DCIT 10(2)(2), MUMBAI V. M S LUVISH PROJECTS P.LTD, MUMBAI

ITA 1316/MUM/2015

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 8651 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 8 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-11-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 19-07-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 05-03-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUMAN KUMARSR
• Assessee Lawyers: NEHAN ANCHALIA ARS
• Keywords: Business income; Depreciation
• Section: 28

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI BEFORE SHRI R.C.SHARMA, ACCOUNTANT MEMBER AND SHRI PAWAN SINGH, JUDICIAL MEMBER ITA NO.1316/MUM./2015 (ASSESSMENT YEAR: 2010-11) D CIT - 10(2)(2) , ROOM NO.216-A, AAYAKAR BHAVAN, M.K. ROAD, MUMBAI-400020 . APPELLANT V/S M/S M.S. LUVISH PROJECTS PVT. LTD. 102, SANI ARMAA, RUT LANE, NEAR ISCON TEMPLE, JUHU, VILLE PARLE (W), MUMBAI-400043 PAN:-AAECM2300C . RESPONDENT ASSESSEE BY : SHRI PRATEEK JAIN & MS. NEHAN ANCHALIA ARS REVENUE BY : SHRI SUMAN KUMAR-SR. AR DATE OF HEARING 13.11.2017 DATE OF ORDER 13.11. 2017 O R D E R PER: PAWAN SINGH THIS APPEAL BY THE REVENUE U/S 253 OF INCOME-TAX AC T IS DIRECTED AGAINST THE ORDER OF LD. CIT(A)-17, MUMBAI , DATED 08.03.2015 FOR THE ASSESSMENT YEAR-2010-11. THE REV ENUE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT(A) ERRED IN HOLDING THE RENTAL RECEIPTS AS BUSINESS RECEIPTS WITHOUT CONSIDERING THAT THE ASSESSEE HAS RECEIVED 2 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 2 THE RENT FOR ALLOWING USER OF THE PROPERTY AND NOT FOR CARRYING OUT ANY SYSTEMATIC ACTIVITY WHICH IS THE PRE-CONDIT ION FOR BUSINESS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT(A) ERRED IN HOLDING THE RENTAL RECEIPTS AS BUSI NESS RECEIPTS WITHOUT CONSIDERING THAT THE ASSESSEE WAS PROVIDING SECURITY SYSTEM, CLEANING AND MAINTENANCE, LIGHTING, REPAIR AND MAINTENANCE OF LIFTS, PROVISION AND MANAGEMENT OF P ARKING SPACE, FIREFIGHTING EQUIPMENT AND INSURANCE OF THE PROPERTY AS PER ANNEXURE A OF THE RENT AGREEMENT, WHICH REPRESENT R UNNING AND MAINTENANCE EXPENSES FOR THE PROPERTY AND REGULAR A MENITIES AND FACILITIES FOR OCCUPANTS INCLUDING TENANTS. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT(A) ERRED IN HOLDING THE RENTAL RECEIPTS AS BUSI NESS RECEIPTS BY RELYING ON THE DECISION OF THE BOMBAY HIGH COURT IN THE CASE OF CIT VS. RUNWAL DEVELOPERS PVT. LTD. WITHOUT APPRECI ATING THAT IN THE CASE CITED SUPRA, BUSINESS CONDUCTING FEES AND BUSINESS FACILITY CHARGES COLLECTED FROM THE OCCUPANTS WERE TREATED AS RENT AND HELD TAXABLE UNDER THE HEAD INCOME FROM HOUSE P ROPERTY AND HENCE, THE RELIANCE IS MISPLACED. