TMI Blog2005 (12) TMI 258X X X X Extracts X X X X X X X X Extracts X X X X ..... he AO, after going through the revised return, found that the assessee has another residential house from which the income from house property was declared. He disallowed the exemption under s. 54F of the Act as claimed by the assessee by giving the reasoning that the assessee is owning another house and the condition for allowance of exemption under s. 54F of the Act is that the assessee should not have any other house, then only he is entitled for exemption under s. 54F of the Act. Aggrieved, the assessee preferred an appeal against the disallowance of exemption before the CIT(A) who confirmed the finding of the AO. Aggrieved, the assessee is in second appeal before the Tribunal. 3. First of all, the assessee has raised additional grounds and the issue arises out of these additional grounds is as to whether the AO has erred in acting on revised return which is out of time and barred by limitation as per the provisions of s. 139(5) of the Act or not. From the assessment order, it is gathered that the factum regarding the revised return was available. The assessee filed the original return on 2nd July, 1996 within the due date for the asst. yr. 1996-97 and he filed the revised re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e exemption under s. 54F of the Act. Hence, the argument of the assessee that the AO has acted on the revised return (is) not based on the facts on record. These facts speak out of the assessment orders. He further argued that the facts in the case law cited by the learned counsel for the assessee are entirely distinguishable from the facts of the present case as the assessment proceedings were initiated on the original return and not on the revised return. It is an admitted fact that the revised return is a belated one and barred by limitation. Further, the learned Departmental Representative argued that the plea of the assessee that the AO has acted on the revised return is not based on any facts and accordingly, the lower authorities disallowed the exemption under s.54F of the Act which is based on the original return. 6. We have heard both the sides on this legal issue and gone through the case records including the precedents relied on. The facts of the case are very clear that the AO has taken up the assessment proceedings for scrutiny under s. 143(2) of the Act on the original return filed on 2nd July, 1996. The assessee during the course of scrutiny, revised the return on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. According to this sub-section 'any person having furnished a return under sub-s. (1) or sub-s. (2)' may furnish a revised return at any time before the assessment is made if he discovers any omission or any wrong statement in the original return. The very fact that this right is given to a person who has filed a return under sub-s. (1) or sub-s. (2) of S. 139 means by necessary implication that such a right is denied to a person who files the return under sub-s. (4) of S. 139 of the Act. Clause (c) of sub-s. (1) of S. 153 employs both the expressions 'return' and 'revised return' and refers to both sub-ss. (4) and (5) of S. 139. Reasonably read it means the return filed under sub-s. (4) and the revised return filed under sub-s. (5) of S. 139 of the Act. It would not be reasonable to construe the said clause as indirectly conferring a right to file a revised return under sub-s. (4) which is not conferred directly by sub-s. (5) of S. 139 of the Act. For cl. (b) of sub-s. (1) of S. 153 to apply, the ITO must, within the period of four years (or whatever the applicable period of limitation) either initiate proceedings under s. 271(1)(c) or record his opinion that it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iginal return. As per the original return, the assessment was to be completed by 31st March', 1999 and the assessment was completed on 19th Feb., 1999. With regard to the case law in the case of Padma Timber Depot, the Hon'ble Andhra Pradesh High Court has held that a return filed by the assessee after the expiry of the time-limit specified under S. 139(1) of the Act is non est in law. It is not open to the Revenue to take note of such a return and proceed to make an assessment. Here, the original return filed under s. 139(1) of the Act was a valid return and the revised return was not a valid return and the same is non est. The AO has acted on the original return only. As far as revised return is concerned, the AO has taken as information to complete the assessment on original return. In view of these facts, the case law cited by the learned counsel for the assessee is not applicable to the present case in hand as the facts are entirely different and distinguishable. 10. Regarding another case law relied on by the assessee's counsel in the case of CIT vs. M/s. Ratanbai N.K. Dubash, the Hon'ble Bombay High Court has annulled the assessment on the ground of limitation and held as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r coparceners. The relevant portion of translated copy of partition deed dt. 11th March, 1976 is being reproduced from the assessee's paper book at p. 23 as under: "This document of family partition entered into on this 11th day of March, 1976 among (1) V. Ramakrishnan, son of Neerkondar Venkataswamy Naidu, residing at No. 765, Trichy Road, Ondiputhur, Coimbatore (2) R. Manohar (3) R. Vijayakumar both sons of V. Ramakrishnan and (4) minor R. Sureshkumar aged about 10 years by his father and guardian V. Ramakrishnan. Whereas we have been enjoying commonly all our family properties till to date. We have agreed