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TMI Blog1990 (1) TMI 120X X X X Extracts X X X X X X X X Extracts X X X X ..... ld to Ansal Sehgal Property Pvt. Ltd. vide an agreement of sale executed on 15-6-1976 in consideration of Rs. 78 lakhs. Out of the sale consideration, the vendors had to pay the unearned increase to Land Development Office and were also to pay registration charges. They, accordingly, received net consideration of Rs. 60 lakhs. The balance of Rs. 18 lakhs was retained by Ansal Sehgal Property Pvt. Ltd. On taking possession of the property, M/s Ansal Sehgal Property (P.) Ltd. converted the Sen Nursing Home into commercial flat after spending substantial amounts and thereafter these flats were sold. However, neither the propeny, which was sold by the assessee along with other co-owners to M/s. Ansal Sehgal Property Pvt. Ltd. was regi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in accordance with the decision of the Hon'ble Delhi High Court in Sushil Ansal's case and accordingly no interference is called for. He further drew our attention to the observations of the Delhi High Court in Sushil Ansal's case at page 314 and urged that keeping the facts and circumstances of the case, in view, the assessee is not liable to tax on the notional income from house property which has been sold and in turn converted into flats, in respect of which assessee is having only a hollow title. 4. We have given our careful consideration to the rival contentions and have perused the records. In this case, it is not disputed that the assessee has sold the house property and registered instrument required for transferring the legal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e may occupy for the purposes of any business or profession carried on by him the profits of which are chargeable to income-tax shall be chargeable to income-tax under the head "Income from house property". Section 23 : "For the purposes of sec. 22, the annual value of any property shall be deemed to be :-- (a) the sum for which the property might reasonably be expected to let from year to year; or (b) where the property is let and the annual rent received or receivable by the owner in respect thereof is in excess of the sum referred to in clause (a), the amount so received or receivable: Provided ............. " Whereas section 22 provides for assessment of annual letting value of the buildings and lands appurtenants thereto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n existence in the same form in which it was before its transfer. Annual letting value of the property is to be assessed of such property of which the assessee is the owner. Therefore, property must exist in such form in which it can yield annual rent. If the property is not capable of yielding any rent the annual letting value shall, in our view, be NIL. This is so because the assessee in having only a hollow title in respect of the property which is no more in existence in the form in which it has been sold. 6. In such circumstances, income from house property cannot be assessed in the hands of the assessee. We may usefully refer to the decision of the Supreme Court in the case of R.B. Jodha Mal Kuthiala v. CIT [1971] 82 ITR 570. In thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i).................. (ii).................. (iii) ................... (iiia) a person who is allowed to take or retain possession of any building or part thereof in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882 (4 of 1882), shall be deemed to be the owner of that building or part thereof" It may also be relevant to quote section 53A of the Transfer of Property Act : "53A. Part performance --Where any person contracts to transfer for consideration any immovable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty, and transferee has, in part performance of the contract t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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