K. Jagannatha Shetty, J.
1. The Income-tax Appellate Tribunal, Bangalore Bench, has referred the following two question for the opinion of this court :
'1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the sum of Rs. 2.5 lakhs received by the assessee was not a revenue receipt but a capital receipt
2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in refusing to entertain the alternative ground of the Department that capital gains on the transfer of the leasehold rights should be brought to tax in these proceedings in receipt of the receipt of Rs. 2.5 lakhs ?'
2. The facts behind the legal formulations are as follows :
The assessee is the daughter of Sri Humayun Mirza, who was the owner of the property known as ''Cubbon Lodge', No. 3, Rajbhavan Road, Bangalore. On June 29, 1967, he made an oral gift of the property in favour of his minor daughter, Maryam Mirza, and the gift was accepted by her mother on behalf of the minor daughter. The assessee attained majority on January 12, 1970. While she was a minor, on May 22, 1969, Sri Humayun Mirza entered into an agreement with one Sri S. V. Jannu to lease out the said property for a period of 50 years for a rent of Rs. 1,000 per month and a sum of Rs. 1,00,000 was received as a premium from Sri S. V. Jannu. The lease deed did not mention about the further sum of Rs. 1,50,000, but receipt of the said sum was, however, admitted by Sri Humayun Mirza. He could not but admit it since a receipt to that effect was found in the possession of Sri Humayun Mirza.
3. The Income-tax Officer brought to tax a sum of Rs. 2,50,000 as revenue receipt taking the view that that amount was received in the year in which the assessee attained majority.
4. Aggrieved by the said order of the Income-tax Officer, the assessee went in appeal before the Appellate Assistant Commissioner, who held that the Income-tax Officer was not justified in assessing the sum of Rs. 2,50,000 as a revenue receipt in the assessee's hands. The Appellate Assistant Commissioner held that it must be considered as a capital receipt.
5. Aggrieved by the order of the Appellate Assistant Commissioner, the Department appealed to the Tribunal. The Tribunal has dismissed the appeal. The relevant portion of the Tribunal's order runs as follows :
'Against this order, the Department has filed the present appeal. The learned departmental representative did not place any material to show that the receipt of Rs. 2.5 lakhs was a revenue receipt. The learned counsel for the assessee has relied on certain rulings reported in : 7ITR536(Patna) (CIT v. Visweshwar Singh) and : 9ITR313(Patna) (Province of Bihar v. Maharaja Pratap Udai Nath) to hold that the receipt was of a capital nature. That the salami received by the assessee or her father is a capital receipt is clear from the above rulings. It was for the Department to make out a case that the amount paid in lump sum represented the lease rent and not the consideration for parting with the property. In the absence of any material in this regard, we confirm the order of the Appellate Assistant Commissioner that the receipt of Rs. 2.5 lakhs was of a capital nature and not a revenue nature.'
6. It will be seen from the above order that the Tribunal rested its conclusion solely on the ground that the Department did not place any material to show that the receipt of Rs. 2,50,000 was in the nature of revenue receipt. The Tribunal has stated that it would be for the Department to lead evidence to prove that the amount paid in lump sum represented the lease rent and not the consideration for parting with the property. The view taken by the Tribunal appears to be right.
7. In Maharaja Chintamani Saran Nath Sah Deo v. CIT : 82ITR464(SC) , the Supreme Court has observed thu :
'The principles on which the courts have acted whenever a question has arisen whether a payment described as a salami is capital or revenue receipt are well-settled. Salami is a single payment made for the acquisition of the right of the lessor by the lessee to enjoy the benefits granted to him by the lease. That general right may properly be regarded as a capital asset and the money paid to purchase it may properly be held to be a payment on capital account. But, merely because a certain amount paid to the lessor is termed as salami, it does not follow that no inquiry can be made to determine whether it has or had not an element of revenue receipt in the shape of advance payment of royalty or rent. The onus, however, is upon the Income-tax Authorities to show that there exist facts and circumstances which would make payment of what has been called salami income.
The position may be summed up in this way. When the interest of the lessor is parted for a price the price paid is premium or salami but the periodical payments made for the continuous enjoyment of the benefits under the lease are in the nature of rent; the former is a capital receipt and the latter a revenue receipt. Parties may camouflage the real nature of the transaction by using clever phraseology and, therefore, it is not the form but the circumstances of the transaction that matter. The nomenclature used may not be decisive or conclusive but it helps the courts, having regard to the other circumstances, to ascertain the intention of the parties (See CIT v. Panbari Tea Co. Ltd. : 57ITR422(SC) .'
8. It will be seen from the above pronouncement that the onus is on the Revenue to show that what was stipulated in the lease is not decisive or conclusive. The Revenue must produce acceptable evidence to prove the contrary. We are sorry to note that the departmental representative in the instant case appears to have soft pedaled the case and failed to produce evidence regarding the real nature of the transaction. The Tribunal, of course, could not have done anything better in the absence of any evidence form the Revenue. The Tribunal, on the material, was justified in holding that the receipt of Rs. 2,50,000 was of a capital nature and not of a revenue nature on the facts.
9. The second question is, whether the Tribunal was justified in refusing to entertain the alternative ground of the Revenue that capital gains on the transfer of the leasehold rights in respect of Rs. 2,50,000 should be brought to tax in these proceedings. This ground was not raised in the memorandum of appeal, much less was it pleaded before the Appellate Assistant Commissioner. It was only at the time of hearing of the appeal before the Tribunal that a faint attempt appears to have been made with an oral request to raise that contention. The Tribunal, in our opinion, was perfectly justified in refusing leave to allow that contention at that belated stage. This court has upheld such an action of the Tribunal in Consolidated Coffee Estate Ltd. v. CIT (ITRC No. 64 of 1972 - dated 26-5-1974) (See also the decisions of the Supreme Court in Manji Dana v. CIT : 60ITR582(SC) and Moti Ram v. CIT : 34ITR646(SC) .
10. In the result, we answer both the questions in the affirmative and against the Revenue.
11. The parties will pay and bear their own costs.