSING OFFICER THEREAFTER WENT BY THE OTHER SUBMISSIONS OF THE ASSESSEE WHEREIN IT WAS SUBMITTED THAT 2/3 RD PORTION HAVE B EEN RETAINED BY OTHER CO - OWNER S AS THEY HAVE CONTRIBUTED TO GE T BUILDING VACATED IN 1993. HE ALSO OPINED THAT SINCE THEN OTHER CO - OWNERS WERE TENANTS OF ASSESSEE IN THAT RESPECT. HENCE, HE HELD THAT ASSESSEES SHARE WILL AMOUNT TO INCOME FROM OTHER SOURCES AS THE ASSESSEE HAS ONLY CONSENTED TO THE SALE TENANCY RIGHTS. THE ASSESSING OFFICER IN THIS REGARD PLACED RELIANCE UPON THE DECISION OF VINOD V. CHHAPIA (SUPRA). WHEN THE MATTER TRAVELLED TO LEARNED CIT(A), LEARNED CIT(A) WENT BY THE ASSESSEES SUBMISSIO N THAT CO - OWNERS GOT PROPERTY VACATED BY PAYING SUMS TO THE TENANTS. THAT THEY AGREED THAT THEIR 2/3 RD SHARES AMONGST THEMSELVES AND THEREAFTER 1/3 RD SHARE ALONGWITH THE ASSESSEE. HENCE, HE REJECTED THE ASSESSING OFFICERS ADDITION OF 25% IN THE HANDS OF T HE ASSESSEE. FURTHERMORE LEARNED CIT(A) HELD THAT IT WAS SUBMITTED BEFORE HIM THAT OTHER CO - OWNERS HAVE OFFERED 2/3 RD SHARES IN THEIR CAPACITY AS AOP AND REMAINING 1/3 RD WAS SHARES WITH ASSESSEE. HENCE, LEARNED CIT(A) AGREED THAT ASSESSEES SHARE CAME TO 8 .33%. HOWEVER, HE FURTHER UP HELD ASSESSING OFFICERS ACTION IN THIS REGARD THAT ASSESSEE HAD ONLY CONSENTED TO TRANSFER OF TENANCY RIGHTS AND HIS SHARE WAS TO BE TAXED AS INCOME FROM OTHER SOURCES AND HE DENIED THE ASSESSEES CLAIM U/S. 54EC OF THE ACT. 13. NOW IN APPEAL BEFORE US THE LEARNED COUNSEL OF THE ASSESSEE SUBMITS THAT ASSESSEE SUBMISSIONS BEFORE THE AUTHORITIES BELOW ARE PARTLY CORRECT AND HE CONTENDS THAT OTHER SUBMISSIONS ARE OTHER VERSIONS WHICH HE DISPUTES. SHRI HEMANT RANJIT KHATAU 11 THE LEARNED COUNSEL OF THE ASSESSEE STATES THAT IN THE SUBMISSIONS OF THE ASSESSEE AND HIS LETTERS BEFORE THE AUTHORITIES BELOW THE PURPORT WAS ONLY TO ESTABLISH THAT ASSESSEE SHARE HAS BECOME 8.33% FROM THE ORIGINAL 25%. IN THIS REGARD LD COUNSEL OF THE ASSESSEE SUBMITS THAT THE OT HER PART OF THE SUBMISSION ARE MERELY OTHER VERSION WHICH THE LEARNED COUNSEL OF THE ASSESSEE NOT ONLY WANTS TO BE IGNORED BUT ALSO DISPUTES THEM AS REGARDS THEIR VERACITY. 14. WE NOTE THAT IT IS SETTLED LAW THAT THE PARTY CANNOT APPROBATE AND REPROBATE O N THE SAME ISSUE OR THE DOCUMENT. HERE WE FIND THAT THE LEARNED COUNSEL OF THE ASSESSEE WISHES THAT ONLY THAT PART OF ASSESSEE SUBMISSION BEFORE THE AUTHORITIES BELOW SHOULD BE CONSIDERED WHICH SHOWED THAT ASSESSEES SHARE IN THE PROPERTY HAS GONE DOWN FRO M 25% TO 8.33%. HOW THIS SHARE OF 25% BECAME 8.33% WITHOUT ANY WRITTEN AGREEMENT IN THIS REGARD, AS SUBMITTED TO THE AUTHORITIES BELOW IS DESIRED TO BE NOT ONLY IGNORED BUT FOUND TO BE INCORRECT. HOWEVER IN OUR CONSIDERED OPINION IT IS NECESSARY TO CONSIDE R THE FACTS SUBMITTED BEFORE THE AUTHORITIES BELOW ON THE BASIS OF WHICH IT WAS CLAIMED THAT ASSESSEE SHARE HAS GONE DOWN FROM 25% TO 8.33% AS A WHOLE. LEARNED COUNSEL HIMSELF SUBMITS THAT THE UNDERSTANDING BETWEEN THE PARTIES CANNOT CHANGE THE LAW. HE ALS O RIGHTLY SUBMITS THAT THERE IS NO ESTOPPEL IN LAW. 15. HENCE WE CONSIDER THE CIRCUMSTANCES AS EXPLAINED BEFORE THE AUTHORITIES BELOW WHICH LED TO THE ASSESSEE SHARE IN THE PROPERTY GOING DOWN. AS ALREADY EXPLAINED IN THE EARLIER PART OF THIS ORDER THE A SSESSEES STAND AND EXPLANATION WAS THAT OTHER CO - OWNERS HAVE CONTRIBUTED SUMS OF MONEY TO GET THE PROPERTY VACATED FROM EARLIER TENANTS WITHOUT ASSESSEE CONTRIBUTING THEREIN. THEREAFTER IN SUBSEQUENT SALE OF THE TENANCY OTHER CO - OWNERS