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TMI Blog2022 (2) TMI 973X X X X Extracts X X X X X X X X Extracts X X X X ..... aid down in the decisions cited before us, we are of the view that the amount paid by the assessee to M/s Colo Colour Pvt Ltd is an expenditure in connection with transfer of a capital asset as per section 48(i) of the Act; hence allowable. - I.T.A. No.2553/Mum/2019 (Assessment year 2013-14) - - - Dated:- 16-12-2021 - SHRI G.S. PANNU (HON BLE PRESIDENT) AND SHRI SAKTIJIT DEY (HON BLE JUDICIAL MEMBER) Appellant by Ms.Kinjal Bhuta, AR Respondent by Shri Bharat Andhle[CIT, (DR)] ORDER Per Bench: This is an appeal by the assessee against order dated 25-02-2019 of learned Commissioner of Income Tax (Appeals)-48, Mumbai for the assessment year 2013-14. 2. The effective grounds raised by the assessee read as under:- On the basis of facts and circumstances of the case and in law; 1. The Ld. Commissioner of Income Tax (Appeals) erred in conforming the actions of AO of not allowing ₹ 80,00,000/- claimed u/s. 48 of the Income Tax Act,1961 from the sale proceeds in calculation of Long term Capital Gains without appreciating the fact that that the amount was paid in compliance to the Consent Terms approved by the Bombay High Court. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stand taken before the departmental authorities, learned counsel for the assessee submitted, after the assessee along with other coowners sold the property, another person disputed the sale by claiming ownership over the property. In view of the dispute over the ownership of the property, the buyers filed a suit seeking declaration of title over the property. It was submitted, ultimately, the dispute was settled by virtue of a consent term approved by an order of Hon ble Bombay High Court on 02-12-2013. She submitted, as per the consent terms, the buyer was required to pay a sum of ₹ 7,50,00,000/- to the defendant to perfect its title over the property. Further, the consent term required the other plaintiffs, i.e. the assesse and the other coowners to pay a sum of ₹ 4 crores to the buyer M/s Colo Colour Pvt Ltd. She submitted, since the assessee had 20% share in the property as co-owner, he paid an amount of ₹ 80 lakhs. The learned counsel submitted, to perfect the title over the property by removing the encumbrance, the assessee had to pay the amount of ₹ 80 lakhs. Otherwise, the sale deed would have become invalid. Therefore, since the payment of compensat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that M/s Colo Colour Pvt Ltd being plaintiff No.1 will pay a sum of ₹ 7,50,00,000/- to Shri Premjibhai Ruparel, the defendant No.1 to the suit. Clause 9 of the consent terms also provided that plaintiff nos 2 to 11 (the assessee and other co-owners) would pay plaintiff no.1, M/s Colo Colour Pvt Ltd a sum of ₹ 4 crores and which was paid through cheque issued on 28-11-2013. Assessee s share in the property being to the extent of 20%, he contributed a sum of ₹ 80 lakhs. 9. Thus, it is a fact on record that as per the consent terms approved by the Hon ble jurisdictional High Court, assessee paid a sum of ₹ 80 lakhs to the buyer M/s Colo Colour Pvt Ltd. Therefore, the payment made by the assessee is established on record and hence, cannot be disputed. In our view, learned Commissioner (Appeals) has completely misconceived the facts and made a fundamental error while observing that assessee s claim cannot be allowed in absence of complete terms and conditions of agreement date 18-11-2002 as mentioned in the consent terms approved by the High Court. Undisputedly, the consent terms along with Hon ble High Court s order was very much available before learned Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the facts of the case in detail earlier. It cannot be disputed that, unless the assessee had settled the dispute with Radia and Sons (Pvt.) Ltd., the sale transaction with M/s. Cosmos Cooperative Housing Society Ltd., under the agreement dt. 30th March, 1967, would not, rather could not, have materialised. If this transaction had not materialised, there would perhaps have been no question of capital gains. The sale would then have taken place at the rate of ₹ 29 per sq. yard as against ₹ 61 per sq. yard. One way of looking at the problem could be to say that the full value of the consideration in this case was not the apparent consideration, i.e., ₹ 2,58,672, but ₹ 2,23,168 (i.e., 2,68,672 minus ₹ 35,504), The Legislature, while using the expression full value of consideration ; in our view, has contemplated both additions to as well as deductions from the apparent value. What it means is the real and effective consideration. That apart, so far as cl. (i) of s. 48 is concerned, we find that the expression used by the Legislature in its wisdom is wider than the expression for the transfer . The expression used is the expenditure incurred wholly and ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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