2013 (3) TMI 492 - HC - Income Tax

Exemption under Section 54EC denied - Addition on account of short term capital gains - ITAT deleted the addition - the assessee received 30% of the sale proceeds of the land from her brother in accordance with the direction given by her late father in his will - Held that - The assessee received the said sum of Rs. 1,05,00,000/- as inheritance from her father who had clearly indicated in his Will that in case the property is sold, 30% of the sale proceeds would be given to the assessee. The fact that the property was agreed to be sold during the lifetime of the father and part consideration had been received during the lifetime would only imply that the condition upon which the assessee was to receive the said 30% of the sale consideration had already been satisfied during his lifetime. Thus the assessee s share out of the said consideration became payable to her directly under the will on the death of the father. Even if the matter is looked in this perspective the receipt in the hands of the assessee cannot be regarded as income. However, the Tribunal has taken a different approach by holding that even if it is regarded as income the assessee would be entitled to the benefit of income under Section 56(2)(v) of the Income Tax Act, 1961. Either way the answer is the same. No interference with the order of the Tribunal is called for. Addition on account of Income from House Property - CIT (A) deleted the addition - Held that - This issue was decided in favour of the assessee in respect of the assessment year 2005-06 by the CIT (Appeals) and it has not been questioned by the revenue before the Tribunal. Therefore, following the said decision, the Tribunal confirmed the view taken by the CIT (Appeals). Even on that aspect, no interference is called for.

Summary

Issues:
1. Condonation of delay in refiling the appeal.
2. Appeal against the order of the Income Tax Appellate Tribunal regarding short term capital gains and income from house property for the assessment year 2006-07.

Issue 1: Condonation of Delay
The judgment begins by addressing the delay in refiling the appeal, which is subsequently condoned, leading to the disposal of the application. This issue is resolved at the outset, ensuring procedural compliance.

Issue 2: Appeal Against ITAT Order
The appeal challenges the ITAT order concerning the addition of Rs. 1,07,25,000 as short term capital gains and Rs. 6,72,910 as income from house property for the assessment year 2006-07. The assessing officer had added the sum received by the assessee from her brother, as directed by their late father in his will, to the total income. However, the CIT (Appeals) deleted the addition of Rs. 1,07,25,000, a decision upheld by the Tribunal based on different reasons.

Grounds for Deletion
The judgment delves into the specifics of the case, emphasizing that the sum received by the assessee was inheritance from her father as per the will's provisions. The Tribunal's decision is supported by the fact that the condition for the assessee to receive the sale proceeds had been fulfilled during the father's lifetime. Even if considered income, the assessee is entitled to benefits under Section 56(2)(v) of the Income Tax Act, 1961.

Second Ground
Regarding the addition of Rs. 6,72,910, the issue was decided in favor of the assessee for the assessment year 2005-06 by the CIT (Appeals) and remained unchallenged by the revenue before the Tribunal. Consequently, the Tribunal confirmed the CIT (Appeals) decision, warranting no interference.

Conclusion
The judgment concludes that no substantial question of law arises for consideration, leading to the dismissal of the appeal. The detailed analysis of each issue provides a comprehensive understanding of the legal reasoning behind the decision.