9911796707
TMI Blog1993 (11) TMI 89X X X X Extracts X X X X X X X X Extracts X X X X ..... floors was received on 15-12-1983. Thereafter, the flats were sold to various parties. Three flats numbering 701, 801 and 702 were left vacant. These flats were sold during the relevant year of assessment. Flat No. 702 was occupied by the assessee. Flat Nos. 701 and 801 were let out on tenancy basis in the year 1985 at a monthly rent of Rs. 5,000 each to M/s. Anudeep Chemicals and SAP Chemicals. These are associated concerns of the assessee-company. All the shares in the two companies are held by Mrs. Shaileja C. Parikh and Miss Anuradha R. Mafatlal, who are daughters of the Chairman of the assessee-company, Shri R.N. Mafatlal. 3. During the assessment proceedings for the assessment year 1984-85, the assessee had stated that unsold flats ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd papers in the form of a paper book. It was vehemently contended that the case of assessee falls beyond the sweep of section 4 of the Gift-tax Act. The transaction in question cannot be construed to be a deemed gift. Our attention was invited at page 36 of the paper book at an Article of Agreement dated 27th March, 1989. Clause (iv) of the said agreement reads as under: "The purchaser is thus the lawful tenant of the company in respect of the said flat No. 701 in terms of the agreement dated 31-1-1985 and entitled to protection from eviction under the provisions of the Bombay Rents, Hotels and Lodging Houses Rates Control Act, 1947;" 8. It was further contended that the ownership in relation to the said flats was encumbered by the tenan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the flats was Rs. 26,82,193 each. Despite, it was given over to the company owned by the daughter of the Managing Director on a nominal rent. Ultimately it was sold for Rs. 9 lakhs only. Clearly, the arrangement was a subterfuge to avoid the tax liability. It was further stated that the transfer was not in regard to reversionary right. It was the transfer of ownership. In the alleged lease agreement, there was no stipulation in regard to duration of term. It was a mere general letting. A lease which is silent as to duration of term would be void as a lease. Therefore, if it is to be treated as a lease, it was a void lease. It was only a case of tenancy. The real value of each flat was in the near vicinity of Rs. 40 lakhs as per the other s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1882 as under: " 105. A lease of immovable property is a transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms. The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent." 10. 1. The term, or period is an essential element of a lease. A lease which is silent as to duration of term would be void as lease, though it ..... X X X X Extracts X X X X X X X X Extracts X X X X
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