Cherran Propertiees Limited, CHENNAI V. ACIT, Coimbatore

ITA 1114/CHNY/2014

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 3986 (ITAT-CHENNAI)
• Duration Of Justice: 4 year(s) 9 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-02-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 30-04-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANAT KUMAR RAHA
• Assessee Lawyers: S SRINIRANJANI

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , ! ' # , % #& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ./ ITA NO.1114/CHNY/2014 ) *) / ASSESSMENT YEAR : 2004-05 M/S CHERRAAN PROPERTIES LIMITED, CHERAN TOWERS, 78, ARTS COLLEGE ROAD, COIMBATORE 641 018. PAN : AABCC 0860 G V. THE ASSISTANT COMMISSIONER OF INCOME TAX, COMPANY CIRCLE I(1), COIMBATORE. (,-/ APPELLANT) (./,-/ RESPONDENT) ,- 0 1 / APPELLANT BY : SMT. S. SRINIRANJANI, ADVOCATE ./,- 0 1 / RESPONDENT BY : SHRI SANAT KUMAR RAHA, JCIT 2 0 3% / DATE OF HEARING : 17.01.2019 45* 0 3% / DATE OF PRONOUNCEMENT : 06.02.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -1, COIMBATORE , DATED 23.09.2013 AND PERTAINS TO ASSESSMENT YEAR 2004-05. 2. THIS APPEAL OF THE ASSESSEE WAS EARLIER DISPOSED OF BY THIS TRIBUNAL BY AN ORDER DATED 19.05.2017. ON APPEAL B Y THE ASSESSEE, THE HIGH COURT BY JUDGMENT DATED 14.12.2007 CONDONED TH E DELAY IN FILING 2 I.T.A. NO.1114/CHNY/14 THE APPEAL AND REMITTED BACK THE MATTER TO THE FILE OF THE TRIBUNAL TO DECIDE THE APPEAL ON MERIT. ACCORDINGLY, THE APPEA L WAS POSTED FOR FINAL DISPOSAL. 3. SMT. S. SRINIRANJANI, THE LD.COUNSEL FOR THE ASS ESSEE, SUBMITTED THAT THE ONLY ISSUE ARISES FOR CONSIDERATION IS CLA SSIFICATION OF HEAD OF RENTAL INCOME RECEIVED BY THE ASSESSEE. ACCORDING TO THE LD. COUNSEL, THE BUSINESS OF THE ASSESSEE IS TO ACQUIRE PROPERTI ES AND EARN INCOME BY LETTING OUT THE SAME. THEREFORE, ACCORDING TO THE LD. COUNSEL, THE RENTAL INCOME RECEIVED BY THE ASSESSEE HAS TO BE CLASSIFIE D AS INCOME FROM BUSINESS AND NOT AS INCOME FROM HOUSE PROPERTY. ON A QUERY FROM BENCH REGARDING THE NATURE OF BUILDING, THE LD.COUN SEL COULD NOT CLARIFY THE ACTUAL NATURE OF BUILDING OTHER THAN CLAIMING T HAT IT IS A COMMERCIAL BUILDING. 4. WE HEARD SHRI SANAT KUMAR RAHA, THE LD. DEPARTME NTAL REPRESENTATIVE ALSO. ACCORDING TO THE LD. D.R., TH E NATURE OF THE BUILDING IS NOT BROUGHT ON RECORD BY THE ASSESSING OFFICER. THE LD. D.R. FURTHER SUBMITTED THAT THE ASSESSEE HAS DISCLOSED RENTAL RE CEIPT OF 48,20,471/- AND CHARGES FOR AMENITIES TO THE EXTENT OF 4,91,151/-. SINCE THE NATURE OF THE BUILDING WAS NOT BROUGHT ON RECORD AND THE A SSESSEE ALSO COULD NOT CLARIFY OTHER THAN CLAIMING TO BE COMMERCIAL PR OPERTY, THE LD. D.R. SUBMITTED THAT THE MATTER MAY BE REMITTED BACK TO T HE FILE OF THE 3 I.T.A. NO.1114/CHNY/14 ASSESSING OFFICER TO ASCERTAIN THE NATURE OF BUILDI NG AND THEREAFTER DECIDE THE ISSUE AFRESH. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE ASSESSEE CLAIMS THAT THE BUSINESS OF THE ASSESSEE IS TO ACQUIRE PRO PERTIES AND EARN RENTAL INCOME BY LETTING OUT THE SAME. FROM THE ASSESSMEN T ORDER, IT APPEARS THAT BUSINESS OF THE ASSESSEE IS PROPERTY DEVELOPME NT. THE NATURE OF BUILDING WAS NOT CONSIDERED BY ANY OF THE AUTHORITI ES BELOW. COPIES OF LEASE AGREEMENT ARE ALSO NOT FILED BEFORE THIS TRIB UNAL BY BOTH THE PARTIES. IT IS ALSO NOT KNOWN WHETHER THE ASSESSEE OWNS THE PROPERTY BY ITSELF OR IT WAS TAKEN ON LEASE. SINCE THE DETAILS OF THE PROPERTIES AND NATURE OF BUILDING WERE NOT BROUGHT ON RECORD BY BO TH THE AUTHORITIES BELOW, THIS TRIBUNAL IS OF THE CONSIDERED OPINION T HAT THE MATTER NEEDS TO BE RECONSIDERED BY THE ASSESSING OFFICER. ACCORDIN GLY, ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ENTIRE ISSUE IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSIN G OFFICER SHALL RE- EXAMINE THE ISSUE AND BRING ON RECORD THE NATURE OF BUILDING AND WHETHER IT IS OWNED BY THE ASSESSEE OR OTHERWISE IT IS IN T HE POSSESSION OF THE ASSESSEE AND THEREAFTER DECIDE THE MATTER AFRESH IN THE LIGHT OF THE JUDGMENT OF APEX COURT IN THE CASE OF CHENNAI PROPE RTIES & INVESTMENTS LTD. V. CIT (2015) 373 ITR 673, AFTER GIVING A REAS ONABLE OPPORTUNITY TO THE ASSESSEE. 4 I.T.A. NO.1114/CHNY/14 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 6 TH FEBRUARY, 2019 AT CHENNAI. SD/- SD/- ( ! ' # ) ( . . . ) (INTURI RAMA RAO) (N.R.S. GANESAN) % / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 7 /DATED, THE 6 TH FEBRUARY, 2019. KRI. 0 .389 :9*3 /COPY TO: 1. ,- /APPELLANT 2. ./,- /RESPONDENT 3. 2 ;3 () /CIT(A)-1, COIMBATORE 4. 2 ;3 /CIT-1, COIMBATORE 5. 9< .3 /DR 6. =) > /GF.