K.M.K.Sundara Prakash, CHENNAI V. ITO International Taxation 2(2), CHENNAI

ITA 2767/CHNY/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 4266 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 17-11-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SRIDHAR DORA IRS JCIT
• Assessee Lawyers: T BANUSEKAR
• Keywords: Business income; Principle of natural justice
• Section: 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, B BENCH : CHENNAI , . , [BEFORE SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER AND SHRI DUVVURU RL REDDY , JUDICIAL MEMBER ] !' ./I.T.A. NO.2767/CHNY/2017. #$% &$ / ASSESSMENT YEAR : 2013-2014 K.M.K. SUNDARA PRAKASH NO.37, NEW NO.3, 2 ND CROSS STREET, EAST SHENOY NAGAR, CHENNAI 600 030. VS. THE INCOME TAX OFFICER, INTERNATIONAL TAXATION 2(2) CHENNAI. [PAN AASPS 1884Q] ( / APPELLANT) ( /RESPONDENT) !' '( ) * / APPELLANT BY : SHRI. T. BANUSEKAR, C.A. +,'( ) * /RESPONDENT BY : SHRI. SRIDHAR DORA, IRS, JCIT. # - ) . /DATE OF HEARING : 30-04-2019 /0&% ) . /DATE OF PRONOUNCEMENT : 10-05-2019 / O R D E R PER INTURI RAMA RAO, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE DIRECTED AG AINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-1 6, CHENNAI (CIT(A) FOR SHORT) DATED 01.08.2017 FOR THE ASSES SMENT YEAR (AY) 2013-14. ITA NO.2767 /2017 :- 2 -: 2. THE ASSESSEE RAISED THE FOLLOWING GROUNDS OF APPEA L. 1. FOR THAT THE ORDER OF THE COMMISSIONER OF INCO ME TAX (APPEALS) IS CONTRARY TO THE LAW, FACTS AND CIRCUMSTANCES OF THE CASE TO THE EXTENT PREJUDICIAL TO THE INTEREST OF THE ASSESSEE AND IS OPPOSED TO THE PRIN CIPLES OF EQUITY, NATURAL JUSTICE AND FAIR PLAY. 2. FOR THAT THE COMMISSIONER OF INCOME TAX (APPEALS ) FAILED TO APPRECIATE THAT THE ORDER OF THE ASSESSIN G OFFICER IS WITHOUT JURISDICTION. 3. FOR THAT THE COMMISSIONER OF INCOME TAX (APPEALS ) ERRED IN UPHOLDING THE COMPOSITE RENT RECEIPTS OF T HE APPELLANT TO THE EXTENT OF RS.71 ,21 ,055/- WERE ASSESSABLE UNDER THE HEAD INCOME FROM HOUSE PROPERT Y. 4. FOR THAT THE COMMISSIONER OF INCOME TAX (APPEALS ) ERRED IN UPHOLDING THE RECEIPTS TO THE EXTENT OF RS.24,41,565/- WERE ASSESSABLE UNDER THE HEAD INCOM E FROM OTHER SOURCES. 5. FOR THAT THE COMMIS SIONER OF INCOME TAX (APPEALS) FAILED TO APPRECIATE THAT THE APPELLANT'S INTENTION WAS TO EXPLOIT THE PROPERTY BY PERFORMING COMMERCIAL ACTIV ITIES AND NOT TO MERELY LET OUT THE PROPERTY. 6. FOR THAT THE COMMISSIONER OF INCOME TAX (APPEALS ) OUGHT TO HAVE ACCEPTED THE ENTIRE INCOME RETURNED B Y THE APPELLANT AS BUSINESS INCOME. 