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Jitendra Kumar Soneja Versus Income Tax Officer, Ward 6 (3) (3) , Mumbai

2016 (8) TMI 1087 - ITAT MUMBAI

Nature of receipt in the hands of the assessee - corpus fund received - Held that:- Consideration for which the amount has been paid by the developer are, therefore, not relevant in determining the nature of receipt in the hands of the assessee. In view of these discussion, assessee could not be said to be of revenue nature, and, accordingly, the same is outside the ambit of income under section 2(24) of the Act. The impugned receipt ends up reducing the cost of acquisition of the asset, i.e. fl .....

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elopment activity of the project was taken place. So, Assessing officer is directed to allow the claim of assessee to same extent because it is nothing but compensation received by assessee for paying rent. This cannot be said to be income of assessee. Assessing Officer is directed accordingly. - ITA. No. 291/Mum/2015 - Dated:- 12-8-2016 - SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER For The Appellant : Shri Subhash Chhajed and Sunil T. Vankawala A.R. For The Respondent : Shri Chandra Vijay, D.R .....

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come as income from other sources amounting to ₹ 22,00,000/-. 3. On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) has erred in confirming the addition to the total income as income from other sources amounting to ₹ 8,55,800/-. 2. At the outset of hearing, ld. Authorized Representative did not press ground no.1. So, this ground is dismissed as not pressed. 3. The main issue is with regard to addition to the total income as income .....

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he head Income from other sources , which was confirmed by CIT(A). 3.1 Regarding addition of ₹ 22 lacs as income from other sources, ld. Authorized Representative drew my attention to page no.17. The stand of assessee has been that Assessing Officer made addition of ₹ 22 lacs received as corpus fund was received towards hardship caused to assessee on redevelopment and as such receipt was in the nature of capital receipt and as such not taxable. Ld. Authorized Representative drew my a .....

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ns of the Income tax Act. Section 2(24)(vi) provides that income includes any capital gains chargeable under section 45 , and, thus, it is clear that a capital receipt simplicitor cannot be taken as income. Hon ble Supreme Court in the case of Padmraje R. Kardambande vs CIT (195 ITR 877) has observed that ..,, we hold that the amounts received by the assessee during the financial years in question have to be regarded as capital receipts, and, therefore, (emphasis supplied by us), are not income .....

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receipt and revenue receipt. It is not even the case of the Assessing Officer that the compensation received by the assessee is in the revenue field, and rightly so because the residential flat owned by the assessee in society building is certainly a capital asset in the hands of the assessee and compensation is referable to the same. As held by Hon ble Hon ble Supreme Court Court, in the case of Dr. George Thomas K vs CIT(156 ITR 412), the burden is on the revenue to establish that the receipt .....

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g it s nature in the hands of the recipient. As observed by Hon ble Supreme Court in the case of CIT vs. Kamal Behari Lal Singha (82 ITR 460), it is now well settled that, in order to find out whether it is a capital receipt or revenue receipt, one has to see what it is in the hands of the receiver and not what it is in the hands of the payer . The consideration for which the amount has been paid by the developer are, therefore, not really relevant in determining the nature of receipt in the han .....

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