ACIT 32(1), MUMBAI V. ASHAPURA DEVELOPERS, MUMBAI

ITA 1466/MUM/2017

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 2951 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 02-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANANDI VERMA
• Assessee Lawyers: DR K SHIVARAM
• Keywords: Business income

Judgement Text

IN THE INC OME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI BEFORE HONBLE SHRI SANDEEP GOSAIN, JM & HONBLE SHRI G. MANJUNATHA, AM ./ I.T.A. NO . 1466 / MUM/201 7 ( / ASSESSMENT YEAR: 2012 - 13 ) ACIT 32 (1) PRATYAKSHKAR BHAVAN, R. NO. 209, 2 ND FLOOR, BKC, BANDRA, MUMBAI - 400 051 . / VS. ASHAPURA DEVELOPERS 6 OM SAI WELFARE SOCIETY, SAVARPADA JUNCTION, OPP - SHRI KRISHNA AVENUE, BORIVALI EAST, MUMBAI - 400 066 ./ ./ PAN/GIR NO. AA NFA1971F & ./ I.T.A. NO. 3565/MUM/2016 ( / ASSESSMENT YEAR: 20 11 - 12 ) ASHAPURA DEVELOPERS 6 OM SAI WELFARE SOCIETY, SAVARPADA JUNCTION, OPP - SHRI KRISHNA AVENUE, BORIVALI EAST, MUMBAI - 400 066 / VS. JCIT 25(1) PRATYAKSHKAR BHAVAN, BKC, BANDRA, MUMBAI - 400 051. / APPELLANT BY : SH. ANANDI VERMA (DR) / RESPONDENTBY : DR. K. SHIVARAM & SH. SASHANK DUNDU (AR S ) / DATE OF HEARING : 16/01 /201 9 / DATE OF PRONOUNCEMENT : 01.03.2019 2 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS / O R D E R PER SHRI SANDEEP GOSAIN, JUDICIAL MEMBER : THE SE TWO A PPE AL S FILED BY THE REVENUE AS WELL AS ASSESSEE ARE AGAINST THE ORDER OF LD. CIT(A) 44, DATED 14.12.16 & 17.03.16 FOR AY 2012 - 13 & 2011 - 12 RESPECTIVELY. 2. SINCE ALL THE ISSUES INVOLVED IN THESE TWO APPEALS ARE COMMON, THEREFORE, THEY HAVE BEEN CLUBBED , HEARD TOGETHER AND A CONSOLIDATED ORDER IS BEING PASSED FOR THE SAKE OF CONVENIENCE AND BREVITY. ITA NO. 1466/MUM/2017 (AY 20 12 - 13 ) 3. FIRST OF ALL WE TAKE UP REVENUE S APPEAL IN ITA NO. 1466/MUM/2017 FOR ASSESSMENT YEAR 2012 - 13 AS LEAD CASE . THE GROUND OF APPEAL ARE MENTIONED HEREIN BELOW: - 1. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE LD.CIT(A), ERRED IN ALLOWING THE CLAIM OF ASSESSEE TO TREAT RENTAL INCOME OF RS.34,13,95,611/ - AS INCOME FROM HOUSE PROPERTY INSTEAD OF BUSINESS INCOME AS ASSESSED BY THE AO, WITHOUT APPRECIATING 3 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS TH E FACT THAT RENTAL INCOME WAS RE CEIVED FROM THE BUSINESS ASSET OF UNSOLD FLATS SHOWN AS STOC K - IN - TRADE. THE LD. CIT(A) ALSO FAILED TO APPRECIATE THE FACT THAT THE ASSESSEE HAS INCLUDED RENTAL INCOME IN ARRIVING AT ITS GROSS SALES APPEARING IN ITS BUILDING AND CONSTRUCTION ACCOUNT AND THEREBY ARRIVING AT THE GROSS PROFIT WHICH IN TURN TAKEN TO THE PROFIT & LOSS ACCOU NT TO ARRIVE AT NET PROFIT.' 