TMI Blog2010 (4) TMI 712X X X X Extracts X X X X X X X X Extracts X X X X ..... 48 - sale value - AO considering the value of super structure to determine the sale value and compute the capital gain - CIT(A) directed AO to consider the sales consideration as per value of the land adopted by the Registrar for Stamp Duty purpose on the date of registration of the development agreement - Held that: - the consideration for the transfer of capital asset is what the transferer receives in lieu of the assets – order of CIT(A) reversed - Decided in favour of revenue. - ITA Nos. 6, 7 & 67 to 70/Hyd/2010 - - - Dated:- 30-4-2010 - SHRI G.C. GUPTA, VICE PRESIDENT AND SHRI CHANDRA POOJARI ACCOUNTANT MEMBER Appellant by: Shri B. Senthil Kumar, CIT- DR Respondent by: Shri K. Vasant Kumar,Advocate ORDER Per Bench These six appeals preferred by the Revenue are directed against different orders passed by the CIT(A) VI, Hyderabad and pertains to assessment years 2005-06 and 2006-07. Since common issues are involved in all these appears they are clubbed together, heard together and disposed of vide these common order for the sake of convenience. 2. The first common ground in all these appears are that the CIT(A) erred in holding the income received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ived as its share in lieu of the land forgone by them. Since the land owner has relinquished his rights on the land forgone, the assessing officer treated it as a transfer u/s 2(47) of the Income Tax Act. Accordingly, capital gain was computed. Regarding the applicability of S.2(47), there is no dispute. However, considering the value of sales consideration, according to the assessee, the market value of the land as to the date of the transfer is to be considered instead of considering the value of super structure. The assessing officer not agreed with this proposition and he placed reliance on the order of the Delhi Bench ITAT, in the case of Smt. Vasavi Pratap Chand Vs. DCIT (89 ITD 73) and considering the value of super structure to determine the sale value and compute the capital gain. Further, against this the assessee went in appeal before CIT (A) and CIT(A) directed the assessing officer to consider the sales consideration as per value of the land adopted by the Registrar for Stamp Duty purpose on the date of registration of the development agreement. Since it is not possible to ascertain the sales consideration at the time of development agreement, as the transfer was in l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and melamine polished. Telephone and all cables concealed. Discussion tables 10 capacity made with ply and laminated with veneer and melamine polished. Telephone and all cables concealed. Chairs Good quality cushioned chairs of Himg tie/Euro make Air conditioning Air conditioning units will be with chillers blue star/carrier make Air conditioning in network room and hub rooms Separate precision AC will be provided and designed to achieve 18 deg C with 100% backup False ceiling A mixture of Armstrong grid ceiling and Gyp Board false ceiling Lighting 2 x 36w CFL 2 x 2 lighting fixture of Wipro/Phillips make LAN Done with CAT 6 cable of Lucent/Amp make Fire fighting Detectors in all areas with gas flooding system/fire existinguishers etc. in appropriate areas Cafeteria Fiber sheets on MS structure with Granite flooring and false ceiling. Tables and chairs of featherlite make with required with fittings for service and kitchen for the entire complex and to be used commonly by all the building owners. DG set Sound proof DG sets with 100% backup UPS Battery 2 Nos. of the UPS as required for 100% backup for computers only Transformer Full capacity transformer with all required control ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcial building (d) . The building itself is the amenity being provided here and that is why the agreement for lease of amenities prescribes the lese amount in terms of sq.ft Rs.15 per sq.ft. per month, which is the same rate at which the property lese was also agreed upon. Without these amenities, the bare building is of no use, which is a common feature in any property. For a property to be used as residential certain kinds of same amenities and fixtures would be required or else people cannot inhabit it such as kitchen, ventilations, electrical fittings etc. and the same goes for a commercial property without some amenities such as provision for air conditioning and cabins, it cannot be useful for any purpose. Therefore, just because there is something beyond the bare structure that is being provided, it cannot be said that these amenities are not part of the property itself. However, since these amenities are not separate assets such Plant and Machinery, the provisions of sec.56(2) do not apply here. In our opinion, though the assessee entered separate agreement, these agreements cannot be acted upon as foolproof documents. When the apparent is not real, we have to see t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noring the apparent has to be and has always been conceded. In this circumstance, the assessing officer has to remove the fa ade to expose the real intention of the parties cleverly cloaked and the actual agreement cannot be given effect. The only bona fide document to be acted upon not otherwise. There is a serious doubt and also it is shocking the conscious of the Bench, whether the assessee is getting hire charges equal to the rental amount for providing amenities. It cannot be real one and assessing officer required to see the actual rental value of the property in that place and bring that amount into tax under the head income from house property. As such, in the present case, the assessing officer came to the correct conclusion that real rental value was bifurcated into two separate income viz., one is rental income of house property and another is hire charges of the equipment. Further, in the case of letting of the machinery, plant or furniture, sec.56(2) (iii) of the Act is applicable, but only letting of building with certain amenities, this provision is not applicable and in that event, the income from letting out was chargeable under the head income from house prope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be held that the rental would not have been realized but for the letting out of the machinery, plant or furniture along with such building and therefore, rental received for the building is to be assessed under the head income from other sources . In the present case, on the facts of the case, it is clear that the assessee as the owner of the building was only exploiting the property as owner by letting out the same and realizing income by way of rent. Such rental income was liable to be assessed under the head income from house property. The various assets let out to the tenants are incidental to letting out the building being integral part of the letting. Accordingly, we reverse the order of the CIT(A) and restore that of the assessing officer. This ground of the revenue is allowed. 10. The next common grounds in ITA Nos.6, 7 69/Hyd/2010 is regarding determining of the sales consideration u/s 48. The learned counsel for the assessee submitted that this issue is covered in his favour by the order of this Tribunal dt.9-6-2006in the case of Smt.Shanta Vidyasagar Annam, Hyderabad in ITA No.885/Hyd/2003 for the assessment year 1997-98. We have carefully gone through this decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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