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TMI Blog1993 (3) TMI 43X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1961, were to be given to the assessees ?" The five assessees along with one other person were the owners of a property known as "Adville". This property consisted of a bungalow with some vacant land appurtenant to it. This property was of the co-ownership of the assessees plus one other person. Two of the assessees had each a 1/6th share in the property and the other three assessees had a 1/9th share each. The sixth co-owner, who is not before us, held the remaining 1/3rd share. The entire property was in the actual occupation of the six co-owners during the two years that preceded the assessment year 1973-74. The income from this property was also being regularly assessed to tax in their hands as income from house property. On Oc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e respective buyers under the Maharashtra Ownership Flats Act. Although the facts are not very clear, it seems that there was an unavoidable delay in executing the conveyance in respect of the bungalow in favour of the assessees because the buyers of the property had by then not completed the construction of the flats on the open land and the ultimate conveyance could not be effected or completed until the flats were constructed and possession was handed over to the respective buyers in terms of the Maharashtra Ownership Flats Act. (This is set out in the order of the Appellate Assistant Commissioner which is annexed at annexure "B-III") In their respective assessments, the six co-owners claimed exemption in respect of the sum of Rs. 7 la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany only on March 16, 1949, and by the shareholders of the company at the general meeting on April 10, 1949. The question was whether capital gains arose from the sale in the previous year ending March 31, 1948. The court held that before section 12B of the Indian Income-tax Act, 1922 (equivalent to section 54 of the present Act) could be attracted, there must be a sale deed which was executed and registered. Since the sale deed was not executed and registered till November 22, 1948, no sale took place during the previous year ending on March 31, 1948, and hence no capital gains arose in the relevant previous year. There is another judgment of the Supreme Court in the case of CIT v. Bhurangya Coal Co. [1958] 34 ITR 802, which is relied u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court was whether this would amount to purchase of the house by the assessee attracting section 54(1). The Supreme Court held that the word "purchase" in section 54(1) had to be given its common meaning, viz., buy for a price or equivalent of price by payment in kind or adjustment towards a debt or for other monetary consideration. Each release in this case was a transfer of the releasor's share for consideration to the releasee and the transferee-assessee "purchased" the share of each of his brothers and the assessee was, therefore, entitled to the relief under section 54(1). Mr. Dwarkadas, learned counsel for the assessee, has also drawn our attention to a judgment of the Andhra Pradesh High Court in the case of CIT v. Mrs. Shahzada B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne year and, therefore, they become eligible for exemption under section 54(1). It is, however, contended by Dr. Balasubramanium that this is not a genuine purchase by the assessees. According to him, the entire transaction must be looked at only as a conveyance by the assessees of the land and they must be considered as not having sold the bungalow at all. Hence, the question of relief under section 54(1) does not arise at all in the facts of the present case. We are unable to accept this contention. The conveyance which has been executed by all the co-owners is clearly conveyance of the bungalow as well as the land appurtenant thereto. Such a conveyance appears to have been made in order to ensure the availability of the F. S. I. for co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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