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT(A) ERRED IN HOLDING THE RENTAL RECEIPTS AS BUSI NESS RECEIPTS BY RELYING ON THE DECISION OF THE ITAT IN THE CASE OF M/S. KRISHNA LAND DEVELOPERS PVT. LTD. WITHOUT APPRECIATING THAT THE FACTS OF THE SAID CASE ARE COMPLETELY DISTINGUISHABLE FROM T HE FACTS OF THE PRESENT CASE AS IN THAT CASE THE ISSUE WAS WHETHER RENTAL RECEIPTS OF SIP ARE ELIGIBLE FOR DEDUCTION U/S.801A(4)(III) OF THE ACT. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT(A) ERRED IN HOLDING THAT THE RENTAL INCOME FROM THE BUILDING IS TAXABLE AS BUSINESS INCOME BY REFERRING TO THE SPEC IFICATIONS OF THE STRUCTURE AND AMENITIES WITHOUT APPRECIATING TH AT SUCH 3 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 3 AMENITIES HAVE BEEN PROVIDED BY THE ASSESSEE AS THE BUILDING IS A COMMERCIAL COMPLEX WHICH IS BEING COMMERCIALLY EX PLOITED BY THE TENANT AND NOT BY THE ASSESSEE. 6. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT(A) ERRED IN HOLDING INTEREST ON FIXED DEPOSITS KEPT WITH THE BANK AS BUSINESS RECEIPTS WITHOUT APPRECIATING THAT THE INTEREST RECEIPT ON FIXED DEPOSITS HAVE NO IMMEDIATE NEXUS W ITH THE ASSESSEE'S BUSINESS. 2. AT THE OUTSET OF THE HEARING, THE LD. AUTHORIZE D REPRESENTATIVE OF THE ASSESSEE SUBMITS THAT GROUNDS OF APPEAL RAISED BY THE REVENUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE IN ITS OWN CASE FOR THE ASSESSMENT YEAR 20 06-07 TO 2009-10 IN ITA NO.919,1989,1990,1991/MUM/2013, ORDE R DATED 23/09/2017. ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ARGUED THAT GROUNDS OF THE PRESENT APPEAL ARE NOT COVERED IN VIEW OF THE DECIS ION OF THE HONBLE SUPREME COURT IN CHENNAI PROPERTIES & INVES TMENT PVT. LTD. 373 ITR 673 (SC). IN REJOINDER, ARGUMENT OF TH E LD. AR SUBMITTED THAT THE DECISION OF THE CHENNAI PROPERTI ES & INVESTMENT PVT. LTD. (SUPRA) WAS ALREADY CONSIDERED BY THE COORDINATE BENCH IN PARA 9 OF THE ORDER OF THE TRI BUNAL FOR ASSESSMENT YEAR 2006-07 TO 2009-10. 4 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 4 2.1. WE HAVE CONSIDERED THE SUBMISSIONS OF THE LD. A.R OF THE ASSESSEE AND PERUSED THE ORDER OF CO-ORDINATE B ENCH OF THE TRIBUNAL FOR A.Y. 2006-07 TO 2009-10 IN ITA NOS. 19 89, 1990 & 1991/MUM/2013 DATED 23.09.2015 IN ASSESSEES ITS OW N CASE. THE COORDINATE BENCH OF THE TRIBUNAL HAS PASSED THE FOLLOWING ORDER:- 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE AL SO GONE THROUGH THE RECORDS. WE FIND THAT THE LD. CIT(A) HA S DISCUSSED IN DETAIL THE NATURE OF ACTIVITIES OF THE ASSESSEE AND THEREAFTER HAS EXAMINED THE FACTS OF THE CASE OF THE ASSESSEE IN T HE LIGHT OF THE VARIOUS