Income Tax Appellate Tribunal - Mumbai
Hajra I Menon , vs Assessee on 12 October, 2012
IN THE INCOME TAX APPELLATE TRIBUNAL
MUMBAI BENCH "H", MUMBAI
Before and Shri P.M.Jagtap, Accountant Member
and Shri Amit Shukla , Judicial Member.
M.A. No. 281/Mum/2011.
(In ITA No.3848/Mum/2009)
Assessment Year : 2007-08.
Mrs. Hajra Memon, The Income-tax Officer,
427, Arun Chambers, Vs. 16(1)(4),
Tardeo Road, Mumbai.
Mumbai - 400 034.
PAN ALWPM 6969M
Applicant. Respondent.
Applicant by : Shri G.S. Pikale.
Respondent by : Shri Om Prakash.
Date of Hearing : 12-10-2012.
Date of Pronouncement : 09-11-2012.
ORDER
Per P.M. Jagtap, A.M. :
By this Miscellaneous Application, the assessee is seeking rectification of the mistake alleged to have crept in the order of the Tribunal dated 18th January, 2012 passed in ITA No. 3848/Mum/2010.
2. The learned counsel for the assessee while supporting this miscellaneous application filed by the assessee submitted that the issue raised in ground No. 1 and 2 of the Revenue's appeal has been decided by the Tribunal holding that the transfer took place on 04-11-2012 and not on 28-05-1999 as held by the learned CIT(Appeals) by accepting the stand of the assessee or on 22-02-2007 as held by 2 M.A.No. 281/Mum/2012 the AO. He contended that while arriving at the said conclusion, the Tribunal has overlooked/ignored the following facts of the case :
i) There is no mention in assessment order or in the CIT(A)'s order that the transfer took place on 4.11.2004. Also in the grounds taken by the revenue, there is no mention dated 4.11.2004.
ii) Ld CIT(A) has given finding that the tenancy right got converted into ownership right on 28.5.1999 and not in 2007-08.
iii) Hon'ble Tribunal has not taken into consideration the para 3 of consent terms, which clarifies that the tenancy right would be created forthwith (emphasis supplied) as per Hon'ble High Court in its order in Suit No. 1593 of 1999 dated 28th May, 1999. Hence, it is clear that the assessee became the owner of the property from the date of order of Hon'ble High Court.
iv) The decision of Hon'ble High Court in assessee's case is binding on all the lower authorities. Hence, Hon'ble Tribunal cannot go beyond the decision of Hon'ble High court.
v) At the time of hearing, the question that transfer took place on 4.11.2004 was not put to the assessee to controvert the same.
vi) Similarly, it is not open to the Tribunal to make out a new case which was not a case of either the assessee or the revenue.
vii) The Tribunal cannot come to the conclusion to an issue which was not taken in the Memorandum of appeal.
vii) The deed of confirmation was made only to register the document as the decree passed by the Hon'ble Court itself operates as the transfer, which should have been registered at that time. For complying with the provisions of registration Act, the deed of confirmation was prepared. No fresh rights are created by deed of confirmation as can be seen from the documents. The right arising out of the decree of Hon'ble High Court became final in 1999 and was recorded in the deed of confirmation. In fact, the stamp office has now issued a circular mentioning that the document has to be registered within four months from the date of its execution, copy of which is enclosed for kind reference.
3 M.A.No. 281/Mum/2012ix) Therefore, it is clear that pursuant to Hon'ble High Court's order dated 28.5.1999, agreement dated 11.4.2004 and 22.2.2007 were executed to facilitate/effect to the transaction. Thus, the agreement made on 11.4.2004 in compliance to High Court's decision, cannot be the basis that the transfer took place on that date.
The learned counsel for the assessee contended that the Tribunal thus has decided the date of transfer as 04-11-2004 which was neither the case of the assessee nor the case of the Revenue and the decision so rendered was beyond the scope of controversy raised in the appeal filed by the Revenue as to whether the transfer took place on 28-05-1999 or on 22-02-2007. He also contended that the judgment of Hon'ble jurisdictional High Court has not been considered by the Tribunal which has given rise to a mistake apparent from record as held by Hon'ble Gujarat High Court in the case of ACIT vs. Saurashtra Kutch Stock Exchange Ltd. 262 ITR 146 affirmed by Hon'ble Supreme Court in 305 ITR 227. The learned DR, on the other hand, submitted that a specific view has been taken by the Tribunal while holding that the transfer took place on 04-11-2004 and it is not permissible to review the same in the guise of rectification u/s 254(2).