2. 'ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) FAILED TO APP RECIATE THE DECISION OF HONBLE APEX COURT DATED 9 TH APRIL 2015 IN THE CASE OF CHENNAI PROPERTIES AND INVESTMENTS LTD. VS. CIT, CENTR AL - ILL, TAMIL NADU (2015) REPORTED IN 373 ITR 673, AS REITERATED IN THE CASE OF M/S. RAYALA CORPORATION PVT. LTD. VS. ACIT (CIVIL APPEAL NO.6473 OF 2016 DATED 11.08.20146) HAS HELD THAT 'IF AN ASSESSEE IS HAVING HIS HOUSE PROPERTY AND BY WAY OF BUSINESS HE IS GIVING THE PROPERTY ON RENT AND IF HE IS RECEIVING RENT FROM THE SAID PROPERTY AS HIS BUSINESS INCOME, THE SAID INCOME, EVEN IF IN THE NATURE OF RENT, SHOULD BE TREATED AS BUSINESS INCOME.' 3. 'THE APPELLANT PRAYS THAT THE ORDER OF THE ID.CIT(A) ON T HE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 4 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS 4. 'THE APPELLANT CRAVES LEAVES TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND.' 4 . AS PER THE FACTS OF THE PRESENT CASE ARE THAT THE ASSESSEE FILED ITS RETURN OF INCOME ON 30. 09.2012 SHOWING TOTAL INCOME OF RS.29,62,86,490 / - . THE ASSESSEE IS A FIRM ENGAGED IN THE BUSINE SS OF BUILDERS & DEVELOPERS. THE ONLY ISSUE IN BOTH APPEAL IS REGARDING THE TREATMENT OF INCOME FROM RENTING OF IMMOVABLE PROPERTIES AS INCOME FROM BUSINES S. THE ASSESSEE FIRM HAD SHOWN RENTAL INCOME OF RS 34,13,95,6117 - . THE ASSESSEE CATEGORIZED THIS INCOME AS FALLING UNDER THE HEAD OF INCOME FROM HOUSE PROPERTY . THE ASSESSEE ALSO CLAIMED 30% DEDUCTION U/S 23 AGAINST SUCH RENTAL INCOME. O N THE OTHER H AND, THE AO STATED THAT THE MERE FACT THAT INCOME IS ATTACHED TO IMMOVABLE PROPERTY CANNOT BE THE SOLE CRITERION FOR TAKING IT AS INCOME. THE AO THEREFORE TREATED THE RENTAL INCOME AS INCOME FROM BUSINESS AND ALLOWED THE DEDUCTION OF ONLY THE PROPERTY TAX PAID. AGGRIEVED BY THE ORDER OF AO, ASSESSEE PREFERRED APPEAL BEFORE LD. CIT(A) AND LD. CIT(A) AFTER CONSIDERING THE CASE OF 5 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS BOTH THE PARTIES, ALLOWED FOR STATISTICAL PURPOSES THE APPEAL OF THE ASSESSEE BY HOLDING THAT RENTAL INCOME EARNED BY THE ASSESSEE BE TREATED UNDER THE HEAD HOUSE PROPERTY IN AY 2012 - 13. NOW BEFORE US, THE REVENUE AS WELL AS ASSESSEE HAVE PREFERRED THEIR RESPECTIVE APPEALS. FIRSTLY WE ARE DEALING WITH T HE APPEAL FILED BY THE REVENUE FOR AY 2012 - 13. GROUND NO. 1 & 2 5. THESE GROUNDS RAISED BY THE REVENUE ARE INTER CONNECTED AND INTER RELATED AND RELATES TO CHALLENGING THE ORDER OF LD. CIT(A) IN ALLOWING THE CLAIM OF THE ASSESSEE TO TREAT RENTAL INCOME AS INCOME FROM HOUSE PROPERTY INSTEAD OF BUSINESS INCOME AS ASSESSED BY THE AO, THEREFORE WE THOUGHT IT FIT TO DISPOSE OF THE SAME BY THIS COMMON ORDER. 