G. Venkataswami Naidu And Co. vs Commissioner Of Income-Tax, Madras on 18 April, 1955
4. On behalf of department, it was contended that said leasehold land
was acquired by assessee for business purposes and transferring it to
developer for development was in the nature of trade. Ld. Departmental
Representative referred decision of Hon'ble Apex Court in the case of G.
Venkataswami Naidu & Co. Vs CIT 35 ITR 594. On the other hand Ld. AR
submitted that assessee is a salaried employ and said leasehold plot was in
his position for the last 44 years. It was used by a partnership firm and
was treated as capital asset. The lease was renewed for a period of 49 years
with an extendible further period of 49 years. He submitted that firm was
dissolved in 2002 and thereafter assessee entered into a Development
Agreement against consideration of Rs. 44 lakhs. The assessee paid a sum
of Rs. 10,00,000/- to Trust to allow assessee to transfer his leasehold rights
to Developer.