JUDICIAL DECISIONS OF THE HIGHER AUTHORITIE S AS REPRODUCED ABOVE. HE HAS RIGHTLY OBSERVED THAT IT WAS NOT A SI MPLE CASE OF LETTING OUT OF THE PROPERTY. THE PREMISES IN QUESTI ON WAS SPECIALLY DESIGNED TO BE OPERATED AS A COMMERCIAL COMPLEX WIT H LOT OF AMENITIES AND FACILITIES ATTACHED TO IT, WHICH ACTI VITY WAS A PART OF THE OBJECTS OF THE ASSESSEE COMPANY AS PROVIDED IN THE MEMORANDUM OF ASSOCIATION OF THE COMPANY. THE LD. C IT(A) HAS OBSERVED THAT THE MAIN INTENTION OF THE ASSESSEE IN THIS CASE WAS TO EXPLOIT THE PROPERTY BY WAY OF COMPLEX COMMERCIAL A CTIVITIES. THE ASSESSEE HAD BEEN OFFERING COMPLEX SERVICES BY WAY OF PROVIDING AMENITIES SUCH AS INFRASTRUCTURE FACILITIES, EXCALA TORS, POWER BACK- UP, CENTRAL AIR- CONDITIONING, LIFTS, MAINTENANCE O F THE COMMON AREA AND MAINTENANCE OF A WHOLE LOT OF OTHER FACILI TIES. THE LD. CIT(A) HAS LISTED THE VARIOUS FACILITIES AND AMENIT IES OFFERED BY THE ASSESSEE TO THE OCCUPANTS IN THE RELEVANT PART OF HIS ORDER AS REPRODUCED ABOVE.. THE LD. CIT(A) HAS ALSO OBSERVED THAT THE 5 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 5 AMOUNT TOWARDS MAINTENANCE OF THE PREMISES AND THE FACILITIES WAS PAID IN ADVANCE BY THE ASSESSEE AND IN FACT HAD MAD E CONTRIBUTION TO THE CORPUS OF THE MAINTENANCE OF THE FUND. AFTER ANALYZING THE ENTIRE LEASE AGREEMENT AND THE DETAILS OF THE SERVI CES AND AMENITIES OFFERED BY THE ASSESSEE HE ARRIVED AT A CONCLUSION THAT THE ENTIRE ACTIVITY WAS CARRIED OUT BY THE ASSESSEE IN AN ORGA NIZED MANNER AS BUSINESS VENTURE WITH MANY DAY TO DAY ACTIVITIES BE ING CARRIED OUT BY THE ASSESSEE. THE INTENTION OF THE ASSESSEE WAS TO EXPLOIT THE COMMERCIAL ASSET AND NOT THE PROPERTY ALONE. THE SE RVICES AND AMENITIES PROVIDED BY THE ASSESSEE COMPANY WERE INS EPARABLE. 7. IT HAS BEEN TIME AND AGAIN HELD BY THE VARIOUS J UDICIAL AUTHORITIES THAT MERELY BECAUSE INCOME WAS ATTACHED TO A PROPERTY IT COULD NOT BE A SOLE FACTOR FOR ASSESSING SUCH IN COME AS INCOME FROM HOUSE PROPERTY. IT HAS TO BE SEEN THAT WHETHER IT WAS THE PRIMARY OBJECTIVE OF THE ASSESSEE TO EXPLOIT THE PR OPERTY IN A SIMPLE MANNER OR TO EXPLOIT IT COMMERCIALLY BY WAY OF COMPLEX COMMERCIAL ACTIVITIES TO GENERATE INCOME. THE ASSES SEE IN THIS CASE HAS DEVELOPED THE SHOPPING MALL AND HAS LET OUT THE SAME BY PROVIDING HOST OF SERVICES/FACILITIES/AMENITIES AND THE BASIC INTENTION OF THE ASSESSEE HAS BEEN TO COMMERCIALLY EXPLOIT THE PROPERTY. THEREFORE, THE INCOME DERIVED FROM THE SH OPPING MALL IS LIABLE TO BE ASSESSED AS BUSINESS INCOME. IT IS AN UNDISPUTED FACT THAT IN THE MEMORANDUM OF ASSOCIATION OF COMPANY, S OME OF THE MAIN OBJECTS OF THE COMPANY INTER ALIA ARE TO PURCH