6. LD. DR APPEARING ON BEHALF OF THE DEPARTMENT RELIED UPON TH E ORDERS PASSED BY AO AND SUBMITTED THAT LD. CIT(A) HAD ERRED IN ALLOWING THE CLAIM OF ASSESSEE TO TREAT RENTAL INCOME OF RS.34,13,95,611/ - AS INCOME FROM HOUSE PROPERTY INSTEAD OF 6 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS BUSINESS INCOME AS ASSESSED BY THE AO, WITHOUT APPRECIATING THE FACT THAT RENTAL INCOME WAS RECEIVED FROM THE BUSINESS ASSET OF UNSOLD FLATS SHOWN AS STOCK - IN - TRADE. IT WAS SUBMITTED THAT THE LD. CIT(A) ALSO FAILED TO APPRECIATE THE FACT THAT THE ASSESSEE HAD INCLUDED RE NTAL INCOME IN ARRIVING AT ITS GROSS SALES APPEARING IN ITS BUILDING AND CONSTRUCTION ACCOUNT AND THEREBY ARRIVING AT THE GROSS PROFIT WHICH IN TURN TAKEN TO THE PROFIT & LOSS ACCOUNT TO ARRIVE AT NET PROFIT. LD. DR FURTHER SUBMITTED THAT LD.CIT(A) HAD FA ILED TO APPRECIATE THE DECISION OF HONBLE APEX COURT DATED 9 TH APRIL 2015 IN THE CASE OF CHENNAI PROPERTIES AND INVESTMENTS LTD. VS. CIT, CENTRAL - III, TAMIL NADU (2015) REPORTED IN 373 ITR 673 , AS REITERATED IN THE CASE OF M/S. RAYALA CORPORATION PVT. LTD . VS. ACIT (CIVIL APPEAL NO.6473 OF 2016 DATED 11.08.2014) , WHEREIN IT WAS H ELD THAT ' IF AN ASSESSEE IS HAVING HIS HOUSE PROPERTY AND BY WAY OF BUSINESS HE IS GIVING THE PROPERTY ON RENT AND IF HE IS RECEIVING RENT FROM THE SAID PROPERTY AS HIS BUSINESS IN COME, THE SAID INCOME, EVEN IF IN THE NATURE OF RENT, SHOULD BE TREATED AS BUSINESS INCOME . 7 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS 7. ON THE OTHER HAND, LD. AR RELIED UPON THE ORDERS PASSED BY THE LD. CIT(A) AND REITERATED THE SAME ARGUMENTS AS WERE R AISED BY HIM BEFORE LD. CIT(A) AND ALSO REFERRED TO THE DECISION OF THE COORDINATE BENCH OF ITAT IN ITA NO. 7119/MUM/13 FOR AY 2010 - 11 IN ASSESSEES OWN CASE, CIT VRS. GUNDECHA BUILDERS IN ITA NO. 347 OF 2016 & 4475/MUM/2011 FOR AY 2008 - 09, CIT VRS. SANE & DOSHI ENTERPRISES (2015) 377 ITR 165 (BOM - HC), EAST INDIA HOUSING AND LAND DEVELOPMENT TRUST LTD. VRS. ACIT (1962) 42 ITR 49 (SC) AND PR. CIT VRS. QUEST INVESTMENT ADVISORS PVT. LTD. (2018) 257 TAXMAN 211 (BOM - HC) . 8 . WE HAVE HEARD COUNSELS FOR BOTH THE PARTIES AND WE HAVE ALSO PERUSED THE MATERIAL PLACED ON RECORD , JUDGMENT CITED BY THE PARTIES AS WELL AS THE ORDERS PASSED BY REVENUE AUTHORITIES. BEFORE WE DECIDE THE MERITS OF THE CASE, IT IS NECESSARY TO EVALUATE THE ORDERS PASSED BY LD. CIT( A). THE LD. CIT(A) HAS 8 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS DEALT WITH THE ABOVE GROUND RAISED BY THE ASSESSEE IN PARA NO. 3.3 & 3.4 OF ITS ORDER AND THE SAME IS REPRODUCED BELOW: - 3.3 I HAVE CAREFULLY GONE THROUGH THE ASSESSMENT ORDER AS WELL AS THE WRITTEN SUBMISSION OF THE AR. I HAVE ALSO PERUSED THE DETAILS FILED BY THE AR. I HAVE ALSO CAREFULLY STUDIED THE ORDER OF THE HON'BLE ITAT A BENCH MUMBAI IN APPELLANT'S OWN CASE FOR THE AY 2010 - 11. IN ITS ORDER THE HON'BLE ITAT A BENCH, MUMBAI MADE INTER ALIA THE FOLLOWING COMMENTS. 