TMI Blog1976 (4) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... f property held by them as 'co-owners ' was not liable to tax as association of persons ? " One M. A. Deghamwala died intestate on June 17, 1957. T.M. Sidhpurwala, Badruddin Mohammed Ali, Mariam Bi, Sarifa Bai, and Sakina Bai were the heirs of the deceased, and inherited his properties under the Mohammedan law. On 22nd December, 1959, Mariam Bi, Sarifa Bai and Sakina Bai executed a deed of release relating their rights, title and interest in the properties left by Deghamwala in favour of Sidhpurwala and Badruddin Mohammed Ali. These two persons thus became entitled to half share each in the properties left behind by Deghamwala. Out of the properties so left behind by Deghamwala was property No. 11, Angappa Naicken Street, and a half share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is no material to show that in effecting the sale they did anything more than what an ordinary owner of property would do to convey title. There is no material to hold that there was concerted action with a view to earn capital gains. " If these statements of the Appellate Tribunal are correct, admittedly, the department has to fail because it is conceded before us that it was the department that had to make out a case that the two brothers constituted an association of persons for earning this capital gains. It is not disputed that under the Mohammedan law, the two brothers succeeded to the property of their father in definite shares, and they became tenants in common in respect of their respective shares. In such circumstances, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wners of both the items Nos. 312 and 313, Linghi Chetty Street, G.T., Madras-1, and they were jointly carrying on the construction work in respect of both the items, and with reference to that joint construction work they were in need of funds. Therefore, simply because this recital occurs in the sale deed dated February 28, 1964, it cannot be contended that there was concerted action on the part of the two individuals in bringing about the sale in question for the purpose of making capital gains. It may be mentioned that even the department did not claim that the two individuals owned both Nos. 312 and 313, Linghi Chetti Street, G.T., Madras-1, jointly as association of persons (vide annexure " F " to the reference). One other aspect pre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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