3. We have considered the rival submissions and also perused the relevant material on record. It is observed that the dispute relating to the exact date of transfer in the context of the year of taxability of long term capital gain was raised in ground No. 1 and 2 of the Revenue's appeal which read as under :
"1. The Ld. CIT(A) erred in directing the addition of Rs.68,45,651/- as Long Term Capital Gain, and accepting the Tenancy Right got converted into ownership right as per consent decree dated 28.05.1999 and not in A.Y. 2007-08 when the agreement for giving ownership right was registered through a transfer deed.
2. The Ld. CIT(A) erred in not accepting the fact that the assessee tenant surrendered / exchanged / transferred the Tenancy Right acquired for 4 M.A.No. 281/Mum/2012 Rs.9 lakhs with ownership right worth Rs.1,13,49,000/- on 22.02.2007 and not on 28.05.1999 when the consent decree was passed.
4. After considering the submissions made by both the sides and perusing the relevant material on record, the issue raised in ground No. 1 and 2 of the Revenue's appeal was decided by the Tribunal vide paragraph No. 7 to 9 of its order dated 18th January, 2012 (supra) which are reproduced below :
"7. We have heard the rival submissions of the parties and perused the records. The facts pertaining to the controversy are already narrated in detail in upper part of this order. One Mr. M.K. Mohammed was in adverse possession of the land situated at "Gurukripa" Dr. Annie B. Road, Worli, Mumbai. The said Shri Mohammed was running the restaurant there as he has constructed the structure on the said property. It appears that there was a litigation between co-owners in the Hon'ble High Court. The Hon'ble High Court has appointed one Court Receiver namely Mr. D.B. Khade. As per facts on record Shri M.K. Mohammed and other occupants /tenants were in the said property. The Court Receiver filed the Suit against Shri M.K. Mohammed in the Hon'ble High Court of Bombay seeking the relief by way of directions to get the vacant possession of the said property from Shri M.K. Mohammed. There was compromise or settlement between Shri M.K. Mohammed and Court Receiver and in pursuance of the Consent Terms filed in the Hon'ble High Court in the Suit filed by the Court Receiver, the Hon'ble High Court passed a Consent Decree. Meantime, the assessee entered into an agreement with Shri M.K. Mohammed for acquiring the rights in the property which was in his possession for the consideration of Rs.9,00,000/- and the said agreement was executed in 06.08.1986. It appears that the assessee took over the possession of the disputed property from Shri M.K. Mohammed and hence, the co-owners of the said property challenged the Consent Decree of the Court passed in 1988 and also made the assessee as a party to the Suit Proceedings. Again there was settlement between the co-owners and the assessee and it was agreed that the assessee would remove her from the property which was subject matter of the Court litigation and also she would remove all the furniture, fixture and other belongings and give the vacant possession to the co-owners and the co- owners agreed to give alternate premises in the form of 14000 sq.ft. carpet 5 M.A.No. 281/Mum/2012 area on the third and fourth floors of Shriniketan Building together with six covered car parking spaces and one open car parking space. As per the Consent Terms, it was also agreed that when the co-operative society would be formed the assessee would be given the full ownership rights of the said premises and till that time the assessee would be treated as the tenant on the monthly rent of Rs.10,000/-. The Hon'ble High Court passed the Consent Decree as per the Consent terms filed by the coowners and the assessee 29.05.1999. In pursuance of the Consent Decree the assessee vacated the property which was subject matter of The litigation and took the possession of the alternate premises in Shriniketan building. There was an agreement on 4.11.2004 to that effect. When the assessee made the compliance of the Consent Decree and agreement was executed on 04.11.2004, in our opinion, at the most, the transfer can be treated on that day when the effective agreement was executed in pursuance of the consent decree even if said agreement was not registered but subsequently registered on 22.02.2007 by way of Confirmation Deed. So far as plea of the assessee that there was no transfer at all is without any base. The assessee was accepted as a tenant by the co-owners and as per the settled law on this issue the tenancy cannot be equated with the ownership. The ownership is the bundle of rights but rights of the tenants are limited. Admittedly, the assessee's tenancy was converted ownership and that can be the subject matter of the capital gain as it is a 'transfer' within the meaning of section 2(47) r.w.s. 45 of the I.T. Act.
