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May, 27th 2013
%                                      Judgment delivered on: 22.03.2013

+       ITA 162/2013

        COMMISSIONER OF INCOME TAX ­VII                             ..... Appellant


        NEERA BHANDARI                                          ..... Respondent

Advocates who appeared in this case:
For the Appellant            : Mr Sanjeev Rajpal, Sr. Standing Counsel
For the Respondent           : Mr Satyen Sethi, Adv.




CM 4947/2013

        The delay in refiling the appeal in condoned.

        The application is disposed of.

ITA 162/2013

        This appeal is directed against the order dated 19.07.2012 passed

by the Income Tax Appellate Tribunal in ITA No.3773/Del/2009

pertaining to the assessment year 2006-07.

ITA 162/2013                                                             Page 1 of 6
2.      The revenue was in appeal before the Appellate Tribunal on the

following grounds: -

        "1. The Ld. CIT (A) erred in law and on facts in deleting
        the addition of `1,07,25,000/- made by the Assessing
        Officer on account of short term capital gains.

        2. The Ld. CIT (A) erred in law and on facts in deleting
        the addition of `6,72,910/- made by the Assessing Officer
        on account of Income from House Property."

Additional grounds had also been taken, which were in any event

related to ground No.1. The additional grounds were as under: -

        "(i) The CIT(A) has erred in law and on the facts of the
        case in holding that the sale of the property relates back to
        date on which the assessee's father, Sh. A.P.Bajaj was
        alive and that consequently the will executed by the said
        Sh.A.P.Bajaj is of no consequence, when as per the
        assessee's own submission (reproduced at Para 5.5 of the
        CIT(A)'s order, there was no formal agreement of sale in
        this case and a mere receipt of the initial advance of `7.5
        lakhs can not be treated as an agreement for sale,
        particularly when the sale deed executed by the son of Sh.
        A.P.Bajaj on 08.11.2005 (after the death of Sh. Bajaj) does
        not make any mention of any earlier agreement of sale and
        when there is no evidence/indication of the date, if any, on
        which possession of the land was given to the buyers in
        pursuance of any agreement of sale executed during the
        life time of Sh. A.P.Bajaj.

        (i)     The Ld. CIT(A) has erred in law and on facts in
        treating the amount of `1,05,00,000/- received by the
        assessee from her brother as a gift within the meaning of

ITA 162/2013                                                   Page 2 of 6
        Sec. 56(2)(v) of the I.T.Act 1961 and not as a part of the
        sale consideration received in pursuance of the will of

Insofar as the first ground and the additional grounds are concerned the

issue is with regard to the addition of `1,07,25,000/- made by the

assessing officer as short term capital gains. That has been deleted by

the Tribunal.    The facts are that the assessee received a sum of

`1,05,00,000/- from her brother Pramod Kumar Bajaj (`72 lakhs

during assessment year 2005-06 and a further sum of `33 lakhs during

assessment year 2006-07). This receipt was in accordance with the

direction given by her late father Sh. A P Bajaj in his will. In the will

it was stated that in case the agricultural land at village Badshahpur,

Distt. Gurgaon, Haryana is sold under any circumstance by said

Pramod Kumar Bajaj, 30% of the sale consideration would be given to

the assessee (Smt. Neera Bhandari). It is in these circumstances that

the assessee received the above sums of money from her brother which

was equal to 30% of the sale proceeds of the land. The said sum was

received in its entirety after the demise of the father (late Sh. A P

Bajaj). The assessing officer treated the sale consideration as short

term capital gains and added it to the total income of the assessee. The

ITA 162/2013                                                 Page 3 of 6
assessing officer also denied the claim of exemption under Section

54EC to the extent of `35,25,000/- made by the assessee.

3.      The Commissioner of Income Tax (Appeals) deleted the

addition of `1,07,25,000/-.    The Tribunal on different reasons has

confirmed the deletion.

4.      The learned counsel for the appellant submitted before us that

the Tribunal had erred in law inasmuch as the receipt of the said sum

of `1,05,00,000/- by the assessee from her brother had been received

by the brother, in part, during the lifetime of the father in November,

2004. It is only thereafter, that the assessee's father late Sh. A P Bajaj

passed away on 24.11.2004.

5.      We feel that even if we accept the position as advanced by the

learned counsel for the appellant, it is apparent that the assessee

received the said sum of `1,05,00,000/- as inheritance from her father.

This would become clear from the fact that late Sh. A P Bajaj had

clearly indicated in his Will that in case the property is sold, 30% of

the sale proceeds would be given to the assessee. The fact that the

property was agreed to be sold during the lifetime of the father and

ITA 162/2013                                                  Page 4 of 6
some part consideration had been received during the lifetime would

only imply that the condition upon which the assessee was to receive

the said 30% of the sale consideration had already been satisfied

during his lifetime. In other words, the assessee's share out of the said

consideration became payable to her directly under the will on the

death of the father. Even if we look at the matter in this perspective

the receipt in the hands of the assessee cannot be regarded as income.

However, the Tribunal has taken a different approach by holding that

even if it is regarded as income the assessee would be entitled to the

benefit of income under Section 56(2)(v) of the Income Tax Act, 1961.

Either way we look at the issue, the answer is the same. Therefore,

insofar as this aspect of the matter is concerned no interference with

the order of the Tribunal is called for.

6.      As regards the second gound raised before the Tribunal with

regard to the addition of `6,72,910/-, that issue was decided in favour

of the assessee in respect of the assessment year 2005-06 by the CIT

(Appeals) and it has not been questioned by the revenue before the

Tribunal.      Therefore, following the said decision, the Tribunal

ITA 162/2013                                                 Page 5 of 6
confirmed the view taken by the CIT (Appeals). Even on that aspect,

no interference is called for.

7.      No substantial question of law arises for our consideration.

        The appeal is dismissed.

                                        BADAR DURREZ AHMED, J

                                                       R.V.EASWAR, J
MARCH 22, 2013

ITA 162/2013                                                  Page 6 of 6
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