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The Commissioner of Income Tax-11 Versus M/s. Goodwill Theatres Pvt. Ltd.

2016 (6) TMI 534 - BOMBAY HIGH COURT

Mesne profits - capital or revenue receipt - whether the Tribunal was correct in holding that mesne profits, cannot be part of book profit u/s. 15JB, as it was held as capital assets? - Held that:- The Special Bench of the Tribunal in Narang Overseas Pvt. Ltd., (2008 (2) TMI 817 - ITAT MUMBAI ) held that the same is capital in nature. There is no doubt that the issue arising herein is also with regard to the character of mesne profits received by the RespondentAssesse. In this case also, the amo .....

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nch of the Tribunal in Narang Overseas Pvt. Ltd., (supra) The least that is expected of the State which prides itself on Rule of Law is that it would equally apply the law to all assessees's. No substantial question of law. - Decided against revenue - Income Tax Appeal No. 2356 of 2013 - Dated:- 6-6-2016 - M. S. Sanklecha And A. K. Menon, JJ. For the Appellant : Mr. P. C. Chhotaray For the Respondent : Dr. K. Shivram, Sr. Advocate with Mr. Rahul Hakani i/b. Neelam Jadhav ORDER P. C. This Appeal .....

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on the facts and in the circumstance of the case and in law, the Tribunal was correct in holding that mesne profits, cannot be part of book profit u/s. 15JB, as it was held as capital assets? . 3. The impugned order of the Tribunal has held that the mesne profits received by the Respondent-Assessee for the unauthorized occupation of its premises from Central Bank of India is a receipt of capital nature and thus not taxable. To reach the above conclusion, the impugned order placed reliance upon t .....

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ssession of such property actually received or might with ordinary diligence have received therefrom, together with interest on such profits, but shall not include profits due to improvements made by the person in wrongful possession. On the basis of above, it held that any amount received from a person in wrongful possession of its property, would be mesne profits and it is capital in nature. 4. This appeal was on board on 14th January, 2016. At that time, it was pointed out to us that the Reve .....

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h in Narang Overseas Pvt. Ltd., (supra), has been restored to the file of this Court. Further, the Revenue was directed to put on record the reason why the Revenue seeks to challenge the impugned order in the face of the order of the Special Bench of the Tribunal in Narang Overseas Pvt. Ltd., (supra) which appears to be undisturbed. 5. Today, when the Appeal was called out, Mr. Chhotaray, learned Counsel appearing for the Revenue on instruction states that till date no proceedings had been filed .....

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it seeks to press this appeal. This is particularly so in the face of having accepted the order of the Special Bench of the Tribunal in Narang Overseas Pvt. Ltd., (supra). 7. We had in Director of Income Tax (International Taxation) v/s. Credit Agricole Indosuez ITR 102 377observed as under: (v):…. …. …. …. …. …. …. In matters of tax, justice requires that there must be certainty of law which presupposes equal application of law. Thus, where the .....

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ld file an affidavit pointing out the reasons for filing the appeal. It is only when the court is satisfied with the reasons given, that the merits of the issue need be examined of purposes for admission (please see I.T.A. No.37 of 2013 CIT v. Proctor and Gamble Home Products Ltd., dated January 19,2015 [2015] 377 ITR 66 (Bom); I.T.A. No.269 of 2013 CIT v. SBI dated February 4, 2015 [2015] 375 ITR 20(Bom); I.T.A. No. 330 of 2013 DIT v. Citibank N. A. dated March 11, 2015 - [2015] 377 ITR 69 (Bom .....

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n of the Special Bench of the Tribunal in Narang Overseas Pvt. Ltd., (supra) will not apply as the facts in this case are different. Mr. Chhotaray points out that landlordtenant relationship as arising in the present case was not present in Narang Overseas Pvt. Ltd., (supra). Thus, he submits that this appeal needs to be admitted. 10. We find that the issue before the Special Bench of the Tribunal in Narang Overseas Pvt. Ltd., (supra) was to determine the character of mesne profits being either .....

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