'SINCE THE AO WAS OF THE VIEW THAT THE ASSESSEE WAS COMMERCIALLY EXPLOITING HIS SHOPS CUM OFFICE COMPLEX, THEREFORE THE INCOME OF THE ASSESSEE IS LIABLE TO BE TREATED AS BUSINESS INCOME. HENCE THE AO DECLINED THE CONTENTION OF THE ASSESSEE AND TREATED THE INCOME FROM BU SINESS INCOME DESPITE INCOME FROM H OUSE PROPERTY. UNDOUBTEDLY THE L D CIT(A) HAS CONFIRMED THE SAME. THE L D . REPRESENTATIVE OF THE ASSESSEE HAS RELIED UPON THE LAW SETTLED BY THE HON 'BLE BOMBAY HIGH COURT IN CASE OF CO MMISSIONER OF INCOME TAX 12 VS M /S SANE & DOSHI ENTERPRISES DECIDED ON 9 APRIL, 2015. NOW IT IS TO BE SEEN WHETHER THE FACTS OF THE CASE IS IDENTICAL TO THE FACTS OF THIS CASE OR NOT. THE SAID ORDER PERUSED WHICH SPEAKS THAT TH E 9 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS ASSESSEE WAS ENGAGED IN THE REAL ESTATE BUSINESS AND CONSTRUCTED A COMPLED VIZ. MAY FAIR TOWER. IT IS STATED TO BE A PARTNERSHIP FIRM REGISTER UNDER THE INDIAN PARTNERSHIP ACT, 1932. HE HAS ALSO SHOWN THE RENTAL INCOME , BUT THE AUTHORITY TREATED THE SAME AS INCOME FROM BUSINESS. THEREFORE, THE MATTER WENT UP TO THE JURISDICTIONAL HIGH COURT AND THE HON'BLE HIGH COURT IN THE CASE CITED ABOVE DECIDED THE MATTER IN FAVOUR OF THE ASSESSEE. THE FACTS AND CIRCUMSTANCES OF THIS CASE IS QUITE SIMILAR TO THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE. IN BOTH THE CASE THE ASSESSEE HAVE CONSTRUCTED COMMERCIAL COMPLEX AND RENTED OUT THE UNSOLD SHOPS/ OFFICES ON LEASE. IN CASE OF THE HONBLE BOMBAY HIGH COURT, COMMISSIONER OF INCOME TAX 12 VS M/S SANE & DOSHI ENTERPRISES DECIDED ON 9 APR IL, 2015 THE INCOME OF THE ASSESSEE WAS TREATED AS INCOME FROM HOUSE PROPERTY. FINDING IDENTICAL FACTS AND CIRCUMSTANCES OF THE PRESENT CASE, WE ARE OF THE VIEW THAT IN THE PRESENT CASE THE LAW IS QUITE APPLICABLE AND THE INCOME OF THE ASSESSEE IS LIABLE T O BE TREATED AS INCOME FROM THE HOUSE PROPERTY AND ACCORDINGLY HE WOULD BE ENTITLED EXEMPTION U/S 22 OF THE ACT. HENCE IN VIEW OF THE ABOVE SAID LAW WE SET ASIDE THE FINDING OF THE CIT(A) IN 10 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS QUESTION AND DIRECT THE AO TO RE - ASSESS THE INCOME OF THE ASSESSE E IN VIEW OF THE OBSERVATION MADE ABOVE. ' 3.4 SINCE, ON SIMILAR FACTS THE HIGHEST FACT FINDING AUTHORITY I.E. THE ITAT HAS ALREADY DECIDED THAT THE RENTAL INCOME SHOWN BY THE APPELLANT IS LIABLE TO BE TREATED AS INCOME FROM HOUSE PROPERTY, FOLLOWING THE JUDGMENT OF THE HON'BLE ITAT THE GROUNDS OF APPEAL NO. 1 (1.1 TO 1.7) IS ALLOWED. THE AO IS ACCORDINGLY DIRECTED TO TREAT THE RENTAL INCOME OF RS 34,13,95,611/ - AS INCOME UNDER THE HEAD HOUSE PROPERTY. 