Keyaram Hotels Private Limited, CHENNAI V. DCIT, CHENNAI

ITA 274/CHNY/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 77318 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-06-2014
• Appeal Filed By: Assessee
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 05-02-2014
• Court: TRIBUNAL
• Department Lawyers: T N BETGERI
• Assessee Lawyers: S VENUGOPALAN

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHE NNAI . . . , ! , ' # $ BEFORE DR. O.K. NARAYANAN, VICE PRESIDENT & SHRI VIKAS AWASTHY, JUDICIAL MEMBER I.T.A. NOS. 272, 273, 274 & 275/MDS/2014 ASSESSMENT YEARS : 2004-05, 2005-06, 2007-08 & 2008 -09 KEYARAM HOTELS PRIVATE LIMITED, NO.2, HARRINGTON ROAD, CHENNAI -31 [PAN: AABCK 8077 D] ( !% /APPELLANT) VS DEPUTY COMMISSIONER OF INCOME TAX, COMPANY CIRCLE-II(4), CHENNAI ( &'!% /RESPONDENT) / APPELLANT BY : SHRI S.VENUGOPALAN, C.A., / RESPONDENT BY : SHRI T.N.BETGERI, JCIT / DATE OF HEARING : 29-04-2014 /DATE OF PRONOUNCEMENT : 05-06-2014 #( / O R D E R PER VIKAS AWASTHY, J.M: THE APPEALS FOR ASSESSMENT YEARS (AYS) 2004-05, 20 05- 06, 2007-08 AND 2008-09 HAVE BEEN FILED BY THE ASSE SSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-II, CHENNAI, DATED 18-11-2013 COMMON FOR ALL THE FOUR A YS. ITA. NOS. 272, 273, 274 & 275/MDS/2014 :- 2 -: 2. THE ISSUE IN ALL THE APPEALS RELATE TO INCOME EA RNED BY THE ASSESSEE FROM LETTING OUT OF THE BUILDINGS. THE AS SESSEE IN ITS RETURN OF INCOME FOR THE RESPECTIVE AYS HAS CLAIMED THE INCOME FROM LETTING OUT OF BUILDINGS UNDER THE HEAD INCOM E FROM BUSINESS. WHEREAS, THE ASSESSING OFFICER ASSESSED THE RENTAL INCOME FROM THE BUILDINGS UNDER THE HEAD INCOME FR OM HOUSE PROPERTY. AGGRIEVED AGAINST THE ASSESSMENT ORDER FOR THE RESP ECTIVE AYS, THE ASSESSEE PREFERRED APPEALS BEFORE THE CIT( APPEALS). THE CIT(APPEALS) BY PLACING RELIANCE ON THE JUDGMEN T OF THE HONBLE MADRAS HIGH COURT IN ASSESSEES OWN CASE RE PORTED AS 300 ITR 118 (MAD) DISMISSED THE APPEALS OF THE ASSESSEE. NOW, THE ASSESSEE HAS COME IN SECOND APPEAL BEFORE THE T RIBUNAL ASSAILING THE FINDINGS OF CIT(APPEALS). 3. SHRI S.VENUGOPALAN, APPEARING ON BEHALF OF THE A SSESSEE SUBMITTED THAT THE ASSESSEE IS IN THE BUSINESS OF L ETTING OUT OF COMMERCIAL COMPLEXES. REFERRING TO OBJECT CLAUSE O F MEMORANDUM OF ASSOCIATION OF THE ASSESSEE-COMPANY, THE LD.AR SUBMITTED THAT ONE OF THE OBJECTS OF THE COMPANY IS TO MANAGE, LEASE LAND, BUILDINGS AND OTHER PROPERTIES WHETHER OWNED BY THE ITA. NOS. 272, 273, 274 & 275/MDS/2014 :- 3 -: COMPANY OR NOT, COLLECT RENTS AND OTHER REVENUES. THUS, ONE OF THE BUSINESS OF THE ASSESSEE IS LETTING OUT OF BUIL DINGS AND THUS RENTAL INCOME RECEIVED THERE FROM IS ASSESSABLE UND ER THE HEAD INCOME FROM BUSINESS. 4. ON THE OTHER HAND, SHRI T.N.BETGERI, APPEARING O N BEHALF OF THE REVENUE SUBMITTED THAT SIMILAR ISSUE HAD COME U P BEFORE THE HONBLE MADRAS HIGH COURT IN ASSESSEES OWN CASE FO R THE AY.2001-02. THE HONBLE HIGH COURT HAD HELD THAT, RENTAL INCOME EARNED BY ASSESSEE BY LEASING OR LETTING OUT IS LIA BLE TO BE ASSESSED AS INCOME FROM HOUSE PROPERTY. 5. BOTH SIDES HEARD. ORDERS OF THE AUTHORITIES BEL OW AND THE JUDGMENT OF THE HONBLE MADRAS HIGH COURT ON WHICH THE LD.DR HAS PLACED RELIANCE EXAMINED. WE FIND THAT THE ISS UE IN PRESENT APPEALS IS EXACTLY SIMILAR TO THE ONE WHICH HAS ALR EADY BEEN ADJUDICATED BY THE HONBLE JURISDICTIONAL HIGH COUR T IN ASSESSEES OWN CASE FOR THE AY.2001-02 (SUPRA). THE HONBLE H IGH COURT AFTER EXAMINING THE FACTS OF THE CASE HAS HELD THAT THE INCOME DERIVED BY THE ASSESSEE FROM LETTING OUT OF THE BUI LDING IS ASSESSABLE UNDER THE HEAD INCOME FROM HOUSE PROPER TY. THE ITA. NOS. 272, 273, 274 & 275/MDS/2014 :- 4 -: RELEVANT EXTRACT OF THE FINDINGS OF THE HONBLE HIG H COURT ARE AS UNDER: 12. ON THE FACTS OF THE CASE, IT IS CLEAR THAT THE ASSESSEE- COMPANY WAS ONLY EXPLOITING THE PROPERTY AS OWNER B Y LEASING OUT THE SAME AND REALIZED INCOME BY WAY OF RENT. S UCH RENTAL INCOME IS LIABLE TO BE ASSESSED AS INCOME FROM HOUS E PROPERTY. WE FIND THAT THERE IS NO CHANGE IN THE FACTS AND CI RCUMSTANCES IN THE AYS UNDER CONSIDERATION. IN VIEW OF THE JUDGME NT OF THE HONBLE MADRAS HIGH COURT IN ASSESSEES OWN CASE, T HE APPEALS OF THE ASSESSEE FOR ALL THE AYS ARE DISMISSED. ORDER PRONOUNCED ON THURSDAY, THE 05 TH JUNE, 2014 AT CHENNAI. SD/- SD/- ( . . . ) ( ! ) (DR. O.K. NARAYANAN) (VIKAS AWAS THY) / VICE PRESIDENT ! '# / JUDICIAL MEMBER $ /CHENNAI, %'& /DATED: 05 TH JUNE, 2014 TNMM ''(!)*+* /COPY TO: 1. /APPELLANT 2. /RESPONDENT 3. ' ' ,-. /CIT(A) 4. ' ' , /CIT 5. */0!!12 /DR 6. 0345 /GF