7. FOR THAT WITHOUT PREJUDICE TO THE ABOVE, THE COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE DIRECTED TO ASSESS THE ENTIRE RENTAL INCOME UNDER T HE HEAD INCOME FROM THEIR SOURCES AND ALLOWED THE ENTIRE EXPENSES CLAIMED AGAINST THE SAME AS THE LETTING OU T OF BUILDING AND FURNISHING ARE INSEPARABLE. 8. FOR THAT, WITHOUT PREJUDICE TO THE ABOVE, HAVING ASSESSED THE RECEIPTS FOR FURNISHINGS AND MAINTENAN CE COST REIMBURSEMENT UNDER THE HEAD INCOME FROM OTHER SOURCES THE COMMISSIONER OF INCOME TAX (APPEALS) OU GHT TO HAVE ALLOWED DEDUCT ON U/S.57 OF ALL EXPENSES CL AIMED BY THE APPELLANT. ITA NO.2767 /2017 :- 3 -: 9. FOR THAT THE COMMISSIONER OF INCOME TAX (APPEALS ) FAILED TO APPRECIATE THAT ALL EXPENSES INCURRED BY THE APPELLANT WERE TOWARDS MAINTENANCE OF THE IMMOVABLE PROPERTIES. 10. FOR THAT THE APPELLANT OBJECTS TO THE LEVY OF INTEREST U/S.234B. 3. THE BRIEF FACTS OF THE CASE ARE AS UNDER:- THE APPELLANT IS AN INDIVIDUAL DERIVING INCOME U NDER THE HEAD INCOME FROM HOUSE PROPERTY. THE RETURN OF INCOME FOR THE ASSESSMENT YEAR 2013-14 WAS FILED ON 26.09.2013 DIS CLOSING TOTAL INCOME OF A2,76,01,720/-. AGAINST THE SAID RETURN OF INCOME, THE ASSESSMENT WAS COMPLETED BY INCOME TAX OFFICER, INT ERNATIONAL TAXATION 2(2), CHENNAI (HEREINAFTER CALLED ASSES SING OFFICER') VIDE ORDER DATED 17.03.2016 PASSED UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) AT TOTAL INCOM E OF A2,96,78,300/-. WHILE DOING SO, THE ASSESSING OFFICER TREATED THE RENTAL INCOME RECEIVED FROM M/S. DSV AIR AND SEA PVT. LTD AND M/ S. NUANCE TRANSCRIPTION SERVICES INDIA (P) LTD UNDER THE HEAD INCOME FROM HOUSE PROPERTY AS AGAINST THE CLAIM OF THE ASSESS EE THAT THE INCOME SHOULD BE ASSESSED UNDER THE HEAD INCOME FROM BU SINESS. IT IS ADMITTED FACT BEFORE THE LD. ASSESSING OFFICER THAT APPELLANT HAD LET OUT A COMMERCIAL PROPERTY NOT A SHELL PROPERTY AND THE RENTAL INCOME ITA NO.2767 /2017 :- 4 -: INCLUDES RENT TOWARDS FURNITURE FIXTURES, LIFT, GE NERATOR, SECURITY SERVICES, AIR CONDITIONER, CUBICAL, PANTRY AND EQUI PMENT ALONGWITH SERVICES ON DAY TO DAY BASIS. IT IS SUBMITTED THAT RENTAL INCOME SHOULD BE ASSESSED UNDER THE HEAD INCOME FROM BUSINESS . HOWEVER, LD. ASSESSING OFFICER HAD NOT ACCEPTED THE CONTENTION. THE RENT RECEIVED TOWARDS FURNISHING FROM M/S. NUANCE TRANSCRIPTION SERVICES INDIA (P) LTD WAS ASSESSED TO TAX UNDER THE HEAD INCOME FRO M OTHER SOURCES AND THE BALANCE INCOME WAS ASSESSED UNDER THE HEAD INCOME FROM HOUSE PROPERTY. 