2014 (6) TMI 541 - HC - Income Tax

Sale proceeds of immovable property Transfer covered u/s 2(47)(v) of the Act or not - Whether the sale proceeds in respect of the immovable property sold by the assessee by agreement for sale is assessable as business income or capital gain under the provisions of the Income Tax Act Held that - No record of any appeal have been filed is available - an appeal challenging the finding of fact recorded by the Tribunal has not been filed - revenue has accepted this finding of fact and in relation to the same assessee for prior assessment years - In such circumstances, we do not find that the appeal raises any substantial question of law - in the case of persons to whom the property has been transferred, the relevant date of bringing the income to tax, would be the date on which the entire consideration is received - the possession of the immovable property was not taken or retained - the finding of fact which is recorded by the Tribunal in prior AYs has also been recorded in subsequent AYS and in relation to the same assessee Decided against Revenue.

Issues:
1. Assessment of sale proceeds as business income or capital gain under the Income Tax Act.
2. Interpretation of Section 2(47)(v) of the Income Tax Act regarding the transfer of immovable property.
3. Consideration of prior tribunal orders and appeals challenging findings of fact.
4. Determination of relevant date for bringing income to tax in individual transactions.
5. Conclusion on substantial questions of law raised in the appeal.

Analysis:

1. The appeal challenged an order by the Income Tax Appellate Tribunal regarding the assessment year 1990-1991. The main issue raised was whether the sale proceeds of an immovable property should be treated as business income or capital gain under the Income Tax Act. The petitioner argued that the Tribunal's view was incorrect and raised questions regarding the nature of the transaction.

2. The petitioner contended that the transfer of the immovable property should fall under Section 2(47)(v) of the Income Tax Act. The argument centered around the possession of the property by the transferee and the relevant date for transfer as per the provisions of the Act. The Tribunal's decision on the effective date of transfer was challenged based on the interpretation of Section 2(47)(v).

3. The court considered prior tribunal orders and appeals filed by the revenue challenging factual findings. It was noted that no appeal had been filed against the findings of fact recorded by the Tribunal for prior assessment years. This acceptance of facts by the revenue indicated that no substantial question of law was raised in the current appeal.

4. The Tribunal's decision on individual transactions and the determination of the relevant date for bringing income to tax were examined. The court found that the Tribunal's view was plausible based on the specific terms of the transaction in question. The relevance of the possession of the immovable property in determining the taxability was emphasized.

5. Ultimately, the court dismissed the appeal, concluding that no substantial question of law was raised. The decision was supported by the findings in prior assessment years and a Division Bench order in favor of the assessee. The judgment highlighted the consistency in findings across different assessment years and the lack of grounds for challenging the Tribunal's decision.

This comprehensive analysis addresses the key issues raised in the judgment, providing a detailed overview of the legal reasoning and conclusions reached by the Bombay High Court.

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