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TMI Blog1987 (11) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... for the Government to the tune of Rs. 1,85,230 as arrears and Rs. 27,851 for the year under assessment. Before the ITO the assessee argued that the amount of compensation received by the assessee has to be considered as "Capital Gains", but the same was not taxable as the cost of capital assets so acquired by the Government could not be envisaged in terms of money. She also urged that the said amount was not liable to be taxed under the head "income from property," as she had not let out the property to the Government, but the same was requisitioned by the Government under its sovereign power without the consent of the assessee. The ITO rejected the argument of the assessee and assessed the said amount of Rs. 2,13,081 under the head "Other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above property. The assessment of this income as property income was being correctly made. ITO is not correct in taking as income from other sources. In my opinion, therefore, the ITO is not justified in taxing the entire amount received in this year. The accounts would be taxable in the different years as property income. (5) Property income is taxed on the basis of the annual letting value. The fact that the Government have paid Rs. 2,785.14 per month would show hat he current annual letting value for the appellant's portion of the property is Rs. 2,785.14 and the annual letting value was not correctly taken by the ITO in the past years. The ITO is, therefore, directed to determine the correct property income for the year under conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bundle of rights-right of possession and enjoyment, right of alienation or transfer. In its general sense the expression 'transfer of property' connotes passing of right of property from one person to another. In one case, there may be a passing of the entire bundle of rights from the transferor to the transferee. In another case, the transfer may consist of one of the rights of all the rights comprising the totality of the rights in the property. yet in another case there may be a reduction of the exclusive interest in the totality of the rights of the original owner into joint or shared interest with other persons. An exclusive interest in property is a larger interest than a share of interest in that property. To the extent to which the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the amounts of compensation received by the assessee were taxable in different years as property income. 5. The arguments of the Departmental Representative were to the following effect : the CIT(A) erred in holding that the ITO was not justified in taxing the entire amount of compensation received in this year under the head "other sources" and that the amount would be taxable in different years as property income. He also erred in directing the ITO to determine the correct property income for the year and thereby reducing the addition of Rs. 2,13,081. 6. We have considered the rival submissions and perused the papers filed. House No. 5, at Sikander Road, New Delhi, in which the assessee has got 1/3rd share was requisitioned under th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be charged to income-tax under the head "income from house property". Ownership itself is the criterion of assessment under s. 22. The term 'ownership' is not merely a word of technical legal meaning but it is to be interpreted in its broadest possible meaning. It consists of a bundle of rights in respect of a property, for example, right to posses, right to use and enjoy, right to manage, right to its income and rights to alienate. By the requisitioning order dt. 21st Aug., 1947, the possession and enjoyment of the property had been given to the Central Government. The assessee is deprived of only this right. Still she is getting the income from it under s. 8(2) of the Requisitioning And Acquisition of Immovable Property Act, 1952 wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereby the Government has taken possession of the house like a tenant and has paid the compensation for its use and occupation. So, the compensation has to be assessed only under s. 22 as income from "house property". The Calcutta High Court in the case of Sri Ganesh Properties Ltd. vs. CIT (1962) 44 ITR 606 (Cal) has held that "a person may be assessed as the owner of a property under s. 9 of the Indian IT Act, 1922 even though he has no right to alienate the property or his full right of ownership is in some other way subject to contractual or other limitations." Again in the case of S.B. (House Land) Pvt. Ltd. vs. CIT (1979) 119 ITR 785 (Cal) the Calcutta High Court held that where certain valuable right or rights in respect of a prop ..... X X X X Extracts X X X X X X X X Extracts X X X X
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