4. BEING AGGRIEVED BY THE ABOVE ORDER, AN APPEAL WAS PREFERRED BEFORE LD. CIT(A) CONTENDING THAT IT IS A CASE OF INSEPARABLE LETTING OFF OF BUILDING AND FURNITURE AND THEREFORE INCOME SHOULD BE ASSESSED TO TAX EITHER UNDER THE HEAD INCOME FR OM BUSINESS INCOME OR INCOME FROM OTHER SOURCES, AND THE FACT THAT ONCE THE LETTING IS FOUND TO BE INSEPARABLE, RENT THEREFROM CANNOT BE ASSESSED TO TAX UNDER THE HEAD INCOME FROM HOUSE PROPERTY, PLACING RELIANCE ON THE DECISION OF HONBLE SUPREME COURT IN THE CAS E OF SULTAN BROTHERS (P) LTD VS. CIT, (1964) 51 ITR 353. HOWEVER, LD. COMMISSIONER OF INCOME TAX (APPEALS) HAD NOT ACCEPT ED THE ABOVE CONTENTION BY HOLDING THAT LETTING OUT OF FURNISHI NGS WHICH IS INCIDENTAL CANNOT BE TREATED AS INCOME FROM BUSINES S ACTIVITIES. ACCORDINGLY HE DISMISSED THE APPEAL. ITA NO.2767 /2017 :- 5 -: 5. BEING AGGRIEVED, THE APPELLANT IS IN APPEAL BEFORE US IN THE PRESENT APPEAL. IT IS CONTENTED THAT THE BUILDING WAS LET OUT TO THE TENANTS WITH FURNITURE AND FIXTURES AND THE FURNIT URE AND FIXTURES CANNOT BE LET OUT INSEPARABLY FROM THE HOUSE PROP ERTY. THEREFORE IT IS A CASE OF INSEPARABLE LETTING OFF OF HOUSE PROPERTY WITH FURNITURE AND FIXTURES. THEREFORE THE RATIO OF DECISION OF HONB LE SUPREME COURT IN THE CASE OF SULTAN BROTHERS (P) LTD (SUPRA) IS SQUARELY APPLICABLE . 6. ON THE OTHER HAND, THE LD. SR. DEPARTMENTAL REPRESE NTATIVE PLACED RELIANCE ON THE ORDERS OF LOWER AUTHORITIES. 7. WE HEARD THE RIVAL SUBMISSION AND PERUSED THE MATER IAL ON RECORD. THE SHORT ISSUE THAT ARISE IN THE PRESENT A PPEAL IS WHETHER THE COMPOSITE RENT RECEIVED BY THE ASSESSEE TOWARDS LET TING OFF OF BUILDING ALONGWITH FURNITURE AND FIXTURES AND OTHER AMENITIE S CONSTITUTE BUSINESS INCOME OR INCOME FROM HOUSE PROPERTY. IN ORDER TO ASSESS THE INCOME ARISING FROM AN ASSET UNDER THE HEAD BU SINESS INCOME, AN ASSESSEE HAS TO DO BUSINESS BY EXPLOITING THE COMM ERCIAL ASSET. THERE IS NOTHING ON RECORD TO SHOW THAT BUILDING WHICH IS LET OUT IS A COMMERCIAL ASSET. THE MERE FACT THAT THE APPELLANT LET OUT THE PREMISES WITH FURNITURE, FIXTURES, AIR-CONDITIONER S AND PROVIDED SERVICES LIKE WATCH AND WARD STAFF, ELECTRICITY, W ATER AND OTHER COMMON AMENITIES AND COMPOSITE RENT WAS COLLECTED T OWARDS ALL ITA NO.2767 /2017 :- 6 -: AMENITIES PROVIDED, IT CANNOT BE SAID THAT ASSESSEE WAS EXPLOITING THE PROPERTY FOR COMMERCIAL ACTIVITY AS HELD BY HONBL E CALCUTTA