8. Core question of controversy to be decided is whether the said transfer was in the A.Y. 2007-08. Admittedly, the assessee made the compliance on 4.11.2004 and in our opinion this issue has to go in favour of the assessee as the transfer took place on the date i.e. 4.11.2004 when the agreement in compliance with the Consent Decree was executed and the assessee vacated the property, which was subject matter of the litigation between her and the co-owners.
9. We are unable to accept the plea of the Ld. Counsel that at the , the transfer could be in the year 1999 when the Consent Decree was passed for the reason that though the Consent Decree was passed it was subject to certain conditions and on compliance of the concessions only the assessee was to be conferred with the ownership of the alternate premises agreed to be given in the Shriniketan building by co-owners/landlords of the property. We, therefore, hold the transfer took place on 04.11.2004 and not on 22.02.2007 if the Deed of confirmation was registered on that date. We, 6 M.A.No. 281/Mum/2012 accordingly confirm the order of the Ld. CIT (A) on above reasons that capital gain cannot be brought to tax in this year and accordingly we decide question nos.1 & 2 against the revenue."
5. As is clearly evident, the decision of the Hon'ble Bombay High Court passing the consent decree in the case of the assessee was duly taken into consideration by the Tribunal along with other relevant facts of the case and other documentary evidence to come to the conclusion that the transfer took place on 04- 11-2004. In our opinion, it, therefore, cannot be said that the decision was rendered by the Tribunal without considering the order of the Hon'ble Bombay High Court or any other relevant aspects of the case as alleged by the assessee in the present Miscellaneous Application. As regards the date of transfer, the Tribunal no doubt has taken the date of transfer as 04-11-2004 as against 28-05-1999 as claimed by the assessee which was accepted by the learned CIT(Appeals) and 22-02-2007 as taken by the AO. The question, however, is whether the same constitutes a mistake apparent from record which can be rectified u/s 254(2). As rightly contended by the learned DR in this regard, the date of transfer has been held to be 04-11-2004 by the Tribunal by taking a specific view and it is not permissible to review the decision of the Tribunal in the guise of rectification u/s 254(2). The learned counsel for the assessee has submitted that the entire order of the Tribunal dated 18th January, 2012 can be recalled and the appeal of the Revenue can be heard in order to decide afresh the issue relating to the exact date of transfer whether 28- 05-1999 or 22-02-2007. In our opinion, even this recourse will lead to the review of the decision of the Tribunal on the issue of date of transfer indirectly which is beyond the scope of section 254(2) because what is not permissible directly cannot be done even indirectly. We are, therefore, of the view that there is no mistake apparent from record in the order of the Tribunal dated 18th January, 2012 (supra) 7 M.A.No. 281/Mum/2012 which can be rectified u/s 254(2). Accordingly, we dismiss this Miscellaneous Application filed by the assessee being devoid of any merit.
6. In the result, the Miscellaneous Application of the assessee is dismissed.
Order pronounced Court on this 9th day of Nov., 2012.
Sd/- Sd/-
(Amit Shukla) (P.M. Jagtap)
Judicial Member Accountant Member
Mumbai,
Dated : 9th Nov., 2012.
Wakode
Copy to :
1. Applicant.
2. Respondent
3. C.I.T.
4. CIT(A)
5. D.R., H-Bench.
(True copy)
By Order
Assistant Registrar,
ITAT, Mumbai.
8
M.A.No. 281/Mum/2012
Date Initials
Draft dictated on 07-11-12 Sr. P.S.
Draft placed before the author 08-11-12 Sr. P.S.
Draft proposed and placed before the second AM/JM
Member
Draft discussed/approved by Second AM/JM
Member
Approved Draft comes to the Sr. PS Sr. P.S.
Kept for pronouncement on Sr. P.S.
File sent to the Bench Clerk Sr. P.S.
Date on which file goes to the Head Clerk
Date of dispatch