ASE, ACQUIRE, TAKE ON LEASE ETC. AN AREA, LAND, BUILDING STRUCTUR E AND TO DEVELOP AND MAINTAIN THE SAME AS MARKETS OR OTHER BUILDINGS , RESIDENTIAL AND COMMERCIAL OR CONVINCES, DRAINAGE FACILITY, ELE CTRIC, TELEPHONIC, TELEVISION INSTALLATIONS AND TO DEAL WI TH THE SAME IN ANY 6 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 6 MANNER WHATSOEVER, TO CONSTRUCT, ERECT, BUILD, LET OUT BUILDING STRUCTURES, HIGH TECH PARKS, HOUSES, APARTMENTS, HO SPITALS ETC. IT IS ALSO MENTIONED IN THE MAIN OBJECTS OF THE COMPANY T O CARRY ON THE BUSINESS OF THE BUILDER TO DEVELOP THE PROPERTIES B Y CONSTRUCTION OF MULTISTORIED COMMERCIAL COMPLEX AND TO GRANT THE SA ME ON LEASE OR LICENSE OR TO SALE OR OTHERWISE DISPOSE OF THE P ROPERTIES SO CONSTRUCTED AND ALSO TO MANAGE AND MAINTAIN THE PRO PERTIES SO CONSTRUCTED. WHEN AS PER THE MEMORANDUM OF ASSOCIAT ION OF THE COMPANY THE MAIN OBJECT OF THE COMPANY WAS TO TO PU RCHASE AND ACQUIRE AND DEVELOP THE PROPERTY AND TO GIVE THE SA ME ON LEASE OR LICENSE BASIS ALONG WITH COMPLEX COMMERCIAL ACTIVIT IES THEN THE COMPANY WAS JUSTIFIED IN DECLARING ITS INCOME FROM SUCH PROPERTY AS BUSINESS INCOME. THE INTENTION OF THE ASSESSEE W AS TO COMMERCIALLY EXPLOIT THE PROPERTY BY WAY OF COMPLEX ACTIVITIES AS PER ITS MAIN OBJECTS. THE OTHERWISE UNDISPUTED FACTS OF THE CASE ARE THAT THE ASSESSEE THE RENTAL INCOME FROM LEASING OF THE PREMISES INCLUDE SUBSTANTIAL INCOME FROM PROVIDING AMENITIES AND FACILITIES. SUC H FACILITIES ARE NOT THE BASIC FACILITIES REQUIRED FOR OCCUPATION OR RENTING OF A BUILDING OR PREMISES, BUT THESE ARE THE SPECIAL FAC ILITIES FOR RUNNING OF THE MULTIPLEX/ SHOPPING MALL ETC. AND ARE MEANT TO ATTRACT THE CUSTOMERS AND PROVIDE COMFORT OF SHOPPING TO THEM. THESE FACILITIES CAN NOT BE SAID TO BE BASIC/NORMAL FACIL ITIES REQUIRED FOR OCCUPATION OF THE PREMISES. NOT ONLY THE COST OF CO MMON FACILITIES HAS BEEN EMBEDDED IN THE LEASE RENTALS BUT ALSO THE SUBSTANTIAL AMOUNT ON ACCOUNT OF PROVIDING AMENITIES/FACILITIES TO THE OCCUPANTS/TENANTS. THE ASSESSEES ACTIVITY THUS CAN NOT BE SAID TO BE MERE LETTING OF THE BUILDING OWNED BY IT BUT ITS ACTIVITY IS A 7 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 7 BUSINESS ACTIVITY OF CONSTRUCTION OF MALL, MAINTAIN ING IT, LEASING THE SHOPS/ AREA FOR THE PURPOSE OF COMMERCIAL EXPLO ITATION OF THE ASSET, ARRANGE AND PROVIDE THE FACILITIES AND AMENI TIES NOT ONLY TO THE OCCUPANTS/LESSEES BUT ALSO TO PROVIDE AND MAINT AIN FACILITIES AND AMENITIES IN THE COMMON AREAS FOR THE ATTRACTIO N, CONVENIENCE AND COMFORT OF THE CUSTOMERS/VISITORS. IN OUR VIEW, AS PER THE MODERN DAY TRENDS OF RETAIL BUSINESS AND CUSTOMER