HIGH COURT IN THE CASE OF CIT VS. SHAMBHU INVESTMENT PVT. LTD, 249 ITR 47 AFFIRMED BY THE HONBLE SUPREME COURT IN THE CASE O F SHAMBHU INVESTMENT PVT. LTD VS. CIT, 263 ITR 143. HONBLE CALCUTTA HIGH COURT AFTER APPLYING THE RATIO OF DECISION OF HONB LE SUPREME COURT IN THE CASE OF SULTAN BROTHERS (P) LTD (SUPRA) HELD THAT WHEN THE PROPERTY WAS LET OUT ALONGWITH FURNITURE AND FIXTUR ES AND BY PROVIDING SECURITY AND OTHER AMENITIES, IN THE ABSENCE OF SEP ARATE AGREEMENT, IT WAS HELD THAT THE INCOME SHOULD BE ASSESSED UNDER T HE HEAD INCOME FROM HOUSE PROPERTY. RELEVANT PARAS OF THE SAID DECISION ARE REPRODUCED HEREUNDER:- LET US APPROACH THE PROBLEM FROM ANOTHER ANGLE BY APPLYING THE TEST SUGGESTED BY THE FIVE JUDGES BENCH IN THE CAS E OF SULTAN BROTHERS PVT. LTD. [1964] 51 ITR 353 (SC). THE THREE QUESTIONS FRAMED BY THE APEX COURT ARE APPLIED IN THE INSTANT CASE AS FOLLOWS (PAGE 363) : (A) WAS IT THE INTENTION IN MAKING THE LEASE-AND IT MATTERS NOT WHETHER THERE IS ONE LEASE OR TWO, I.E., SEPARATE L EASES IN RESPECT OF THE FURNITURE AND THE BUILDING-THAT THE TWO SHOU LD BE ENJOYED TOGETHER ? IN THE INSTANT CASE THERE IS NO SEPARATE AGREEMENT FOR FURNITURE AND FIXTURES OR FOR PROVIDING SECURITY AND OTHER AM ENITIES. THE ONLY INTENTION, IN OUR VIEW, WAS TO LET OUT THE POR TION OF THE PREMISES TO THE RESPECTIVE OCCUPANTS. HENCE, THE IN TENTION IN MAKING SUCH AGREEMENT IS TO ALLOW THE OCCUPANTS TO ENJOY THE TABLE SPACE TOGETHER WITH THE FURNITURE AND FIXTURE S. HENCE, THIS QUESTION SHOULD BE ANSWERED IN THE AFFIRMATIVE. (B) WAS IT THE INTENTION TO MAKE THE LETTING OF THE TWO PRACTICALLY ONE LETTING (PAGE 363) : ITA NO.2767 /2017 :- 7 -: FROM A PLAIN READING OF THE AGREEMENT IT APPEARS TH AT THE INTENTION OF THE PARTIES TO THE SAID AGREEMENT IS C LEAR AND UNAMBIGUOUS BY WHICH THE FIRST PARTY HAS ALLOWED TH E SECOND PARTY TO ENJOY THE SAID TABLE SPACE UPON PAYMENT OF THE COMPREHENSIVE MONTHLY RENT. HENCE, THIS QUESTION SH OULD BE ANSWERED IN THE AFFIRMATIVE. (C) WOULD ONE HAVE BEEN LET ALONE, AND A LEASE OF I T ACCEPTED, WITHOUT THE OTHER (PAGE 363) ? AS WE HAVE DISCUSSED HEREINBEFORE THAT IT IS COMPOS ITE TABLE SPACE LET OUT TO VARIOUS OCCUPANTS, THE AMENITIES G RANTED TO THOSE OCCUPANTS INCLUDING THE USER OF THE FURNITURE AND F IXTURES ARE ATTACHED TO SUCH LETTING OUT AND THE LAST QUESTION, IN VIEW OF THE SAME, MUST BE ANSWERED IN THE NEGATIVE. APPLYING THE SAID TEST WE HOLD THAT BY THE SAID AGR EEMENT THE PARTIES HAVE