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2018 (4) TMI 1415 - AT - Income TaxIncome from sale of land - Long term capital gain or income from other sources - land leased out - Held that:- By the lease deed dated 11.07.1972 lease of the land in question was granted to SSL. The contention of the A.O. that transfer of land for such a long period is nothing but actual transfer of the said land cannot be accepted because by giving of lease, the said plot of land, the assessee has not lost its ownership right over the said plot of land. In our considered opinion, the land which had been leased out to SSL did not seize to belong to the assessee. The ownership remained with the assessee. When the Official Liquidator appointed by the Hon’ble High Court of Gujarat sold the land held by SSL on lease, the assessee filed application before the Hon’ble High Court for recovery of possession of land in question. The Hon’ble High Court of Gujarat held that lease right are intangible asset and therefore what Official Liquidator has transferred was the lease right held by the lessee company. The Official Liquidator has sold the land on “ as is where is and whatever there is basis”. The law is very clear on this issue- “no one can transfer a better title then what it has”. The purchaser would have got a lease held right over the said plot of land and to get the ownership right ₹ 3.11 crores was paid to the assessee and vide agreement dated 04.09.2009 deed of confirmation and release was executed for release of ownership rights of the land under reference. J.K. Kashyap [2008 (3) TMI 10 - HIGH COURT OF DELHI] has decided a similar issue holding that consideration received for relinquishing the rights in property attracted provisions of section 45(1) making it liable to capital gains tax. Addition for scheme for gratuity - Held that:- From a bare reading of Section 36(1)(v) of the Act, it is manifest that the real intention behind the provision is that the employer should not have any control over the funds of the irrevocable trust created exclusively for the benefit of the employees – deduction allowed since the conditions stipulated in Section 36(1)(v) of the Act were satisfied. See Textool Company Ltd case [2009 (9) TMI 66 - SUPREME COURT]
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