PREFERENCES, NOT ONLY THE QUANTUM OF RENT/ INCOME FROM THE MULTIPLEX BUT ALSO THE VERY LETTING OF THE PREM ISES DEPENDS UPON THE PROVISIONS OF FACILITIES AND AMENITIES PRO VIDED TAKING INTO CONSIDERATION NOT ONLY THE NEED AND REQUIREMENTS OF THE BUSINESS ENTITIES/OCCUPANTS BUT ALSO THE COMFORT ZONE OF THE CUSTOMERS/VISITORS. THE LD. A.R. OF THE ASSESSEE IN THIS RESPECT HAS EXPLAINED THAT THE RENTAL INCOME RECEIVED BY THE AS SESSEE FROM LETTING OUT THE COMMERCIAL COMPLEX ALONG WITH AMENI TIES WAS VERY HIGH IN COMPARISON TO THE ORDINARY LETTING OFF OF A NY BUILDING. HE HAS EXPLAINED THAT FOR AN INVESTMENT OF ABOUT RS.25 CRORES THE ASSESSEE WAS GETTING THE RENTAL INCOME OF RS.2.5 CR ORES WHICH WAS MUCH MORE THAN THE INCOME THAT CAN BE FAILED FROM O RDINARY LETTING OF THE BUILDING. THE ASSESSEE HAD MADE HIGH INVESTMENTS FOR EQUIPMENTS AND INFRASTRUCTURE FOR PROVIDING THE AMENITIES. HE HAS FURTHER EXPLAINED THAT IN THE CASE OF THE SISTE R CONCERN OF THE ASSESSEE M/S. KHANDELWAL ESTATE PVT. LTD., UNDER SI MILAR CIRCUMSTANCES, THE RENTAL INCOME HAS BEEN HELD TO B E AS BUSINESS INCOME BY THE TRIBUNAL VIDE ORDER DATED 07.02.2014 PASSED IN ITA NO.2692/M/2010. HE HAS FURTHER INVITED OUR ATTENTIO N TO THE BALANCE SHEET OF THE ASSESSEE TO SHOW THAT THE ASSE SSEE HAD BORROWED HUGE FUNDS FOR THE CONSTRUCTION AND DEVELO PMENT OF THE 8 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 8 COMMERCIAL COMPLEX WHICH ACTIVITY WAS NOT LIKE THAT OF AN ORDINARY OWNER OF THE PROPERTY WHO LETS OUT THE SAM E FOR EARNING RENTAL INCOME BUT THE SAME WAS AN ORGANIZED, PLANNE D ACTIVITY TO CONSTRUCT THE SHOPPING MALL, PROVIDE THE INFRASTRUC TURE AND RELATED AMENITIES AND TO EXPLOIT THE SAME COMMERCIALLY. IN AN ORDINARY LETTING NO ONE WILL BORROW SUCH A HUGE AMOUNT JUST TO LET OUT THE PROPERTY FOR EARNING RENTAL INCOME WHICH GENERALLY DOES NOT GIVE APPROPRIATE RETURNS AS COMPARED TO THE INVESTMENTS. IN THIS CASE, THE ASSESSEE HAD TAKEN HUGE RISK OF BORROWINGS AND LOSS WHICH WAS TEMPTED BY THE EXPECTATIONS OF HIGH RETURNS AND THE SAME CANNOT BE SAID TO BE ORDINARY LETTING OF THE HOUSE PROPERT Y. THE ACTIVITY OF CONSTRUCTION OF MULTIPLEX ITS MAINTENANCE AND PROVI DING AMENITIES AND FACILITIES THEREIN, THUS CAN NOT BE SAID TO BE MERE LETTING OUT OF THE PROPERTY BUT IN OUR VIEW IS A COMPOSITE BUSINES S ACTIVITY. 