9 . AFTER HEARING THE PARTIES AT LENGTH AND AFTER HAVING GONE THROUGH THE ORDERS PASSED BY REVENUE AUTHORIT IES AND CONSIDERING THE FACTS OF THE PRESENT CASE, WE FIND THAT THE ASSESSEE IS IN THE BUSINESS AND DEVELOPERS AND DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE EARNED INCOME FROM UNITS LEASED OU T TO CERTAIN PARTIES AND SUCH LEASING IS DONE FOR LONG TENURES. THE ASSESSEE HAD CLAIMED THE LEASE RENTAL INCOME TO BE INCOME FROM HOUSE PROPERTY, BUT THE SAME WAS REJECTED BY THE AO AND THE COORDINATE BENCH OF ITAT IN ASSESSEES OWN CASE IN ITA NO. 11 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS 7119/M UM/13 FOR AY 2010 - 11 HAD PASSED ORDERS IN FAVOUR OF ASSESSEE, WHEREIN IT WAS HELD THAT THE LEASE RENTAL INCOME BE ASSESSED UNDER INCOME FROM HOUSE PROPERTY. WHEREAS ON THE CONTRARY, THE AO REJECTED THE CLAIM OF THE ASSESSEE BY HOLDING THAT THE INTENTION OF THE ASSESSEE IS TO EXPLOIT THE IMMOVABLE PROPERTY BY WAY OF COMMERCIAL ACTIVITY. IN THIS REGARD, WE NOTICED THAT THE UNITS PROVIDED ON TENANCY HAD BEEN MADE FOR A TENURE RANGING BETWEEN 3 TO 9 YEARS, WHICH SHOWS THAT THE INTENTION OF THE ASSESSEE WAS TO E ARN LEASE RENTAL INCOME AND NOT TO EXPLOIT THE IMMOVABLE PROPERTY. 10. THE LD. DR HAD PLACED HAVING RELIANCE ON THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF CHENNAI PROPERTY (SUPRA), WHEREIN THE HONBLE SUPREME COURT HAD HELD THAT SINCE LETTING OF THE PROPERTY WAS THE BUSINESS OF THE ASSESSEE AND THUS THE INCOME OF RE NTAL WOULD BE TREATED AS INCOME UNDER THE HEAD BUSINESS AND NOT AS INCOME FROM HOUSE PROPERTY. WHILE RELYING UPON THE ABOVE JUDGMENT, IT WAS SUBMITTED BY LD. DR THAT IN THE PRESENT CASE ALSO, THE ASSESSEE IS CARRYING OUT BUSINESS AND USING 12 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS IMMOVABLE PROPERTY BY WAY OF LETTING OUT SPACE AND EARNING RENTAL INCOME THROUGH IT AND THUS THE MAIN INTENTION OF THE ASSESSEE IS TO EXPLOIT THE IMMOVABLE PROPERTY BY WAY OF COMMERCIAL ACTIVITY. IT WAS FURTHER ARGUED THAT SINCE THE PREMISES ARE HELD AS STOCK - IN - TRA DE, THEREFORE THE PREMISES ARE BEING BOTH SOLD AND ARE BEING LEASED OUT ON RENT. THUS, THE INCOME BE TREATED AS BUSINESS INCOME OF THE ASSESSEE. 11. IN ORDER TO REBUT THE CONTENTIONS OF THE REVENUE, IT WAS ARGUED BY LD. AR THAT IN THE FINAL COMPUTATION OF INCOME, THE ASSESSEE HAD TREATED THE RENTAL INCOME AS INCOME FROM HOUSE PROPERTY AND THUS CLAIMED STIPULATED 30% DEDUCTION. IT WAS FURTHER SUBMITTED THAT LONG LEASE GIVEN BY THE ASSESSEE INDICATES THE INTENTION OF THE ASSESSEE IS TO PERMANENTLY LETTIN G OUT THE PROPERT, WHICH IS NOT THE BUSINESS OF THE ASSESSEE RATHER THE ASSESSEE IS INTO THE BUSINESS OF DEVELOPMENT OF THE PROPERTY. IT WAS ALSO SUBMITTED THAT AO HAD MADE ADDITIONS WITHOUT FINDING ANY FAULT OR OMISSION IN THE AUDITED FINANCIAL STATEMENT PREPARED ON THE BASIS OF GOVERNING ACCOUNTING STANDARDS AND THE 13 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS PRESENTATION