1 itxa1120-13+1 sas IN HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.1120 OF 2013 Commissioner of Income Tax-21, Mumbai ..Appellant. V/s. Smt. Shashikala M.Shetty ..Respondent. AND INCOME TAX APPEAL NO.1391 OF 2013 Commissioner of Income Tax-21, Mumbai Appellant. V/s. Mrs. Kasturi Vasanji Mamania ..Respondent. Ms.S.V.Bharucha for appellant in both appeals. Mr.Jitendra Jain with Ms.Niyati Hakani i/b. M/s. PDS legal for respondent in both appeals. CORAM : S.C.DHARMADHIKARI AND A.K. MENON, JJ. DATED : 17TH MARCH, 2015 P.C. :- 1. revenue is aggrieved by order passed by Mumbai Bench of Income Tax Appellate Tribunal in batch of appeals for assessment year 2007-08. One of appeal filed pertains to present assessee. 2. Ms. Bharucha appearing for revenue in support of appeal submits that order of Tribunal raises ::: Uploaded on - 20/03/2015 ::: Downloaded on - 31/12/2018 15:28:26 ::: 2 itxa1120-13+1 substantial questions of law which have been formulated by revenue in paper-book. She submits that Commissioner of Income Tax (Appeals) as also Tribunal erred in holding that sale of building by assessee was capital asset and not stock in trade, which could have led even to adventure in nature of trade. 3. Commissioner as also Tribunal found that property situated at Andheri (East), Mumbai admeasuring 3221.00 sq. mtrs. was purchased from M/s. Chemosyn Ltd. under deed of conveyance dated 26 th May, 1989 duly registered. That was purchased by assessee before us Mrs.Shashikala M.Shetty and Mrs.Kasturi Vasanji Mamamia. From date of acquisition to 16th January, 2003, two owners were enjoying rental income from property having leased various units in said property to various tenants. On 16th January, 2003 they formed partnership firm in name of Bluechip Construction Co. and with intent to develop property, they sought permission for redevelopment and it was granted by Municipal Corporation of Greater Mumbai by issuing commencement certificate dated 27th April, 2004. partnership firm was to ::: Uploaded on - 20/03/2015 ::: Downloaded on - 31/12/2018 15:28:26 ::: 3 itxa1120-13+1 be contractor for development and reconstruction of building and after formation of same and obtaining certificate, acquisition of transfer development rights (TDR), assessee received offer from M/s.Multiple Commodity Exchange of India Ltd. Though building was completed to extent of 60% but in light of lucrative offer, assessee disposed of property and construction undertaken thereon, which has been subject matter of agreement dated 2nd February, 2007. It is thereafter that revenue called upon assessee to reply as to why this transaction should be not construed as adventure in nature of trade. However, Tribunal found that beyond solitary offer from M/s.Multiple Commodity Exchange, there was none other. Similarly, even after redevelopment and reconstruction, both assessee were intending to enjoy rental income as before by letting units to tenants. It is in this background that Tribunal held that sale in favour of M/s.Multiple Commodity Exchange of India Ltd. was capital asset and was not disposal of stock in trade which could have led to adventure in nature of trade. That is how orders were set aside and gains were allowed to be treated as capital gains with ::: Uploaded on - 20/03/2015 ::: Downloaded on - 31/12/2018 15:28:26 ::: 4 itxa1120-13+1 allowable deductions under section 54F and 54EC of I.T. Act. Given this background and which is admitted, we do not see how Tribunal's order can be termed as perverse. It has applied correct and reliable test by allowing appeals as noted above and that was arrived on basis of record and relevant facts and circumstances. It was, therefore, view imminently possible and cannot be termed as perverse or vitiated by any error of law apparent on face of record. We do not find any merit in revenue's appeal and it does not raise any substantial question of law. appeal is dismissed. No order as to costs. INCOME TAX APPEAL NO.1391 OF 2013 4. By consent of parties, we take Income Tax Appeal (L) No.734 of 2013 and now numbered as Income Tax Appeal No.1391 of 2013 on board. In light of admitted facts and admitted questions, which are identical to present cases, we are of view that said appeal also deserves to be dismissed. For reasons recorded by us as above, this appeal fails and is dismissed. No order as to costs. (A.K. MENON, J.) (S.C.DHARMADHIKARI, J.) ::: Uploaded on - 20/03/2015 ::: Downloaded on - 31/12/2018 15:28:26 ::: Commissioner of Income-tax-21, Mumbai v. Shashikala M. Shetty