Itxa/1574/2012 Of Commissioner Of Income Tax - 11 , Thane v. Shri Raju Shete

itxa-1574-12.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.1574 OF 2012 WITHINCOME TAX APPEAL NO.1677 OF 2012(NOT ON BOARD) … The Commissioner of Income Tax-IIv/s.Shri Raju Shete ...Appellant ...Respondent … Mr.Sureshkumar for the Appellant.Mr.J.D.Mistri, Sr.Advocate i/b Mr. Atul Jasani for the Respondent. ... CORAM : S.C.DHARMADHIKARI & A.A. SAYED, JJ. DATED : 4 DECEMBER 2014 P.C. We have heard Mr.Sureshkumar in support of this Appeal. It challenges the order passed by the Income Tax Appellate Tribunal, Mumbai Bench dated 6 June 2012 in Income Tax Appeal No.2902/Mum/2011 and Income Tax Appeal No.2904/Mum/2011. The Assessment Year is 2006-07. 2.The order was passed on 8 March 2011 by the Commissioner of Income Tax (Appeals)-II, Thane in exercise of his powers under section 263 of the Income Tax Act, 1961. 3.That order was challenged by the Assessee in two Appeals. itxa-1574-12.doc 4.The argument was that the Assessing Officer's order cannot be termed as erroneous and prejudicial to the interest of the Revenue, because he has taken a view and on facts, this view is imminently possible. The Tribunal was convinced with this argument because it found that four share holders of Unisole Infraservices Services Pvt.Ltd. executed an agreement with M/s. Radhakrishna Hospitality Pvt. Ltd., under which all the shares of Unisole Infraservices were purchased. The initial consideration of Rs.2.7 crores was received and that was brought to tax. On that exemption under section 54EC of the Income Tax Act, 1961 was claimed. The assessment was completed by the Assessing Officer and he passed an order on 24 December 2008 accepting the long term capital gain as declared by the Assessee in the return of income. 5.These issues were examined by the Commissioner and he concluded that the consideration under the agreement was determined at Rs. 20 crores in terms of clause 3.2 of the agreement between parties. Therefore that sum should have been brought to tax and not an initial consideration alone. itxa-1574-12.doc 6.The Tribunal pointed out the fallacy in this conclusion of the Commissioner by referring to the agreement and particularly clause 3.2, that set out outer and maximum limit of Rs.20 crores, which the purchaser was willing to pay to the Assessee. It made initial payment of Rs.2.7 crores and clause 3.2 was conditional, inasmuch as, further sum was payable depending on the performance and financial position relating to four financial years from 31 March 2007 to 31 March 2010. Therefore something which was conditional or dependent upon several factors being complied with, merely with the outer limit the amount of Rs.20 crores could not have been brought to tax on the footing that it is an initial consideration or payment. It is, in these circumstances, that the Tribunal concluded that the Assessing Officer's view was possible and could not have been interfered with in the revisional jurisdiction. 7.Such a finding of fact cannot be termed as perverse or vitiated by any error of law apparent on the face of the record. We do not find any merit in this Appeal, as it raises no substantial question of law. It is accordingly dismissed. No costs. itxa-1574-12.doc 8. This order shall also dispose of Income Tax Appeal No.1677 of 2012 as similar question on similar facts has been raised. That Appeal is also dismissed. No costs. (A.A. SAYED, J.) (S.C.DHARMADHIKARI,J.)