OF SUCH FINANCIAL STATEMENTS. IT WAS ALSO SUBMITTED THAT AO HAD NOT MADE VERIFICATION WITH REGARD TO PERIOD OF LEASE WHICH IS STIPULATED IN THE REGISTER LEAVE AND LICENSE AGREEMEN TS AND THUS HAD NOT CONSIDERED THE INTENTION OF THE ASSESSEE, WHICH IS IMPORTANT CRIETERIA FOR DECIDING THE TAXABILITY OF A PARTICULAR INCOME UNDER A SIGNIFICANT HEAD OF INCOME FROM AMONG THE FIVE HEADS OF INCOME PRESCRIBED UNDER THE INCOME TAX ACT. 12. FROM THE ARGUMENTS OF THE PARTIES AS WELL AS FROM THE RECORDS, WE FOUND THAT THE FACTS IN THE PRESENT CASE ARE NOT IN DISPUTE, BUT THE THRUST OF THE REVENUE TO TREAT THE INCOME OF RENTAL AS BUSINESS INCOME IS MAINLY ON THE BASIS OF JUDGMENT OF HONBLE SU PREME COURT IN THE CASE OF CHENNAI PROPERTIES AND INVESTMENT LTD VRS. CIT (2015) 373 ITR 673 (SC) AND OTHER JUDGMENTS CITED BY LD. DR AS MENTIONED ABOVE. 13. ON SCRUTINY OF THE JUDGMENTS CITED BY BOTH THE PARTIES, WE FOUND THAT IN THE CASE OF CHENNAI PRO PERTIES AND INVESTMENT LTD VRS. CIT ( SUPRA ) , THE MAIN OBJECT AS PER THE MEMORANDUM 14 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS OF ASSOCIATION OF THE ASSESSEE IN THAT CASE WAS TO ACQUIRE THE PROPERTIES IN THE CITY AND TO LET OUT THOSE PROPERTIES. IN THE RETURN, THE ENTIRE INCOME OF THE ASSESSEE WAS FROM LETTING OUT THESE PROPERTIES, THUS IT WAS CONCLUDED THAT THE LETTING OUT THE PROPERTY IS IN FACT IS THE BUSINESS OF THE ASSESSEE AND IN THOSE CIRCUMSTANCES, THE RENTAL INCOME WAS TREATED AS INCOME FROM BUSINESS. WHEREAS AS PER TH E FACTS OF THE PRESENT CASE, THE ASSESSEE IS INTO THE BUSINESS OF BUILDERS AND DEVELOPERS AND NOT EXCLUSIVELY IN THE BUSINESS OF LETTING PROPERTIES. THEREFORE, IN SUCH CIRCUMSTANCES, THE FACTS OF THE PRESENT CASE ARE DISTINGUISHABLE FROM THE FACTS OF THE CASE OF CHENNAI PROPERT IES ( SUPRA ) . THE IDENTICAL PROPOSITION WAS ALSO DISCUSSED BY THE HONBLE JURISDICTIONAL BOMBAY HIGH COURT IN THE CASE OF GUNDECHA BUILDERS, WHERE THE FACTS OF THE CASE ARE SIMILAR TO THAT OF THE ASSESSEES, AFTER CONSIDERING THE JUDG MENT OF CHENNAI PROPERTIES AND INVESTMENT LTD VRS. CIT (2015) 373 ITR 673 (SC) AS WELL AS SANE & DOSHI ENTERPRISES (2015) 377 ITR 165 (BOM HC) HAD HELD THAT THE RENTAL INCOME FROM PROPERTIES HELD IN STOCK - IN - TRADE SHOULD BE ASSESSED UNDER THE HEAD INCOME 15 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS FROM HOUSE PROPERTY, WHEN THE INTENTION OF THE ASSESSEE IS TO EARN RENTAL INCOME. 14. IN THE CASE OF RAJ DADARKAR & ASSOCIATES VRS. ACIT (2017) 81 TAXMANN.COM 193 (SC), WHEREIN IT WAS HELD WHERE ASSESSEE HAVING OBTAINED A PROPERTY ON LEASE, CONSTRUCTED VARIOUS SHOPS AND STALLS ON IT AND GAVE SAME TO VARIOUS PERSONS ON SUB - LICENCING BASIS, SINCE ASSESSEE WAS NOT ENGAGED IN SYSTEMATIC OR ORGANIZED ACTIVITY OF PROVIDING SERVICES TO OCCUPIERS OF SHOPS/STALLS, INCOME FROM SUB - LICENSING WAS TO BE TAXED AS INCO ME FROM HOUSE PROPERTY AND NOT AS BUSINESS INCOME. 