Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2020 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (2) TMI 265 - AT - Income TaxCapital gain - transfer of leasehold rights by the assessee - HELD THAT:- Having gone through the definition of capital assets we note that capital asset is property of any kind held by the assessee. In this case of M/s STP Limited (assessee) is holding lease rights in the property and the assessee has transferred these lease rights in favour of M/s ARA Enterprises Pvt. Ltd. and received the lumpsum amount. Therefore, it falls in the definition of property of any kind held by an assessee and hence subject to capital gain tax. We note that the explanation to Section 2(14) of the Act clearly says that the property includes and shall be deemed to have always included any rights in or in relation to an Indian company, including rights of management or control or any other rights whatsoever. In the assessee’s case under consideration, the assessee transferred his lease hold rights in favour of M/s ARA Enterprises Pvt. Ltd and these lease rights fall in the category of ‘any other rights whatsoever’. We note that M/s. ARA Enterprises Pvt. has paid ₹ 2,24,00,000/- on 31.03.2010 and balance amount of Ltd. arrear of ₹ 1,32,63,433/- has been paid during the year. These two amounts are basically the consideration for transfer of Leasehold Rights. Thus ₹ 3,56,63,433/- is the consideration for restoration and subsequent transfer of Leasehold Rights. Besides during the current year, M/s. ARA Enterprises Pvt. Ltd. has also paid 50% of the rent payable to Kolkata port Trust. However, this is in the nature of revenue receipt and assessee would keep receiving such income in subsequent years. Assessee has not provided the details of amount, if any, which it might have paid for acquiring the Leasehold Rights. Amount paid if any, would not be much as it was acquired a long time back. Cost of acquiring Leasehold Rights is almost Nil. Hence entire amount of ₹ 3,56,63,433/- is taken to be Long Term Capital Gain of the assessee and income is enhanced by this amount by ld CIT(A) Therefore, having gone through the provision of Section 2(14) and Section 2(47) of the Act, it is evidently clear by reading of these sections, that the assessee has transferred lease hold rights in favour of M/s ARA Enterprises Pvt. Ltd. which is transfer as per Section 2(47) of the Act, therefore, the ld. CIT(A) has rightly computed the capital gain and hence, we confirm the order of the ld. CIT(A). Undisclosed income from license fee - HELD THAT:- We note that it is not clear whether the said amount was paid in pursuance of the agreements between assessee and its sub-lessee in view of the commercial expediency. Since the assessee has failed to prove the commercial expediency therefore we confirm the order passed by the ld. CIT(A).
|