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TMI Blog2024 (11) TMI 1270X X X X Extracts X X X X X X X X Extracts X X X X ..... als. Merely for the reason that in the said assessment years, the assessee effected a sale of some of its properties, it cannot be seen as having embarked upon a business of buying and selling properties in those years, even if it was authorized to do such business as per its Memorandum of Association. The sale of properties by the assessee in the two years under consideration in these appeals must be seen as merely incidental to the activity of letting out of properties for rent carried out by it in the years prior and subsequent to the said two years. The said sale transactions cannot have the effect of changing the very nature of the income earning activity consistently carried on by the assessee, and accepted by the Department. Thus, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee, after having dismissed the appeals earlier citing low tax effect, the Appellate Tribunal was merely exercising its power of rectification of mistakes or whether it was in effect exercising a power of review that it did not have under the Statute. In either event, the exercise by the Appellate Tribunal was without jurisdiction and hence void ab initio . Decided against revenue. - Honourable Dr. Justice A.K. Jayasankaran Nambiar And Honourable Mr. Justice K.V. Jayakumar For the Appellant(S) : By Adv. Smt. Mitha Sudhindran, By Adv. Sri.Souradh C. Valson, By Adv. Smt. Angelina Joy, By Adv. Sri. Riji Rajendran For the Respondent(S) : Sri.Jose Joseph, Sc, Income Tax Department JUDGMENT DR. A.K. JAYASANKARAN NAMBIAR, J. These I.T. Appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'Income from House Property' and the income from the sale of house property during the previous year relevant to the assessment year as 'capital gains'. The Revenue, therefore, carried the matter in further appeals before the Income Tax Appellate Tribunal. The Tribunal initially dismissed the appeals after finding that the amount involved in the appeals was less than the threshold amount prescribed under the Central Board Direct Taxes Circulars [CBDT Circulars] for pursuing litigation. While dismissing the appeals, the Appellate Tribunal, in its order dated 29.08.2019, also reserved the liberty of the Department to approach the Tribunal for a recall of its order if it was found that the appellant's case fell within one o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring previous assessment years creates a legitimate expectation that such categorization is appropriate? v. Whether the Hon'ble ITAT was right in holding that the income from the sale of a property held as a capital-asset should be categorized as business income instead of income from House Property? 5. As is apparent from a perusal of the questions of law raised, the appellant's contention before us are essentially twofold: (i) On merits, it is contented that the Appellate Tribunal fell in error in categorizing the appellant's income as business income. It is contended that the income was always classified under the head 'Income from house property' and there was no change in circumstance warranting a change in classif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om House Property' and not as 'business income'. No doubt, it is open to the Department to categorise the income of an assessee differently for different assessment years, if there are changes noticed in the circumstances that led to the earning of income. In fact, the Revenue would contend that during the previous years relevant to the assessment years under consideration in these appeals, there were sales effected of properties acquired in the recent past, and when the said transactions were viewed against the backdrop of the stated objects in the Memorandum of Association of the appellant company, there was ample material to hold that the transactions in question were in the nature of a business activity and the income earned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in these appeals, can only be assessed under the head of 'capital gains' and not as 'business income'. 8. As for the aspect of limitation, we find considerable force in the contention of the learned counsel for the appellant that the Appellate Tribunal did not have the jurisdiction to consider the rectification application belatedly preferred by the Revenue, based on the liberty granted to it by the Tribunal while dismissing the Revenue's appeals in the earlier round of litigation. The Appellate Tribunal being a creature of the Statute cannot extend its jurisdiction beyond what is expressly conferred on it under the Statute [Madan Lal Arora v. The Excise Taxation Officer, Amritsar [AIR 1961 SC 1565]; Smt.Ujjam Bai v. Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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