INTENDED THAT SUCH LETTING OUT WOULD B E AN INSEPARABLE ONE. HENCE, WE HOLD THAT THE PRIME OBJECT OF THE ASSESSE E UNDER THE SAID AGREEMENT WAS TO LET OUT THE PORTION OF THE SA ID PROPERTY TO VARIOUS OCCUPANTS BY GIVING THEM ADDITIONAL RIGHT O F USING THE FURNITURE AND FIXTURES AND OTHER COMMON FACILITIES FOR WHICH RENT WAS BEING PAID MONTH BY MONTH IN ADDITION TO THE SE CURITY FREE ADVANCE COVERING THE ENTIRE COST OF THE SAID IMMOVA BLE PROPERTY. IN VIEW OF THE FACTS AND LAW DISCUSSED ABOVE WE HOL D THAT THE INCOME DERIVED FROM THE SAID PROPERTY IS AN INCOME FROM PROPERTY AND SHOULD BE ASSESSED AS SUCH. THE RATIO OF THE ABOVE DECISION WAS FOLLOWED BY H ONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. SANMAR HOLDINGS LTD, 272 ITR 341 , WHEREIN IT WAS HELD AS UNDER: 5. WE FIND FROM THE ORDER OF THE TRIBUNAL THAT TH E TRIBUNAL HELD THAT THE RENTAL INCOME SHOULD BE ASSE SSED UNDER THE HEAD ' INCOME FROM BUSINESS OR PROFESSION ' AS BUSINESS ON THE BASIS OF THE OBJECTS CLAUSE OF T HE ASSESSEE' S COMPANY. THE OBJECT CLAUSE, WHICH WAS RELIED ON BY THE TRIBUNAL, READS AS UNDER : ITA NO.2767 /2017 :- 8 -: ' TO CARRY ON THE BUSINESS OF DEALERS IN SHARES, STOCKS, DEBENTURES, STOCKS, BONDS, OBLIGATIONS, WHITS, SECURITIES AND TO PURCHASE, TAKE ON LEASE OR IN EXCHANGE, HIRE OR OTHERWISE ACQUIRE AND DEAL IN ANY MOV ABLE OR IMMOVABLE PROPERTY, PATTAS, LICENCES, RIGHTS OR PRIVILEGES AND TO DEVELOP AND TURN THEM TO ACCOUNT.' 6. THE TRIBUNAL WAS OF THE VIEW THAT THE OBJECTS CL AUSE WOULD BE SUFFICIENT TO HOLD THAT THE INCOME FROM TH E PROPERTY SHOULD BE TREATED AS INCOME FROM BUSINESS. THE TRIBUNAL HELD THAT THE EXPRESSION ' TURN THEM I NTO ACCOUNT' IN THE OBJECTS CLAUSE WOULD INCLUDE THE TRANSACTION OF LEASE BECAUSE ESSENTIALLY, THE OBJEC T OF THE ASSESSEE WAS TO DERIVE PROFIT FROM THE PROPERTI ES AND SUCH INCOME COULD BE DERIVED NOT ONLY BY SALE B UT ALSO BY LETTING OUT. THEREAFTER, THE TRIBUNAL HELD THAT THE INCOME FROM THE BUILDING SHOULD BE ASSESSED AS ' INCOME FROM BUSINESS' . 7. HOWEVER, WE ARE UNABLE TO ACCEPT THE VIEW OF THE APPELLATE TRIBUNAL AS THE TRIBUNAL HAS FOCUSSED ITS ATTENTION ONLY TO THE OBJECTS CLAUSE OF THE ASSESSE E- COMPANY. THIS COURT IN ANAIKAR TRADERS AND ESTATES P. LTD. V. CIT (NO. 1) [1990] 186 ITR 175 HAS HELD THAT THERE MUST BE MATERIAL TO SHOW THAT THE ASSESSEE TREATED THE PROPERTY AS COMMERCIAL ASSET. THIS COUR T IN THE SAID CASE NOTICED THE DECISION OF THE SUPREME C OURT IN KARANPURA DEVELOPMENT