TMI Blog1993 (7) TMI 140X X X X Extracts X X X X X X X X Extracts X X X X ..... cipal and interest and obtained a decree from the High Court, Calcutta. The assessee paid the principal and had the decree assigned in its name. Thereafter, the owner of the property granted a lease of the property for 33 years on 25th December, 1968 in consideration of the interest payable on the loan. In the previous year ended 31-5-1982 corresponding to the assessment year 1983-84, the owner sold 8 grounds out of the 22 grounds of land. Since the assessee had leasehold rights for the remaining period of 17 years, the purchaser of the property gave the assessee a sum of Rs. 1,50,000 for surrendering that leasehold right. The assessee claimed that this was a capital receipt and since there was, no cost of acquisition, it was not liable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso a case where a tenancy right of a godown had been surrendered and the claim was made that the capital gains cannot be brought to tax. However, the Allahabad High Court held that the amount could be characterised as a casual and non-recurreing receipt and since it is not exempt under section 10(3), proviso (i), it will be taxable under that section. It was submitted that since the facts of this case are similar to that case, the capital gains which cannot be taxed under section 45 must be taxed under section 10(3). This was resisted by the assessee by pointing out that section 10(3) is not a charging section but in fact an exempting section. It was submitted that what otherwise would be chargeable would be exempt under section 10(3) if i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade the Central Board will no doubt consider the same sympathetically and expeditiously." It was submitted that if the amounts were otherwise taxable, the Supreme Court would not have made those observations. 7. We have carefully read the decisions of the Supreme Court and the Allahabad High Court. We find that the Allahabad High Court, which decided the case on 4th March, 1991, did not have the benefit of the Supreme Court judgment given on 21st August, 1991. It is not disputed by the revenue that the receipt was a capital receipt and was not of an income nature. A capital receipt can be taxed as deemed income only if it falls under section 45. This basic fact is probably the reason why the Supreme Court had in the case of A. Gasper di ..... X X X X Extracts X X X X X X X X Extracts X X X X
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