TMI Blog1997 (3) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... ad, Ahmedabad which was a residential property. On total partition of the HUF on 3-11-1986, the said property was divided into two equal shares as it admitted such physical partition and each share was allotted to Shri Hariprasad H. Shah - karta and Smt. Lalitaben H. Shah - the assessee before us. The entries to this effect were made in the City Survey Records. The said partition was recognised by the Assessing Officer by passing an order under section 171 on 11-8-1989. Before the Assessing Officer, the assessee claimed a sum of Rs. 14,33,000 as deduction from the cost of acquisition of the house property while computing the capital gains. It was submitted before the Assessing Officer that at the time of partition the assessee had undertaken an obligation to pay a sum of Rs. 14,33,000 to her son Shri Udayan H. Shah. A written explanation was furnished before the Assessing Officer which has been reproduced by the Assessing Officer at page 3 of the assessment order which reads as under: "Under the circumstances I submit that the amount of Rs. 14,33,000 is not merely claimed by way of obligation to pay money to my son under the partition but in reality and in substance it is the amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... B. Daftari v. CIT [1959] 36 ITR 18 (Bom.) approved in Murlidhar Himatsingka v. CIT [1966] 62 ITR 323 (SC), (4) Seth Motilal Manekchand v. CIT [1957] 31 ITR 735 (Bom.), (5) CIT v. Woodlands Co. [1967] 64 ITR 177 (Mys.), (6) Charandas Haridas v. CIT [1960] 39 ITR 202 (SC), (7) CIT v. C.N. Patuk [1969] 71 ITR 713 (Bom.), (8) CIT v. Travancore Sugars Chemicals Ltd. [1973] 88 ITR 1 (SC), (9) CIT v. Smt. Shanti Meattle [1973] 90 ITR 385 (All.), (10) Udayan Chinubhai v. CIT [1978] 111 ITR 584 (Guj.), (11) Matubhai C. Patel v. CIT [1982] 133 ITR 303 (Guj.), (12) CIT v. Rupchand Prabhudas [1982] 134 ITR 632 (Bom.), (13) CIT v. Mohinidevi Mohunta [1988] 171 ITR 557 (Bom.), (14) CIT v. Pompei Tiles Works [1989] 175 ITR 1/41 Taxman 181 (Kar.). The CIT(Appeals) allowed the claim of the assessee holding that the assessee's inherent right in the house property was only to the extent of one-fourth and, accordingly, she was under obligation to pay a sum of Rs. 14,33,000 to her son Shri Udayan H. Shah. The revenue is in appeal before us against the order of the CIT(Appeals). 4. Shri Prabhakant, the learned DR strongly supported the order of the Assessing Officer. He refe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rbook); declaration by the assessee (pages 10 to 16 of the paper book); and the declaration by Shri Udayan H. Shah (pages 17 to 19 of the paper book) and submitted that both the assessee and her husband Shri H.H. Shah who got the property on partition in equal shares were under obligation to pay a sum of Rs. 14,33,000 each to the respective sons for their 1/4th share in the property. According to the learned counsel for the assessee, the amount of Rs. 14,33,000 was a charge on the property and was allowable as a deduction while computing the capital gains in view of the following decisions: (i) CIT v. Daksha Ramanlal [1992] 197 ITR 123 (Guj.), (ii) CIT v. A. Venkataraman [1982] 137 ITR 846 (Mad.), (iii) CIT v. C.V. Soundararajan [1984] 150 ITR 80/18 Taxman 41 (Mad.), (iv) Sajjan Bagaria v. CIT [1978] 113 ITR 430 (Gauhati). 6. By way of rejoinder to the arguments of the learned counsel for the assessee, Shri Prabhakant the learned DR submitted that the declarations on which the learned counsel has placed reliance were only self-serving statements and did not prove that the assessee was under any legal obligation to pay a sum of Rs. 14,33,000 to her son. He submitted that a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al partition they did not get any part of the property. By mutual consent, the members of the HUF divided the property into two equal shares and allotted one share each to the assessee and her husband. Under the Mitakshara law, each coparcener takes an undefined share in the coparcenary property and, hence, the circumstance that the partition has been effected in unequal shares is an irrelevant consideration. 8. The so-called charge of Rs. 14,33,000 in our considered opinion, is a self created charge created by the declarations by the members of the HUF dated 15-1-1987, i.e., after the total partition claim filed before the Assessing Officer and heavily relied upon by the learned counsel for the assessee. Such a charge has no legal sanction and the declarations are nothing but self-serving statements. The deed of partition was neither produced before the Assessing Officer; nor before the CIT(Appeals) and nor before us to enable to ascertain whether such an obligation/charge was created at the time of complete partition. In fact, by claiming the amount of Rs. 14,33,000 in the garb of charge on assessee's share of property, the assessee made an attempt to reduce the capital gains l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the Tribunal was right in its view that the sum of Rs. 60,000 paid to the mother was to be excluded in computing the capital gains. It is evident from the facts of' the case referred to supra that there was a real obligation on the part of the assessees to pay a sum of Rs. 60,000 to their mother for relinquishment of her right of residence in the said property whereas in the case before us there was no right which the assessee relinquished. The assessee's right in the property was absolute. Accordingly, the ratio laid down by the High Court is of no assistance to the assessee. In Sajjan Bagaria's case, the assessee in order to get the assignment of the interest of the assignor in the capital assets, viz., the house property, spent Rs. 15,863 and the Hon'ble Gauhati High Court held that this amount had to be treated as cost of acquisition so far as the assessee was concerned. Obviously the amount was paid for getting the interest whereas in the case before us here was no such liability incurred by the assessee. Accordingly, the facts of the case relied upon by the learned counsel are distinguishable from the facts of the case before us and the ratio laid down there is of no as ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
