TMI Blog2005 (5) TMI 50X X X X Extracts X X X X X X X X Extracts X X X X ..... t under section 281B of the Income-tax Act, 1961, while doing so the petitioner has also challenged an order dated October 12, 2001, passed by the Commissioner of Income-tax, Central II, Calcutta, in purported compliance with the orders dated August 7, 2000, and August 22, 2001, passed in the previous writ petition being numbered (WP) 1456 of 1997. The facts of the case, which lead to filing of the instant application, are stated hereunder: The first petitioner entered into an agreement dated April 29, 1997, with respondent No. 9 for purchase of two flats on the first and second floors of the premises No. P-360/2, Keyatala Road, Kolkata, covering approximately an area of 3,500 sq. ft. and half of the ground floor including common facilities, etc., on the terms and conditions contained in the said agreement at a consideration of Rs. 21,50,500. At the time of signing of the said agreement the first petitioner duly paid the entire consideration of the said property and possession of the same was handed over on May 7, 1997, by respondent No. 9. The petitioners after having entered into an agreement as above and taken possession, engaged security agency to look after the said proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wnership of the said property in question has not been transferred by executing a registered deed of conveyance respondent No. 9 cannot be said to have ceased to be the owner and the petitioner has not acquired any title in the property. It was further observed by the Commissioner that the petitioner had not taken possession of the same and this was found upon inspection by the competent official of the Revenue who has submitted a report. Mr. A.K. Mitra, learned senior counsel appearing with Mr. J.P. Khaitan, the learned advocate in support of the writ petitioners contends that all the orders, namely, provisional order of attachment dated May 30, 1997, order of extension passed by the concerned officials and approved by the Commissioner, final attachment order and lastly order dated October 12, 2001, are bad in law as the same were passed on erroneous application of the law. He submits that under the provision of section 27, clause (iiia) of the said Act the petitioner has become the owner of the aforesaid flats in question. All the conditions for becoming deemed owner mentioned in clause (iiia) of the said section have been fulfilled as the petitioner has entered into an agreeme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as regards possession that it is not necessary, in order to establish possession, that one has to establish the fact of physical possession. In support of his contention he has relied on the text of Halsbury's Laws of England 4th Edn., Vol. 35, page 732. While replying to the argument as to maintainability of the writ petition he contends that since it is a question of breach of principles of natural justice and the erroneous application of law this court as a matter of course will entertain the writ petition. Mr. S.K. Kapoor, learned Additional Solicitor General, opposes this application contending that this writ petition is not maintainable as the issues involve disputed questions of fact and this has been observed by the hon'ble Mr. Justice P.C. Ghose in his Lordship's order dated August 7, 2001. These findings and observation of his Lordship have not been challenged as such the same is binding. No additional material has been placed before this court other than what was placed at the time of dismissal of the previous writ petition on August 7, 2001. His Lordship was very categorical that the petitioner would have to file a suit to establish its title to the property. In any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e found that the writ petitioner has not been in possession to get advantage of the provisions of section 2(47), sections 22 and 32 of the said Act. He has also found that the electric supply line, Corporation records, still stand in the name of respondent No. 9. He has held that even if it is treated as a transfer then such transfer is invalid and illegal by reason of the provision of section 281 of the said Act. Before I examine the impugned order and also order of attachment, I feel it expedient to decide the question of entertainability of the writ petition on the plea of disputed question of fact and also existence of alternative remedy. The principles and guidelines for entertaining the writ petition are already authoritatively laid down by the hon'ble Supreme Court as well as this court, following these guidelines I am of the opinion that it is for the writ court to examine in its wisdom whether the nature of disputes involved in the writ petition are such as can conveniently be decided in a writ jurisdiction or not. Obviously the writ court will not entertain the writ petition canvassing a dispute that can appropriately be raised in a civil suit involving elaborate witn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by both the contending parties. Here the issue of possession has been decided without considering the materials placed and produced by the writ petitioner. Thus, the basis of the findings on the issue of possession is not judicially acceptable because physical possession of the property in question is not solely determinative in a case of this nature. I find there is substance in the argument of Mr. Mitra that possession of the property can be presumed from such an act and action of the parties as the nature of the property admits. The real test of possession is an intention of possessing together with that amount of occupation or control of the entire subject-matter of which it is practically capable and which is sufficient for practical purposes to exclude the stranger from interfering. This proposition of law is supported and based on Halsbury's Laws of England, 4th edition, Vol. 35. The above text has also been approved and accepted by the hon'ble Supreme Court in a case reported in B. Gangadhar v. B.R. Rajalingam [1995] 5 SCC 238: "... Halsbury's Laws of England, IVth edition, Volume 35, in para. 1214 at page 735, the word 'possession' is used in various contexts and phra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng to" mentioned in section 281B have to be read and understood in the context of the definition of "transfer" provided elsewhere in the said Act itself. The definition of the word "transfer" as provided in section 2(47) of the aforesaid Act provides as follows: "(v) any transaction involving the allowing of the possession of any immovable property to be taken or retained in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882 (4 of 1882)..." This definition has been incorporated into the aforesaid Act by the Finance Act, 1987, with effect from April 1, 1988. The subject transaction took place in or about April 24, 1997, but the above judgment dealing with the Wealth-tax Act relied on by the Revenue was rendered on October 21, 1986. In view of the expressed provision of the transfer in the statute, the above judgment is of no assistance. The Commissioner has overlooked this relevant and appropriate aspects, this ought to have been taken into consideration. Again the definition of "house and property" has been given in section 27 of the said Act for the purpose of sections 22 to 26 this has been provided amongst others a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded over possession under the contract. The transferor in a case where he has executed the document and received consideration and even handed over possession of the property, cannot exercise any right of an owner. Their Lordships further held that the above meaning in the Income-tax Act is clarificatory and therefore, retrospective in operation. In the case of Mysore Minerals Ltd. v. CIT reported in [1999] 239 ITR 775, the apex court relying on the aforesaid decision of the same court rendered in Podar Cement Pvt. Ltd. case [1997] 226 ITR 625 held that a person who had taken possession and made payment of the consideration was the owner for grant of depreciation allowance though he had not obtained the deed of conveyance. I think it would be apposite to quote the relevant portion of the observation of Justice Lahoti (as his Lordship then was) who spoke for the Bench at page 780: "In our opinion, the term 'owned' as occurring in section 32(1) of the Income-tax Act, 1961, must be assigned a wider meaning. Anyone in possession of property in his own title exercising such dominion over the property as would enable others being excluded therefrom and having the right to use and o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eclaration in relation to the property can be given and this is rather a right of getting declaration created under the statute in favour of the Revenue. Therefore, I hold that these findings and decision of the Commissioner are without jurisdiction and the same are not sustainable. Moreover, this finding of the Commissioner is contradictory to and inconsistent with his stand, for on the one hand he has held that the above transaction is not a transfer and on the other hand in order to apply the provisions of section 281 of the said Act the same has been accepted to be transfer. Under the law one can take alternative plea but there are limitations to entertaining such plea, if it is found the alternative plea is conflicting with the primary one, then no conclusion can be reached, such an alternative plea cannot be allowed to be taken. Therefore I cannot uphold the findings and decision of the Commissioner. Mr. Kapoor says that the findings and the order of the Commissioner should be ignored by me as the order passed by the Commissioner though pursuant to the order of this hon'ble court, is without jurisdiction as he cannot decide this matter at the first instance for these questi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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