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TMI Blog2020 (5) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... y right. As we have noted earlier that it is settled position under the law, that tenancy right is a transferable asset. The assessee received consideration on transfer of said right - assessee has unambiguously proved that asset was in the possession of assessee for more than three year, thus, on the sale of tenancy right the assessee is entitled for LTCG. Therefore, the addition under section 68 against the proceeds of sale consideration is not unjustified. In the result, Ground No.1 of the appeal is allowed. Exemption u/s 54F - HELD THAT:- In the computation of income and working of Capital Gain the assessee has claimed exemption on the ground that assessee has invested the sale proceeds for acquisition of residential property/ flat No. 39 in Raheja Towers, Rajabhau Desai Marg, Prabhadevi, Mumbai. As the AO treated the sale proceeds of tenancy right as unexplained cash credit and resultantly not allowed the deduction/exemption under section 54F. Considering the fact that we have allowed LTCG by allowing Ground No.1 in favour of assessee. Thus, we direct the AO to verify the fact about the investment of sale consideration / gain in purchase of new residential house and allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ital asset with the documentary evidences. The assessee filed its reply and furnished the copy of agreement dated 29.05.2015 with regard to transfer of tenancy right in a Flat on second floor Champagene House, Worli Sea Face Mumbai, to M/s Pine Tree Estate Pvt Ltd. The assessing officer again vide notice dated 24.11.2018 under section 142(1) asked the assessee to furnish the evidence of acquisition of tenancy right in the said flat. The assessing officer recorded that the assessee filed reply dated 01.12.2018, but no documentary evidence related to the acquisition of the said flat was furnished by the assessee. 3. The assessing officer issued notice under section 133(6) dated 07.12.2016 to the Secretary of Champagene House, Worli Sea Face Mumbai, to furnish the details of ownership of the property, occupants of the property in last ten years, if the said flat was occupied by the owner or third party or was given on lease or rent and to furnish the copy of the lease/ tenancy. The assessing officer recorded that the secretary of Champagene House, Worli Sea Face Mumbai, with his reply dated 26.12.2016 furnished the copy of agreement to sale dated 29.05.2015 and that no evidence of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt has provided multiple opportunity and stated that burden of proof is on the assessee to explain satisfactorily with regard to the transaction shown in the return of income along with documentary evidences despite providing sufficient opportunity to prove the genuineness of transaction, appellant failed. In view of the above observation, I find no reason to interfere in the order of AO. Accordingly, the addition of ₹ 22,50,00,000/- as unexplained cash credit made under section 68 by the AO is upheld. Ground No. 1 is dismissed. 7. Further, aggrieved by the order of ld.CIT (A), the assessee has filed the present appeal. 8. We have heard the submissions of learned authorised representative (ld. AR) of the assessee and the learned departmental representative (ld. DR) for the revenue and perused the material available on record. Ground No.1 relates to taxing the sale consideration of tenancy right as unexplained cash credit. The learned AR of the assessee submits that assessee entered into agreement dated 29th May 2015 for sale of tenancy right of a flat situated on the 2nd floor of Champagne house, earlier known as Shakuntala building, 69 Worli, Mumbai. The tenancy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its that the assessing officer wrongly concluded that source of sale of consideration is not established and treated the entire sale consideration as unexplained cash credit under section 68 of the Act. No further investigation was conducted by assessing officer against the purchaser for doubting his credibility. 9. Before the learned CIT(A) the assessee again furnished complete documentary evidences which were furnished before the assessing officer. The assessee specifically contended that assessing officer has wrongly recorded that the documents establishing the acquisition of property has not been furnished. The learned CIT(A) however, dismissed the appeal of assessee by merely reiterating the same contents as made by the assessing officer. The learned CIT(A) confirming the action of assessing officer recorded that no documentary evidence was furnished by the assessee. The learned CIT(A) has not given any finding on the documents furnished before him, which has been duly recorded in para 4 of the impugned order. The assessee during the assessment as well as during first appellate stage furnished complete details with regard to acquisition of tenancy, partition of tenancy r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enanted property along with family. The tenancy in the property was sold to buyer on 29th May 2015. 13. On the objection of assessing officer that buyer has no creditworthiness to enter into the said transaction. The learned AR for the assessee submits that in the deed of transfer of tenancy right, all details of buyer along with address and permanent account number (PAN) are mentioned. The assessing officer only doubted the capacity of the buyer but has not proved anything with regard to the same except observing that on perusal of return of income or Pine Tree Estate Private Limited, it is seen that company has offered nil income for AY 2016-17 . The ld. AR submitted that buyer is not a related party. 