TMI Blog2016 (3) TMI 600X X X X Extracts X X X X X X X X Extracts X X X X ..... 8. By an order dated 25th November, 2004 the appeal was admitted on the following substantial questions of law:- I) When the learned Members of the Tribunal themselves recorded that they refrain from commenting on the direction of the learned CIT (Appeals) on the issue of admissibility of deduction under Section 54 of the I. T. Act which the Revenue has not agitated before the Tribunal was justified in allowing the appeal on the issues raised by the Revenue and in reversing the order of the CIT(Appeals) on the said issues and in doing so whether the Tribunal acted perversely? II) Whether the Tribunal failed to appreciate that the Divorce petition and/or decree read with other agreements and/or documents clearly establish the intention of the parties therein that the assessee was a co-owner of the property in question providing 50% of the consideration for acquiring the said property and/or by virtue of mutual agreement the ex-husband of the assessee parted with 50% of the property in question in favour of the assessee by way of alimony and as such Section 49(1)(iii) of the I.T. Act will be applicable and whether the Tribunal was justified in holding that 50% of the cost ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a flat situated at 9, Mandeville Gardens, Calcutta and that she was a co-owner of the said matrimonial house, having 50% share therein. The assessing officer deputed an inspector to verify the claims. Relying upon a report filed by the inspector the assessing officer held by his order dated 28th March, 2001 that Mr. D. Chowdhury, the exhusband of the assessee was the exclusive owner of the flat at 9, Mandeville Gardens and the assessee was his nominee. The assessing officer also observed that since the flat at 9, Mandeville Gardens was owned exclusively by the former husband of the assessee and the sale proceeds from the said property were utilized to purchase the matrimonial house at 25, Mandeville Gardens, therefore the former husband of the assessee was the full owner of the newly purchased matrimonial house. The assessing officer on the aforesaid basis held as follows:- In the circumstances, the assessee could not get the benefit of cost of acquisition u/s 48 of the I.T. Act, 1961, as she did not contribute any investment to purchase the flat at 25, Mandeville Gardens, Calcutta. In Section 49(2) it was cleared that the self generated acquired property s cost o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In the case before us the divorce resulted in mutual agreement of a decree and the marriage between the husband and wife was dissolved by decree of dated 12.1.94. Nowhere in this decree could the property be said to have been acquired by the assessee as a co-owner and neither have the intentions of the erstwhile husband wife team had ever suggested the same. The facts as brought out by the A.O. clearly indicate the intention of the parties hereto inasmuch as the occurrence of divorce resulted in splitting the sale consideration and the rent received if let out to be split during the intervening period .We are unable to convince ourselves that the assessee who did not participate in the acquisition of the said property and was merely a nominee in the happier days could get the liability of the cost of acquisition subsequent to divorce for which she never contributed. The word devolution has to be understood in the manner it was for the purpose of changing hands from one owner to another even inter vivos without disturbing the status of the entity which becomes owner thereof without having to undergo corresponding devolution. In other words, the assessee in this case having part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in a lump sum under the decree to the assessee, a larger monthly sum would have been awarded to her on account of alimony. It is not as if the payment of ₹ 25,000 can be looked upon as a commutation of any future monthly or annual payments because there was no pre-existing right in the assessee to obtain any monthly payment at all. Nor is there anything in the decree to indicate that ₹ 25,000 were paid in commutation of any right to any periodic payment. In these circumstances, in our view, the receipt of that amount must be looked upon as a capital receipt. In view of this, we do not think it necessary to consider whether the said receipt could be regarded as casual receipt or in the nature of a windfall. Ms. Asha Ghutghutia learned counsel appearing on behalf of the revenue contended that the Tribunal did not hold that the 50% of the sale consideration given to the wife was on account of alimony. We are not impressed by the submission advanced by the learned counsel for the revenue. The Tribunal has categorically held that:- It was on account of alimony that the husband mutually agreed to part with 50% thereof as is noted in the decree of divorce dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. Although no such alternative claim was made in the plaint, the Privy Council allowed it to be advanced and gave a decree on the ground that the respondent could not be prejudiced by such a claim at all and the matter ought not to be left to a separate suit. It may be noted that this relief was allowed to the appellant even though the appeal was heard ex parte in the absence of the respondent. When the revenue did not prefer any appeal against the finding of the learned Tribunal that the payment was on account of alimony the revenue must be deemed to have been satisfied by such finding. Reference in this regard may be made to a Division Bench judgement of the Bombay High Court in the case of Motor Union Insurance Co. Ltd. vs- Commissioner of Income Tax, Bombay, reported in (1994) 13 ITR 272, wherein the following views were expressed:- Apart from statute, it is elementary that if a party appeals, he is the party who comes before the Appellate Tribunal to redress a grievance alleged by him. If the other side has any grievance, he has a right to file a cross appeal or cross-objections. But if no such thing is done, the other party, in law, is deemed to be satisf ..... X X X X Extracts X X X X X X X X Extracts X X X X
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