TMI Blog2015 (6) TMI 768X X X X Extracts X X X X X X X X Extracts X X X X ..... 1973. The impugned order on the basis of the clear provisions found in Section 2(11) and 15A of the Rent Control Act concludes that the Respondent Assessee is a deemed tenant of the subject premises. In fact, Section 15A of the Rent Control Act, inter alia, provides that notwithstanding anything to the contrary in any contract, where a person is in occupation of the premises on 1st February, 1973, he shall be deemed to have become the tenant of the landlord in respect of the premises or part thereof, in his occupation. Thus, it follows that if the owner of the subject premises were to seek eviction of the Respondent Assessee on the basis of the contract, it would fail in view of the clear position in to Section 15A of the Rent Control A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee has not termed as tenant as per the Maharashtra rent control act? (b) Whether in the fact and circumstances of the case and in law, the tribunal was justified in holding that amount received by assessee on account of transfer of capital assets occupied by assessee within the meaning of capital gain even otherwise the deed of surrender of tenancy stated that it is a compensation in connection with loss of business, profit and convenience and hardship due to shifting elsewhere? 3. Briefly the facts leading to this appeal is that Respondent Assessee had entered into an agreement dated 13th June, 1972 with one M/s. Modern Textiles and Silk Mills Private Limited (Modern) for use of looms and machinery in the subject premises and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emed tenancy of premises in occupation of any person as on 1st February, 1973. On the above basis, the Tribunal concluded that surrender of occupation was surrender of tenancy i.e. capital asset and the amounts received was taxable under the head 'Capital gains' and not under the head 'Income from other sources'. Section 15A of the Rent Control Act provides that a person in occupation of the premises shall be deemed to be a tenant in respect of premises in its occupation. 5. For proper appreciation of the impugned order and the grievance of the Appellant Revenue, it would be useful to reproduce Sections 5(11) and 15A of the Rent Control Act which reads as under: Section 5 (1) to (10):- (11) 'tenant' means any p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operation of subsection (1) of section 15 after the date aforesaid. 6. The grievance of the Appellant Revenue is that the Respondent Assessee cannot be considered to be a tenant of the subject premises, thus the giving up of occupation by it was not a surrender of capital assets. This on the basis that the Agreement dated 13th June, 1972 entered into by the Respondent Assessee clearly provided that it had rights only to the looms and machinery and use of the subject premises was only incidental. The Agreement dated 13th June, 1972 in terms also provided that license to use the premises will not be construed as sublease in any form. Therefore, it is submitted that Sections 5(11) and 15A of the Rent Control Act would not be of any avail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emises. Consequently, such tenancy being property would be a capital asset and amounts received on surrender of it would be capital receipts chargeable to tax under the head 'Capital gains.' The issue of tenancy being a capital asset is no longer res integra as the Apex Court in CIT v/s. D. P. Sandu Bros. Chembur 273 ITR 1 has upheld the view of this Court in Union of India v/s. Cadell Weaving Mill Co. 249 ITR 265 wherein it has been held that tenancy right was a capital asset and surrender of the same was a transfer of a capital asset. 8. In view of the selfevident and settled position in law, this appeal does not raise any substantial question of law, to be entertained. 9. Accordingly, appeal dismissed. No order as to costs. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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