COMMISSIONER OF INCOME TAX vs. EICHER GOODEARTH LTD.

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ITA - 8 / 2002HC Delhi13 August 20021 pages
For Petitioner: RASHMI CHOPRA
AI SummaryPartly Allowed

What did the High Court hold?

The High Court admitted the appeal and framed a substantial question of law regarding the taxability of the Rs. 6,83,017 received by the assessee on surrender of tenancy rights as a casual and non-recurring receipt under Section 10(3) of the Income Tax Act. The Tribunal had decided in favour of the assessee, relying on its own prior order for assessment year 1989-90 and the fact that similar treatment was given to foreign exchange fluctuation losses by the assessing officer for other assessment years, with no change in circumstances. The Revenue's counsel did not dispute these factual findings. Consequently, the High Court found no fault with the Tribunal's order on this issue, given that a similar claim had attained finality. The appeal was admitted for further hearing, and the appellant was directed to file paper books. The operative direction was to list the appeal for hearing in the regular course.

What were the facts?

The Commissioner of Income Tax (Revenue) has appealed against an order of the Income Tax Appellate Tribunal (ITAT). The ITAT had held that an amount of Rs. 6,83,017 received by Eicher Goodearth Ltd. (assessee) on the surrender of tenancy rights was a casual and non-recurring receipt, exempt from tax under Section 10(3) of the Income Tax Act. The ITAT's decision was based on its earlier order for assessment year 1989-90 and the fact that the assessing officer had allowed losses due to foreign exchange fluctuation in assessment years 1986-87 and 1990-91. The Revenue's counsel did not dispute the factual position. The High Court admitted the appeal and framed a substantial question of law.

What were the issues?

1. Whether, in the facts and circumstances of the case, the ITAT was correct in holding that the amount received by the assessee on surrender of tenancy rights, amounting to Rs. 6,83,017, is a casual and non-recurring receipt under Section 10(3) of the Income Tax Act, not chargeable to tax? Assessee's Contentions: The ITAT held the receipt to be casual and non-recurring, relying on its prior decision for assessment year 1989-90. The assessee also pointed to the assessing officer's allowance of foreign exchange fluctuation losses for assessment years 1986-87 and 1990-91, and the absence of changed circumstances in the current assessment year. Revenue's Contentions: The Revenue's learned senior standing counsel did not dispute the factual position as noted by the Tribunal. No specific arguments or reliance on authorities were recorded for the Revenue.

Which sections of the Income-tax Act were involved?

Section 10(3)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF DELHI AT NEW DELHI

ITA 8/2002

COMMISSIONER OF INCOME TAX ..... Appellant. Through Mr.R.D.Jolly with Ms.Rashmi Chopra.

versus

EICHER GOODEARTH LTD. ..... Respondent Through Mr.Ajay Vohra with Mr.Vinay Vaish.

CORAM: HON'BLE MR. JUSTICE D.K. JAIN HON'BLE MS. JUSTICE SHARDA AGGARWAL

O R D E R ----------- 13.08.2002

Heard. Admit. The following substantial question of law is framed for adjudication:- "Whether in the facts and circumstances of the case the ITAT was correct in holding that the amount received by the assessee on surrender of tenancy rights, amounting to Rs.6,83,017, is a casual and non recurring receipt u/s 10(3) of the I.T.Act not chargeable to tax?

Insofar as, the first question proposed by the Revenue is concerned, we find that the Tribunal has decided the issue in favour of the assessee by placing reliance on its earlier order in respect of assessment year 1989-90 and further the fact that in respect of assessment years 1986-87 and 1990-91 loss on account of foreign exchange fluctuation had been allowed by the assessing officer himself. The Tribunal has also found as a fact that there has been no change in the circumstances in the present assessment year. Mr.Jolly, learned senior standing counsel for the Revenue does not dispute the afore-noted factual position. A similar claim having attained finality, no fault can be found with the order of the Tribunal on the issue. The appellant shall file within three months ten copies of the cyclostyled paper books, containing all documents on which reliance was placed before the Tribunal, including any order/orders, either in the case of the assessee itself or in case of any other assessee, which has been followed by the Tribunal. The appeal be listed for hearing in the regular course.

D.K. JAIN, J

SHARDA AGGARWAL, J AUGUST 13, 2002 'ss'

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