TMI Blog2005 (8) TMI 573X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee. Before the CIT (Appeals) it was contended that mutation was necessitated only on account of the change in the name of the company and not because the property was duly purchased. However, the CIT (Appeals) concurred with the Assessing Officer and confirmed the disallowance. 3. The contention of the learned counsel was the same as it was before the CIT (Appeals) and the learned DR relied on the orders of the lower authorities. 4. On due consideration of the matter, we direct the Assessing Officer to allow the claim of the assessee. It is evident from the record that the property in question was purchased by the assessee long back and the allotment/lease deed was executed on 4-6-1982. The earlier name of the company was Singh Enterprises (Exports) Ltd. The name was changed to Wimco Exports Ltd. with effect from 10-5-1993. Thus, the property was already owned by the assessee in its own erstwhile name, but since it was applying for a loan from the bank, the change in the records was necessary. Therefore, the mutation was not in connection with the acquisition of the property but it was only on account of the change in the name of the company and hence the expenses are of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich the return on investment was purported to be allowed as per the tripartite agreement. This was worked out at Rs. 2,79,32,903 and was added as the income of the assessee. 8. The CIT (Appeals) noted that the tripartite agreement was dated 25-3-1997 which was relevant to assessment year 1997-98. He further noted that out of the total 75 acres of land acquired from VTPL was apportioned as 36 acres belonging to Wimco Ltd. and 39 acres belonging to the assessee. Therefore, he was of the view that the total return on investment of Rs. 650 lakhs had to be apportioned between Wimco Ltd. and the assessee. Accordingly, he upheld the view of the Assessing Officer that Rs. 2,79,32,903 was the income attributable to the assessee. However, considering the fact that it had accrued in the year relevant to assessment year 1997-98, he directed the Assessing Officer to delete the addition from the total income of the year under consideration. Finally, the CIT (Appeals) remarked, "accordingly, the Assessing Officer is to consider and assess the said income in the relevant assessment year mentioned and the inclusion in this year is to be dropped". 9. The learned counsel appraised us of the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty. He relied on the following judgments : 1. CIT v. Vikram Cotton Mills Ltd. [1988] 169 ITR 597 (SC); 2. CIT v. K.K. Kochammed [1993] 199 ITR 200 (Ker.); and 3. CIT v. Golcha Properties (P.) Ltd. [1997] 227 ITR 391 (Raj.). With regard to the other claim of the assessee that the CIT (Appeals) could not have given any direction with regard to assessment year 1997-98, it was submitted that it was not a clear direction given by the CIT (Appeals) and hence the observation need not be deleted. 11. We have duly considered the rival contentions and the material on record. The judgment of the Rajasthan High Court relied upon by the learned DR has no application to the facts of the present case because the facts in that case are totally on a different footing. Likewise, the judgment of the Kerala High Court also stands on its own facts and in fact if at all it is applicable, it supports the case of the assessee whose facts are on a stronger footing than the facts in the case before the Kerala High Court. The judgment in the case of Vikram Cotton Mills Ltd. ( supra ) has been relied upon by the learned DR to contend that the conduct of the parties also need to be seen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cape its liability to be taxed on the income earned from the impugned property. This aspect has been explained by the Supreme Court in the case of CIT v. Podar Cement (P.) Ltd. [1997] 226 ITR 625 by invoking the doctrine of updated construction. Thus, we are of the confirmed view that the entire income of Rs. 650 lakhs belonged to Wimco Ltd. and no part of it can be assessed in the hands of the assessee-company. The addition has to be deleted on this ground. In the passing, we may take note of the decision of the Tribunal in the assessee s case for assessment year 1996-97 in I.T.A. No. 2719/Del./2000 dated 26-4-2004. This appeal was altogether on a different issue but there also the Tribunal has taken note of the fact that the assessee had purchased the land out of the funds arranged by Wimco Ltd. Thus, for all purposes, Wimco Ltd. is the owner of the entire land of 75 acres. 12. Now we come to the other argument of the learned counsel regarding the purported direction of the CIT (Appeals) to tax the above income in assessment year 1997-98. As such, since we have already held earlier that the income does not belong to the assessee and hence cannot be taxed in its hands, ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disposal of the case before the authority or court. It must also be a direction which the authority or court is empowered to give while deciding the case before it. The expressions "finding" and "direction" in section 153(3)( ii ) of the Act must be accordingly confined. Section 153(3)( ii ) is not a provision enlarging the jurisdiction of the authority or court. It is a provision which merely raises the bar of limitation for making an assessment order under section 143 or section 144 or section 147 : ITO v. Murlidhar Bhagwan Das [1964] 52 ITR 335 (SC) and N.K.T. Sivalingam Chettiar v. CIT [1967] 66 ITR 586 (SC). The question formulated by the Tribunal raises the point whether the AAC could convert the provisions of section 147(1) into those of section 153(3)( ii ) of the Act. In view of section 153(3)( ii ) dealing with limitation merely, it is not easy to appreciate the relevance or validity of the point." From the above, it is evident that in the present case the CIT (Appeals) had to give a finding in respect of assessment year 1997-98 in order to dispose of the matter for assessment year 1998-99 which was before her. However, whether this finding necessarily amounts ..... X X X X Extracts X X X X X X X X Extracts X X X X
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