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TMI Blog2016 (5) TMI 923X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Revenue. The Revenue has filed an affidavit explaining the reasons for the delay in filing the appeal by stating that, there was acute shortage of staff and the piled up year ending work. It was further submitted that the delay was neither willful nor wanton. Therefore, it was prayed that the delay may be condoned. After considering the same, in the interest of justice, we hereby condone the delay in filing of appeal and admit the same for adjudication. 3. The Revenue in its appeal has raised the following two grounds:- i) The learned Commissioner of Income Tax (Appeals) has erred by directing the Assessing Officer to treat the income arising out of EOU unit in Mumbai SEPZ as 'income from capital gains' as against 'business income' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. The seized materials (ANN/RV/LSS - 89- page 65) obtained during the course of search revealed that the assessee had entered into a memorandum of understanding dated 21.07.2006 with M/s. Geodesic Information Systems, Mumbai to sell its SEZ unit for a sale consideration of Rs. 2.38 crores. It was also an admitted fact that the assessee has received the sale consideration in lieu of the executed sale. In the return of income, the assessee declared the sale consideration as Rs. 2,38,00,000/- being the amount received towards the transfer of leasehold rights of the premises occupied by the assessee in the SEEPZ Mumbai and treated the same as" income from capital gain". However, the learned Assessing Officer opined that the claim of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered the reasons for treatment of the sale as business income and the arguments advanced against such treatment by the learned ARs of the appellant. The unit at SEEPZ Mumbai did not belong to the appellant. It had only rights over the unit which was transferred and this could only be a capital asset. The appellant is not in the business of real estate and in any case, the unit did not belong to the appellant. Therefore the sale of such rights can only be assessed under capital gains. In the circumstances, the Assessing Officer is directed to treat the income returned as income from capital gains." 7. The learned Departmental Representative vehemently argued in support of the order of the learned Assessing Officer stating that the income r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted in the profit and loss account of the assessee and only the gross amount was returned as capital gains amounting to Rs. 2.38 crores. The learned Commissioner of Income Tax (Appeals) further observed in his order that the addition made by the learned Assessing Officer would amount to double addition. 10. The learned Departmental Representative vehemently argued before us by stating that the disallowance of these expenses by the learned Assessing Officer was justified and pleaded to confirm his order. On the other hand the learned Authorized Representative submitted before us that the assessee had adduced sufficient evidence to substantiate that these expenses were paid by the purchaser and adjusted towards the payment due to the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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