14. On the observation of assessing officer that secretary of the society to furnish the partition deed cannot lead to a conclusion that assessee has not acquired such right. In the notice under section 133(6), the assessing officer merely ask the secretary of the assessee to furnish, lease documents, tenancy document of the property in the last 10 years. No enquiry with regard to the agreement/partition took place in 1984 was asked. The learned AR of the assessee finall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is claimed by the assessee were actually placed before the lower authorities or not. 19. Considering the submissions of both the parties, on 02-01-2020, we treated the matter as part-heard and hearing of the appeal was fixed for 10-01-2020 and we directed ld. CIT-DR to call the record of assessment and first appellate authority. On 10-01-2010, the assessing officer brought the record of assessment as well as of the first appellate authority attended the hearing with ld. CIT-DR. 20. We have perused the record of first appellate authority and find that the assessee had furnished the following documents, which are still available on record:- Screen shot of the E-filing portal showing submission of documents online on 01-12-2018, 10-12-2018 and 11-12-2018, E-filing acknowledgements for submissions made before the Assessing Officer, Memorandum of partition date 31.03.1984, Deed for transfer of tenancy dated 29.05.2015, Working of capital gain on transfer of tenancy and Copy of Written submissions file before CIT(A) 21. We raised our specific quarry to the assessing officer, if the documentary evidences uploaded by the assessee were examined/ perused by hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its transfer or not. The assessee has unequally proved the holding period of asset for more than couple of decades. 23. On the other hand, the Ld. DR again reiterated his submission made on 05-12-2019 and submitted that once there is a finding of lower authorities that no evidence was furnished by assessee and that the AO has not examined the evidence, the matter requires fresh consideration by AO. 24. We have considered rival submissions of both the parties and perused the material available on record. In the computation of income the assessee claimed LTCG on sale of tenancy right in a flat. The assessee also claimed deduction of entire gain as it was invested in purchase of new residential house. The case of the assessee was selected for limited scrutiny on two issues i.e. (i) whether investment and income relation to properties are duly disclosed and (ii) whether deduction from capital gain has been claimed correctly. On perusal of working of LTCG the AO noted that the assessee claimed Capital Gain of ₹ 22.50 Crore in the previous year on transfer of tenancy right in a flat in Worli, Mumbai. The AO issued show cause notice to the assessee to furnish the details of c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that tenancy right is a capital asset. The lower authority has not disputed that nature of capital asset. The lower authority disputed about the acquisition of the tenancy right by taking view that assessee failed to prove by documentary evidence that assessee has genuine transaction. We have noted that before us the assessee has furnished copy of screenshot of portal of department (web-portal) showing that assessee uploaded document on 29.11.2018, 11.12.2018, 10.12.2018 01.12.2018. Further, the assessee has placed on record, the submission of document in response to notice dated 01.08.2018 on 05.12.2018, wherein the assessee furnished the copy of partition deed of B.D. Toshniwal (HUF) dated 31.03.1984 by virtue of which the tenancy was transfer to Vinay Toshniwal (HUF). The copy of acknowledgement about furnishing the aforesaid documents is filed on record as per page no.9 of PB. 26. During the hearing on 10.01.2012, this fact was confronted with the AO. The ld. AR of the assessee vehemently submitted that all the documents uploaded on the portal of revenue, screenshot of which is placed on record, can still be opened to ascertain the contention of assessee about the submissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vinay Toshniwal (HUF). The assessee has also placed on record the rent receipt for payment of rent from April 2015 to May 2015 @ ₹ 4000/- paid to V.S. Chougule R.S. Chougule Pvt. Trust. We have further noted that all these documents were filed before AO as well as the ld. CIT(A). This fact was verified by us from the record of ld. CIT(A) while hearing the appeal. The lower authority has not given any finding on the documentary evidence furnished by assessee to substantiate that the asset in the form of tenancy right was in existence since 1970. 28. From the documentary evidence, we find that initially the tenancy was created in the name of B.D. Toshniwal (HUF), which was transferred to Vinay Toshniwal (HUF) after its partition in 1984. The owner of the building/property while transferring the tenancy right acknowledged the tenancy right in favour of assessee being one of the confirming party in the transfer deed dated 29.05.2015 and received consideration of ₹ 45,00,000/-. The assessee has also placed on record other corroborative evidence being rent receipt of tenanted premises. 29. We have further noted that during the assessment, the AO made investigation fro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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