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July 2023

What’s In a Name? Immovable or Movable Could Be the Same

By Dr. Anup P. Shah, Chartered Accountant
Reading Time 15 mins
INTRODUCTION
Immovable property is the most ancient form of an asset which mankind has ever known. Its law and practice are multi-faceted, both from a legal and tax perspective.Different laws have defined the term ‘immovable property’ differently. These definitions are very relevant in determining whether or not a particular asset can be classified as an immovable property. For example, there is a difference in the rates of stamp duty on conveyance of a movable property and an immovable property. Similarly, GST is payable only in respect of sale of goods which are movable property and not on a completed immovable property. Recently, the Supreme Court in the case of the Sub Registrar, Amudalavalasa versus M/s Dankuni Steels Ltd., CA No. 3134-3135 of 2023, order dated 26th April, 2023 had an occasion to consider this issue in great detail. The Court analysed various definitions and propounded the settled principle that anything which is permanently affixed to land would also be immovable property. Let us examine this important proposition. FACTS OF THE CASE
In the case of Dankuni (supra), under an auction, the assets of a company which consisted of land, building, civil works, plant and machinery and current assets, were declared to be sold to the highest bidder for a consideration of Rs. 8.35 cr. A sale deed
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