OFFERED IN THEIR RE TURN OF INCOME 2/3 R D SHARE AS AOP. THIS ADMITTEDLY SIGNIFIES THAT ASSESSE E WAS DENUDED OF HIS SHARE TO THIS EXTENT. THIS MAKES IT CLEAR THAT OTHER CO - OWNERS WERE HOLDING THE PROPERTY AS AOP WITHOUT THE ASSESSE E BEING PART OF IT. WHEN THESE DEDUCTIONS ARE G IVEN EFFECT THE ASSESS E E BECOMES ONLY A CONSENTOR TO THE SALE OF TEN A NCY RIGHT AND THE INCOME IS TO BE TREATED AS INCOME FROM OTHER SOURCES. NOW THERE IS NO WRITTEN AGREEMENT TO THIS EFFECT. IT IS ONLY THE LETTERS SHRI HEMANT RANJIT KHATAU 12 SUBMITTED BY THE ASSESSEE ALONG WITH OTHER CO - OWNERS BEFORE THE AUTHORITIES BELOW WHICH ESTABLISHED THE ABOVE. IF THE ABOVE SUBMISSION HAS TO BE GIVEN EFFECT IT HAS TO BE GIVEN EFFECT FULLY AND NOT IN BITS AND PIECES AS THE LEARNED COUNSEL OF THE ASSESSEE SUBMITS. THIS A S ALREADY NOTED BY US IS NO T PERMITTED BY THE COMMON - LAW MAXIM OF APPROBATE AND REPROBATE. 16. THE LEARNED COUNSEL OF THE ASSESSEE NOW SUBMITS THAT THE SUBMISSION BEFORE THE AUTHORITIES BELOW THAT OTHER CO - OWNERS OFFERED 2/ 3 RD INCOME AS AOP IS ALSO NOT CORRECT. AS HE SUBMITS THAT SAME INCOME CANNOT BE OFFERED TWICE ; ONCE IN THE CAPACITY OF AOP AND ANOTHER IN INDIVIDUAL CAPACITY. WE NOTE THAT THIS IS NOT SOMETHING WHICH THE REVENUE AUTHORITIES HAVE IMAGINED. IT IS ONLY FROM THE LETTERS AND SUBMISSIONS OF THE ASSESSEE AND THE CO - OWN ERS THAT THESE ASPECTS HAVE EMANATED. NOW IF THE LEARNED COUNSEL OF THE ASSESSEE DISPUTES THE SUBMISSIONS AS REGARDS THEIR VERACITY THE ENTIRE SUBMISSION IS TO BE IGNORED AND THE ASSESSEES SHARE IN THE PROPERTY SHALL REMAIN TO BE 25% AS IS THE CASE DEHORS E THESE SUBMISSIONS. NOW IN THIS REGARD LEARNED COUNSEL OF THE ASSESSEE SUBMITS THAT LEARNED CIT(A) HAS ALREADY HELD THAT ASSESSEES SHARE IN THE PROPERTY CANNOT BE CONSIDERED TO BE 25%. THIS MAKES IT AMPLY CLEAR THAT THE SUBMISSIONS BEFORE THE LEARNED CIT APPEALS HAVE NOT BEEN CORRECT AND IN GOOD FAITH AND/OR LEARNED CIT APPEALS HAS COMMITTED AN ERROR IN APPRECIATING THE SUBMISSIONS. IN THIS REGARD WE PLACE RELIANCE UPON THE DECISION OF HONOURABLE SUPREME COURT IN THE CASE OF KAPURCHAND SRIMAL VS. CIT ( 13 1 ITR 451) THAT IT IS THE DUTY OF THE APPELLATE AUTHORITY TO CORRECT THE ERRORS IN THE ORDERS OF THE AUTHORITIES BELOW AND REMIT THE MATTER FOR FRESH CONSIDERATION WITH OR WITHOUT DIRECTIONS UNLESS PROHIBITED BY LAW. IN THE PRESENT CASE WE FIND THAT THE ASSESSEE IS NOT ABIDING BY ITS SUBMISSIONS BEFORE THE LEARNED CIT APPEALS. IT IS POINTING INCONSISTENCIES AND ERRORS IN ITS SUBMISSIONS BEFORE THE AUTHORITIES BELOW. WITH THE HELP OF THESE SO - CALLED INCONSISTENCIES IN SUBMISSIONS AND THEIR LEGAL UNSUSTAINA BILITY, IT IS ALSO POINTING OUT ERRORS IN THE ORDER OF THE LEARNED CIT APPEALS. WE FIND THAT IN THESE CIRCUMSTANCES INTEREST OF JUSTICE WILL BE SERVED IF THE ISSUE IS REMITTED TO THE FILE OF LEARNED CIT SHRI HEMANT RANJIT KHATAU 13 APPEALS. LEARNED CIT(A) IS DIRECTED TO CONSIDER THE I SSUE AFRESH IN LIGHT OF OUR OBSERVATIONS AND SUBMISSIONS OF THE LEARNED COUNSEL OF THE ASSESSEE AS ABOVE. 17. NEEDLESS, ASSESSEE SHOULD BE GRANTED ADEQUATE OPPORTUNITY OF BEING HEARD. 18. IN THE RESULT APPEAL BY THE ASSESSEE STANDS ALLOWED FOR STATISTICA L PURPOSES. ORDER HAS BE EN PRONOUNCED IN THE COURT ON 17 . 3 . 20 20 . SD/ - SD/ - (PAWAN SINGH ) (SH A MIM YAHYA ) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI ; DATED : 17 / 0 3 / 20 20 COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// ( ASSISTANT REGISTRAR ) PS ITAT, MUMBAI