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TMI Blog2018 (4) TMI 700X X X X Extracts X X X X X X X X Extracts X X X X ..... the sake of convenience. 3. The grievance of the revenue reads as under:- 1. The Ld.CIT(A) has erred in law and on facts in deleting the addition of Rs. 5,40,00,000/- made on account of receipt for relinquishment of right to sue the party was treated and taxed as business income as against capital receipts shown by the assessee. 2. The Ld.CIT(A) has erred in law and on facts by not appreciating the facts that in the assessee's own case for A.Y. 2009-10 the then Ld. CIT(A)-XI, Ahmedabad vide order No. CIT(A)-XI/347/Wd-5(2)/ll-12 dated 19/11/2013 confirmed the addition holding that relinquishment of rights was income from business operation and condition for development agreement has to be taxable business income. 4. A perusal of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r parties followed by the latter paying it variable amounts in question totaling to Rs. 3.87 crores in lieu of getting former's right to preemptive purchase or right to sue for specific performance surrendered in their favour. There is no evidence in the case file indicating the assessee to have undertaken even a single activity of development is all three parcels of land. We notice in this factual backdrop that hon'ble jurisdictional high court's decision in Baroda Cement and Chemical case (supra) holds that the amount received in lieu of such a right to sue available after a vendor breaching the relevant agreement is not an actionable claim so as to be transferred u/s.6(e) of the Transfer and Property Act giving rise to assessable capital ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s does not carry any merit as Section 17 of the Registration Law could not have been applied in view of bar on transfer of the lands in question. We thus observe that assessee's above development license acquired in its all three agreements does not amount to part performance requiring compulsory registration u/s.17 of the Registration Act. We therefore conclude in this view of all this evidence as well as legal position that the impugned compensation amount is not liable to be treated as income u/s.2(24) of the Act nor the same is taxable as capital gain for business income being in the nature of a capital receipt. 7. Respectfully following the findings of the Co-ordinate Bench (supra), we decline to interfere. Appeal filed by the Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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