CO. LTD. V. CIT [1962] 44 ITR 362 AND AFTER NOTICING THE SAID DECISION LAID DOWN THE LAW AS UNDER (PAGE 179) : ' EARLIER, ON A CONSIDERATION OF THE MEMORANDUM OF ASSOCIATION RELATING TO THE MAIN OBJECT OF THE COMPANY, IT HAS BEEN FOUND THAT ITS OBJECT IS TO ACQUIRE AND POSSESS PROPERTY. WHAT IS SIGNIFICANT I S THAT IN THE MEMORANDUM OF ASSOCIATION, THERE IS NO INDICATION THAT THE ASSES SEE-COMPANY INTENDED TO SELL THOSE PROPERTIES OR EVEN TURN THEM TO ACCOUNT BY WAY OF LEASING THEM AS PART OF ITS BUSINESS ACTIVITIES. WE MAY MENTION IN PASSING THAT IN THE COURSE OF THE ORDER OF THE APPEL LATE ASSISTANT COMMISSIONER, A CLEAR FINDING HAD BEEN RECORDED TO THE EFFECT THAT ON A PERUSAL OF THE RECORDS OF THE ASSESSEE-COMPANY, THE ASSESSEE- COMPANY HAD NOT CARRIED ON ANY BUSINESS IN REAL ESTATE. WE, THEREFORE, HOLD THAT THE ASSESSEE- ITA NO.2767 /2017 :- 9 -: COMPANY CANNOT BE REGARDED AS HAVING ACQUIRED THE PROPERTIES AS COMMERCIAL ASSETS FOR THE PURPOSES OF ANY BUSINESS CARRIED ON BY IT AND, THEREFORE, THE RECEIPT OF INCOME FROM THE PROPERTIES HELD BY THE ASSESSEE-COMPANY CANNOT BE REFERRED TO A SUBSTITUTED USER OF THE COMMERCIAL ASSET BY THE ASSESSEE-COM PANY, AS CLAIMED BY IT, SO AS TO CONSTITUTE THE INCOME FROM THE PRO PERTIES AS ' PROFITS AND GAINS OF THE BUSINESS' CARRIED ON BY THE ASSES SEE-COMPANY. INASMUCH AS WE HAVE COME TO THE CONCLUSION THAT THE PROPERTIES WERE NOT HELD BY THE ASSESSEE-COMPANY AS PART OF ITS BUSINESS ASSETS, IT FOLLOWS THAT THE INCOME FROM THOSE PROPERTIES WERE RIGHTLY ASSESSED UNDER THE HEAD ' INCOME FROM PROPERTY', SUBJECT TO THE DEDUCTIONS PROVIDED UNDER SECTION 24 OF THE ACT. IN THE VIEW WE HAVE TAKEN, IT IS UNNECESSARY TO REFER TO THE SEVERAL DECISIONS RELIED ON BY COUNSEL ON BOTH SIDES. WE, THEREFORE, ANSWER THE COMMON QUESTION REFERRED TO US IN THE AFFIRMATIVE AND AGAINST THE ASSESSEE-COMPANY.' 8. THIS COURT HELD THAT THERE MUST BE SOME MATERIAL TO SHOW THAT THE ASSESSEE TREATED THE PROPERTY AS COMMERCIAL ASSET. 9. ON THE FACTS OF THE CASE, WE FIND THAT THE COMMISSIONER OF INCOME-TAX (APPEALS) DECIDED THE MATTER ON THE GROUND THAT THE COMPANY DID NOT HAVE ANY OBJECTS CLAUSE AND HENCE HE HELD THAT THE INCOM E SHOULD BE ASSESSED AS INCOME FROM HOUSE PROPERTY. THE APPELLATE TRIBUNAL DECIDED ON THE BASIS OF THE OBJECTS CLAUSE. THE TRIBUNAL DID NOT EXAMINE THE QUESTION AS TO WHAT ARE THE MAIN OBJECTS AND WHAT A RE THE INCIDENTAL OBJECTS OF THE COMPANY, BUT DECIDED THE CASE ON THE BASIS OF THE OBJECTS CLAUSE, PARTICULAR LY, WITH REFERENCE TO THE EXPRESSION ' TURN THEM TO ACCOUNT' IN THE SAID OBJECTS CLAUSE. 