15. THEREFORE, CONSIDERING THE VARIOUS JUDGMENTS CITED BY THE RESPECTIVE PARTIES, KEEPING IN VIEW THE ORDERS BY THE COORDINATE BENCH OF ITAT IN ASSESSEES OWN CASE FOR AY 2010 - 11 AND ALSO THE FACTS OF THE PRESENT CASE THAT ASSESSEE IS IN THE BUSINESS OF DEVELOPMENT OF REAL ESTATE PROJECTS AND LETTING OF PROPERTY IS NOT THE EXCLUSIVE BUSINESS OF THE ASSESSEE, THEREFORE WHILE RELYING UPON THE JUDGMENT OF JURISDICTIONAL HIGH COURT IN THE CASE OF 16 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS CIT VRS. GUND ECHA BUILDERS IN ITA NO. 347 OF 2016 DATED 31.07.18 (BOM), WE ARE OF THE VIEW THAT THE RENTAL INCOME EARNED BY THE ASSESSEE WAS RIGHTLY TREATED AS INCOME UNDER THE HEAD HOUSE PROPERTY BY LD. CIT(A). 16 . MOREOVER N O NEW FACTS HAVE BEEN BROUGHT ON RECORD BEFORE US I N ORDER TO CONTROVERT OR REBUT THE FINDINGS SO RECORDED BY LD. CIT(A). THEREFORE, THERE ARE NO REASON S FOR US TO INTERFERE INTO OR DEVIATE FROM THE FINDINGS SO RECORDED BY THE LD.CIT(A). HENCE , WE ARE OF THE CONSIDERED VIEW THAT THE FINDINGS SO RECORDED BY THE LD. CIT (A) ARE JUDICIOUS AND ARE WE LL REASONED. RESULTANTLY, THESE GROUND RAISED BY THE REVENUE STANDS DISMISSED . GROUND NO. 3 & 4 1 7 . THESE GROUNDS RAISED BY THE REVENUE ARE GENERAL IN NATURE, THUS REQUIRES NO SPECIFIC ADJUDICATION. 18 . CONSEQUENTLY, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED. 17 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS ITA NO. 3565/MUM/2016 (AY 2011 - 12 ) 1 9 . NOW WE TAKE UP ASSESSEE S APPEAL IN ITA NO. 3565/MUM/2016 FOR AY 2011 - 12 . SINCE WE HAVE ALR EADY UPHELD THE ORDER OF LD. CIT(A) IN APPEAL FILED BY THE REVENUE IN ITA NO. 1466/MUM/2017 FOR AY 2012 - 13 ON MERITS AND TREATED THE RENTAL INCOME EARNED BY THE ASSESSEE AS INCOME UNDER THE HEAD HOUSE PROPERTY. THEREFORE , FOLLOWING OUR OWN DECISION IN ITA NO. 1466 /M UM /17 , WE APPLY THE SAME FINDINGS IN THE PRESE NT APPEAL IN ORDER TO MAINTAIN JUDICIAL CONSISTENCY WHICH IS APPLICABLE MUTATIS MUT ANDIS IN THE APPEAL FILED BY THE ASSESSEE . 20 . IN THE NET RESULT, THE APPEAL FILED BY THE REVENUE STANDS DISMISSED AND THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED WITH NO ORDER AS TO COST. ORDER PRONOUNCED IN THE OPEN COURT ON 1 ST MARCH , 2019 . SD/ - SD/ - (G. MANJUNATHA ) (SANDEEP GOSAIN) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED : 01 / 0 3 / 201 9 SR.PS . DHANANJAY 18 ITA NO. 1466 /MUM/2017 & ITA NO. 3565/MUM/2016 ASHAPURA DEVELOPERS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. ( ) / THE CIT(A) 4. / CIT - CONCERNED 5. , , / DR, ITAT, MUMBAI 6. / GUARD F I LE / BY ORDER, . / (DY./ASSTT.REGISTRAR) , / ITAT, MUMBAI