Mayank Kishor Tejura v. ITO - Taxpublishers.in

SUBSCRIBE FOR FULL CONTENT


The Tax Publishers2024 TaxPub(DT) 1205 (Mum-Trib) IN THE ITAT, MUMBAI BENCH AMIT SHUKLA, J.M. & GAGAN GOYAL, A.M. Mayank Kishor Tejura v. ITO ITA No. 3777/MUM/2023 11 March, 2024 Assessee by: Vimal Punamiya Revenue by: Mahita Nair ORDER *Amit Shukla. J.M.* The aforesaid appeal has been filed by the assessee against Order dated 25-8-2023 passed by NFAC, Delhi for the quantum of assessment passed under section 143(3) for the assessment year 2013-14. 2. In various grounds of appeal assessee has challenged taxing of compensation received by the assessee of Rs. 75,00,000 for vacating the flat under the head income from other sources instead of capital gain and thereby, denying the assessees claim for deduction under section 54F. Alternatively, it has been submitted that compensation received for vacating and handing over the peaceful possession of the suit flat to be capital receipt. 3. The brief facts are that assessee received Rs. 75,00,000 from Overseas Impex Private Limited (hereinafter referred to as OIPL) for vacating the flat which he has occupied with his family members for over 40 years. The facts and the background of the entire issue have been explained before us in the following manner:- 1. Overseas Impex (P) Ltd. (OIPL) was a tenant of a residential flat being Flat No. 15, 4th Floor, Park View Building, Little Gibbs Road, Malabar Hill, Mumbai - 400 006 since 1965. The Company had been the tenant by way of Leave and License agreement dated 1-5-1965 between Mr. Amrit Sagar Puri (Landlord) and the company (Tenant). 2. The original agreement between OIPL and Landlord was for a period of 5 years. However, at the end of agreement, OIPL refused to vacate the flat. Mr. Puri, the Landlord, filed a suit against OIPL. The Court ruled against the Landlord and held OIPL to be a deemed tenant of the residential flat The Landlord, thereafter, filed several suits against the earlier ruling i.e. suit Nos. 596/1632 of 1998 and Suit No. 827/1306 of 2003 to evict OIPL from the said premises. 3. As such, while the tenancy right of the flat was with OIPL, the flat was occupied by Late Shri Kishor Tejura (who was then a director of OIPL in 1965) along with his family & brother's & uncles as a joint family. Many of the occupants of the Tejura family moved on or passed away over the years including the late Shri Kishor Tejura. The present directors of OIPL respectively Mr. Mayank Tejura and Mr. Rakesh Tejura were born & lived in the flat from childhood along with their parents, uncles & cousins whe were all occupying the said flat as joint family for a very long period of time since 1965. 4 During the pending status of the suits filed by Mr. Puri against the company, the company received offer from Mr. Puri for making out of court settlement and vacating the flat. Mr. Puri offered to pay monetary compensation to the company for having the flat vacated from its directors & family members residing in the flat & handing over peaceful & vacant possession of the same SUBSCRIBE FOR FULL CONTENT

The Tax Publishers2024 TaxPub(DT) 1205 (Mum-Trib)

IN THE ITAT, MUMBAI BENCH

AMIT SHUKLA, J.M. & GAGAN GOYAL, A.M.

Mayank Kishor Tejura v. ITO

ITA No. 3777/MUM/2023

11 March, 2024

Assessee by: Vimal Punamiya

Revenue by: Mahita Nair

ORDER

Amit Shukla. J.M.

The aforesaid appeal has been filed by the assessee against Order dated 25-8-2023 passed by NFAC, Delhi for the quantum of assessment passed under section 143(3) for the assessment year 2013-14.

2. In various grounds of appeal assessee has challenged taxing of compensation received by the assessee of Rs. 75,00,000 for vacating the flat under the head income from other sources instead of capital gain and thereby, denying the assessees claim for deduction under section 54F. Alternatively, it has been submitted that compensation received for vacating and handing over the peaceful possession of the suit flat to be capital receipt.

3. The brief facts are that assessee received Rs. 75,00,000 from Overseas Impex Private Limited (hereinafter referred to as OIPL) for vacating the flat which he has occupied with his family members for over 40 years. The facts and the background of the entire issue have been explained before us in the following manner:-

1. Overseas Impex (P) Ltd. (OIPL) was a tenant of a residential flat being Flat No. 15, 4th Floor, Park View Building, Little Gibbs Road, Malabar Hill, Mumbai - 400 006 since 1965. The Company had been the tenant by way of Leave and License agreement dated 1-5-1965 between Mr. Amrit Sagar Puri (Landlord) and the company (Tenant).

2. The original agreement between OIPL and Landlord was for a period of 5 years. However, at the end of agreement, OIPL refused to vacate the flat. Mr. Puri, the Landlord, filed a suit against OIPL. The Court ruled against the Landlord and held OIPL to be a deemed tenant of the residential flat The Landlord, thereafter, filed several suits against the earlier ruling i.e. suit Nos. 596/1632 of 1998 and Suit No. 827/1306 of 2003 to evict OIPL from the said premises.

3. As such, while the tenancy right of the flat was with OIPL, the flat was occupied by Late Shri Kishor Tejura (who was then a director of OIPL in 1965) along with his family & brother's & uncles as a joint family. Many of the occupants of the Tejura family moved on or passed away over the years including the late Shri Kishor Tejura. The present directors of OIPL respectively Mr. Mayank Tejura and Mr. Rakesh Tejura were born & lived in the flat from childhood along with their parents, uncles & cousins whe were all occupying the said flat as joint family for a very long period of time since 1965.

4 During the pending status of the suits filed by Mr. Puri against the company, the company received offer from Mr. Puri for making out of court settlement and vacating the flat. Mr. Puri offered to pay monetary compensation to the company for having the flat vacated from its directors & family members residing in the flat & handing over peaceful & vacant possession of the same