Income from transfer of leased premises is taxable as Capital Gains under the Income-tax Act

Income from transfer of a leased premises  amounts to extinguishment of taxpayer’s right in the capital asset and therefore taxable as ‘Capital Gains’ under the Income-tax Act. Mumbai bench of Income-tax Appellate Tribunal (the Tribunal) in the case of ACIT Vs United Motors (I) Ltd. (2009-TIOL-693-ITAT-MUM) has held that income from transfer of a leased premises without transferring its own business amounts to extinguishment of the taxpayer’s right in the capital asset as per section 2(47) of the Income-tax-tax Act, 1961 (the Act). The Tribunal also observed that such transfer of ...