to partition the said family properties in our own interest and as per the comprise made by the persons interested in our family. We have already divided among ourselves the movable properties belonging to our family. We agree that, the properties purchased in the individual names of parties No. 1, 2 and 3 and registered with the Registrar, Chithoor Taluk, Palakkad District in document Nos. 997 and 998 of 1964 shall be enjoyed by the respective parties and only in respect of the properties in Singanallur is to be partitioned in this deed. In respect of house properties, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipal Corporation Limits, Singanallur Village, S.F. No. 268 and extent of Ac. 0.34-1/2 cents together with half share in the well with rights of channel, North South East facing buildings thereon together with water tap, electricity service connection with right of pathway. Old Nos. 755A to 773 their new Nos. 228, 236, 238, 240, 241, 242, 758, 762, 763, 765, 766, 767." In this description the new number of the property has been described and the same property from which the assessee has declared the rental income which described as new No. 236 after 228. The claim of the assessee is that the income from house property declared in the revised return before the AO as well as the CIT(A) was of HUF. The CIT(A) in his order has admitted that the assessee has collected the rent from HUF property which was declared in the revised return due to inadvertence. The relevant portion of the order of the CIT(A) reads as under: "3.1 It is also submitted that the appellant was permitted by the HUF in which he is a member to collect certain rental income which he has admitted in the return and the appellant should not be denied the benefit of exemption under s. 54F. An affidavit has been also fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filing of suit before the Subordinate Judge on 23rd May, 1988 or on the date of decision of the Subordinate Judge on 8th March, 1996. The Revenue's case is that the property was partitioned by filing the suit before the Subordinate Judge. The Subordinate Judge has passed the order on 8th March, 1996 dividing the property into 4 equal shares and allotted one such share to each coparcener. Now, it is to be decided that as to whether the ownership of this property is described or not and whether the title is perfect or not. The ownership of the property is either vested or contingent. It is vested when the owner's title is already perfect and it is contingent, when his title is as yet imperfect, but is capable of becoming perfect on the fulfilment of certain conditions. If ownership is vested then it is absolute and if it is yet to be perfect on fulfilment of certain conditions, it is conditional. In the former case, the investitive fact from which it derives the right is complete in all its parts; whereas in the latter it is incomplete on the concept of vested and contingent ownership. The view very clearly has been explained in Salmond on Jurisprudence, 12th Edition written by P.J. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her it is owing to C or D. On the other hand, it may be that the right is contingent in respect of its existence, no less than in respect of its ownership. This is so whenever there is no alternative owner, and when, therefore, the right will belong to no one unless it becomes vested in the contingent owner by the fulfilment of the condition. It is to be noticed that the contingent ownership of a thing is something more than a simple chance or possibility of becoming the owner. It is more than a mere spes acquisitionis. I have no contingent ownership of a piece of land merely because I may buy it, if I so wish; or because peradventure its owner may leave it to me by his will. Contingent ownership is based not upon the mere possibility of future acquisition, but upon the present existence of an inchoate or incomplete title. The conditions on which contingent ownership depends are termed conditions precedent to distinguish them from another kind known as conditions subsequent. A condition precedent is one by the fulfilment of which an inchoate title is completed; a condition subsequent is one on the fulfilment of which a title already completed is extinguished. In the former case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not as a beneficial owner. In view of this discussion also, we are of the view that in the present case in hand, the assessee has only contingent right and at the most he may be termed as a beneficial owner. If we accept that he has declared the income from house property, in any case for claiming exemption under s. 54F of the Act, the assessee could not be put in jeopardy by treating him as the owner of the another residential house which vests not in him rather vests in the HUF till the decision of the appellate Court, i.e., Addl. District Court's order which is dt. 10th July, 1998. Here, we have to refer the case law of the Hon'ble apex Court in the case CIT vs. Podar Cement (P) Ltd. (1997) 141 CTR (SC) 67: (1997) 226 ITR 625 (SC) wherein the Hon'ble apex Court very beautifully considered the case law in the case of R.B. Jodha Mal Kuthiala vs. CIT (1971) 82 ITR 570 (SC) which is reproduced as it is: "The question is who is the 'owner' referred to in this section? Is it the person in whom the property vests or is it he who is entitled to some beneficial interest in the property? It must be remembered that s. 9 brings to tax the income from property and not the interest of a pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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