8. THE HON'BLE SUPREME COURT IN THE CASE OF KARNANI PROPERTIES LTD. V. CIT [1971] 82 ITR 547 HAS LAID DOWN THE PRE CISE TESTS THAT ARE NECESSARY TO DETERMINE WHETHER THE SERVICES REN DERED BY AN ASSESSEE TO ITS TENANTS/RECIPIENTS OF SERVICE, ARE IN THE NATURE OF BUSINESS ACTIVITIES AND INCOME GENERATED THEREFROM ASSESSABLE AS BUSINESS INCOME, OR NOT. THE HON'BLE SUPREME COURT HAS EXPRESSED THE VIEW THAT IF THE SERVICES RENDERED BY THE ASSES SEE ARE THE RESULTS OF ITS ACTIVITIES CARRIED ON CONTINUOUSLY IN AN ORG ANIZED MANNER, WITH A SET PURPOSE AND WITH A VIEW TO EARN PROFITS, THOSE ACTIVITIES WOULD CONSTITUTE BUSINESS ACTIVITIES AND THE INCOME ARISING THEREFROM WOULD BE ASSESSABLE AS BUSINESS INCOME UN DER SECTION 28 OF THE ACT. THE ACTIVITIES OF THE ASSESSEE IN TH IS CASE IN PROVIDING THE VARIOUS SERVICES/FACILITIES/AMENITIES MEET ALL THE 9 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 9 AFORESAID FOUR REQUIREMENTS LAID DOWN BY HON'BLE SU PREME COURT TO QUALIFY AS BUSINESS ACTIVITIES. 9. IN A VERY RECENT JUDGMENT, THE HON'BLE SUPREME C OURT IN THE CASE OF CHENNAI PROPERTIES & INVESTMENT LTD. [201 5] 373 ITR 673(SC) HAS NOTED THAT IN ITS (SUPREME COURT) EARLIER JUDGMENT IN THE CASE OF KARANPURA DEVELOPMENT CO. LTD. VS. CIT 44 ITR 36 2 (SC), THE POSITION OF LAW ON THIS ISSUE HAS BEEN SUMMED UP IN THE FOLLOWING WORDS:- 'AS HAS BEEN ALREADY POINTED OUT IN CONNECTION WITH THE OTHER TWO CASES WHERE THERE IS A LETTING OUT OF PREMISES AND COLLECTION OF RENTS THE ASSESSMENT ON PROPERTY BASIS MAY BE CORRE CT BUT NOT SO, WHERE THE LETTING OR SUB-LETTING IS PART OF A TRADI NG OPERATION. THE DIVING LINE IS DIFFICULT TO FIND; BUT IN THE CASE O F A COMPANY WITH ITS PROFESSED OBJECTS AND THE MANNER OF ITS ACTIVITIES AND THE NATURE OF ITS DEALINGS WITH ITS PROPERTY, IT IS POSSIBLE TO S AY ON WHICH SIDE THE OPERATIONS FALL AND TO WHAT HEAD THE INCOME IS TO B E ASSIGNED.' THE HON'BLE SUPREME COURT THUS HAS EMPHASIZED THE P ROFESSED OBJECTS AND THE MANNER OF ACTIVITIES CARRIED OUT BY AN ASSESSEE. IT HAS ALSO BEEN POINTED OUT THAT THE NATURE OF DEALIN GS WITH THE PROPERTY WOULD ALSO BE FACTOR TO DETERMINE WHETHER THE ACTIVITIES FALL FOR CONSIDERATION UNDER THE HEAD `'BUSINESS IN COME'' OR 'HOUSE PROPERTY INCOME'. THE HONBLE SUPREME COURT THUS NO TICED THE AFORESAID PRINCIPLE AND APPLIED THE SAME TO THE FAC TS OF THE CASE BEFORE IT. THE FACTS OF THE CASE BEFORE THE HONBLE SUPREME COURT WERE THAT AS PER THE MEMORANDUM OF ASSOCIATION, THE MAIN OBJECTS 10 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 10 OF THE APPELLANT COMPANY WAS TO ACQUIRE AND HOLD TH E PROPERTIES KNOWN AS CHENNAI HOUSE AND FIRHAVIN ESTATE BOTH IN CHENNAI AND TO LET OUT THOSE PROPERTIES AS WELL AS MAKE ADV ANCES UPON THE SECURITY OF LANDS AND BUILDINGS OR OTHER PROPERTIES OR ANY INTEREST THEREIN. IN THE RETURN THAT WAS FILED, THE ENTIRE I NCOME WHICH ACCRUED AND WAS ASSESSED IN THE SAID RETURN WAS FRO M LETTING OUT OF THOSE PROPERTIES. THE HONBLE SUPREME COURT WHILE R ELYING UPON ITS THE VARIOUS OTHER DECISIONS HELD THAT IN SUCH A CASE THE IRRESISTIBLE CONCLUSION WOULD BE THAT THE LETTING O F THE PROPERTIES WAS IN FACT THE BUSINESS OF THE ASSESSEE AND THE IN COME ARISING THEREFROM WAS TO BE TREATED UNDER THE HEAD INCOME FROM BUSINESS AND THAT IT CANNOT BE TREATED AS INCOME F ROM HOUSE PROPERTY. WHAT THE HONBLE SUPREME COURT EMPHASIZED UPON WAS THAT THE HOLDING THE AFORESAID PROPERTIES AND EARNI NG INCOME BY LETTING OUT THOSE PROPERTIES WAS THE MAIN OBJECTIVE OF THE COMPANY. THE FACTS OF THE CASE OF THE ASSESSEE BEFO RE US ARE ON BETTER FOOTINGS. THE ASSESSEES OBJECTS ARE NOT IN RESPECT OF LETTIN G OF ANY PARTICULAR PROPERTY, BUT IT HAS THE MAIN OBJECTS OF ACQUIRING, CONSTRUCTING, OPERATING AND MAINTAINING OF THE MULTIPLEXES, BUSIN ESS CENTER, I.T. PARKS, SOFTWARE ZONES, COMMERCIAL & RESIDENTIAL COM PLEXES AND TO GRANT THE SAME ON LEASE/LICENSE ALSO. THE VERY OBJE CT IS THE COMMERCIALLY EXPLOITATION OF THE PROPERTIES. BESIDE S THAT THE ASSESSEE IS ALSO PROVIDING HOSTS OF AMENITIES AND F ACILITIES, AS DISCUSSED ABOVE, WHICH AMOUNTS TO COMPOSITE BUSINES S ACTIVITY. THUS THE ISSUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE ABOVE NOTED DECISIONS OF THE HONBLE SUPREME COURT. 11 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 11 WE THEREFORE HOLD THAT THE INCOME/LOSS FROM THE MUL TIPLEX IS LIABLE TO BE ASSESSED AS BUSINESS INCOME/LOSS AND NOT AS INCOME FROM HOUSE PROPERTY. THE ASSESSEE CONSEQUENTLY IS ALSO E NTITLED TO THE CLAIM OF DEDUCTIONS IN RESPECT OF EXPENDITURE INCUR RED AND DEPRECIATION ON ASSETS ETC. IN RELATION TO SUCH INC OME. HENCE, WE DO NOT FIND ANY REASON TO DEVIATE FROM THE FINDINGS RECORDED BY THE LD. CIT(A) ON THIS ISSUE. 2.2. CONSIDERING THE DECISION OF THE COORDINATE BE NCH OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEARS 2006- 07 TO 2009-10, ORDER DATED 23/09/2015, WE FIND THAT THE ISSUE RAISED BY THE REVENUE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE. THE OBJECTION RAISED BY LD DR HAS ALREADY BEEN DEALT WITH BY THE COORDINATE BENCH OF THE TRIBUNAL. HENC E, RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL, GROUNDS RAISED BY THE REVENUE, IS DISMISSED. FINALLY, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 .11.2017 SD/- SD/- R.C. SHARMA PAWAN SINGH ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 13 .11.2017 F{X~{T? C|TX FXVXT 12 ITA NO.1316/MUM/2015 M.S. LUVISH PROJECTS PVT. LTD. 12 COPY OF THE ORDER FORWARDED TO : 1. THE ASSESSEE; 2. THE REVENUE; 3. THE CIT(A); 4. THE CIT, MUMBAI CITY CONCERNED; 5. THE DR, ITAT, MUMBAI; 6. GUARD FILE. BY ORDER (DY./ASSTT.REGISTRAR) ITAT, MUMBAI