10. WE ARE OF THE VIEW THAT THERE MUST BE SOME MATERIAL BEFORE THE TRIBUNAL TO SHOW THAT THE PROPE RTY IN QUESTION WAS A COMMERCIAL ASSET AND THE ASSESSEE MUST ESTABLISH THAT THE PROPERTY WAS A COMMERCIAL ASSET APART FROM THE OBJECT CLAUSE THEN ONLY THE IN COME DERIVED FROM THE PROPERTY MUST BE TREATED AS INCOME DERIVED FROM COMMERCIAL ASSET. ITA NO.2767 /2017 :- 10 -: 11. WE FIND THAT THE CALCUTTA HIGH COURT IN CIT V. SHAMBHU INVESTMENT P. LTD. [2001] 249 ITR 47 CONSIDERED THE MATTER IN DETAIL AND LAID DOWN THE PRINCIPLES OF LAW. WE ARE IN RESPECTFUL AGREEMENT W ITH THE LAW LAID DOWN BY THE CALCUTTA HIGH COURT IN CIT V. SHAMBHU INVESTMENT P. LTD. [2001] 249 ITR 47 . 12. LEARNED COUNSEL APPEARING FOR THE ASSESSEE BROU GHT TO OUR ATTENTION THE DECISION OF THIS COURT IN CIT V. B. NAGI REDDY [1984] 147 ITR 337 AND ALSO THE DECISION IN CIT V. V. S. T. MOTORS P. LTD. [1997] 226 ITR 155 (MAD). IN ALL THESE CASES, IT WAS FOUND THAT THE ASSET WAS A COMMERCIAL ASSET AND THEREFORE THERE WAS NO DIFFICU LTY IN HOLDING THAT THE INCOME DERIVED FROM THE COMMERC IAL ASSET WOULD AMOUNT TO BUSINESS INCOME. 13. SINCE THE ESSENTIAL FACTS ARE LACKING, WE ARE O F THE VIEW THAT THE MATTER SHOULD GO BACK TO THE TRIBUNAL TO DECIDE THE QUESTION IN THE LIGHT OF THE PRINCIPLES LAID DOWN EARLIER. IT IS ALSO RELEVANT TO REFER TO THE E ARLIER DECISION OF THIS COURT IN CIT V. INDIAN WAREHOUSING INDUSTRIES LTD. [2002] 258 ITR 93 WHEREIN THIS COURT HAS HELD THAT THE SOURCE OF INCOME BEING THE WAREHOUSES , IT MATTERED LITTLE AS TO WHO THE LESSEE FOR THE TIME B EING WAS, WHETHER IT WAS THE SAME LESSEE CONTINUING OVER A PERIOD OF TIME OR A SHIFTING CLASS OF LESSEES WHO OCCUPIED THE SPACES FOR SHORTER PERIODS AND PAID RE NTAL FOR SUCH USE. THIS COURT HELD THAT INCOME WAS ASSESSABLE AS INCOME FROM PROPERTY. HOWEVER, IT IS NOT NECESSARY TO EXPRESS OUR OPINION AS IT IS THE CASE OF THE ASSESSEE THAT THE COMPANY HAS THE NECESSARY OBJECTS CLAUSE AND THE PROPERTY WAS A COMMERCIAL ASSET BUT IT IS FOR THE ASSESSEE TO ESTABLISH THE SAME. SINCE TH E TRIBUNAL HAS NOT GONE INTO THE FACTUAL QUESTIONS, W E REMIT THE MATTER TO THE TRIBUNAL WITH A DIRECTION T O RECONSIDER THE QUESTION AFRESH IN ACCORDANCE WITH L AW. THE TAX CASES ARE DISPOSED OF ACCORDINGLY. NO COSTS . 14. WE MAKE IT CLEAR THAT IT IS ALWAYS OPEN TO THE ASSESSEE TO PRODUCE FURTHER EVIDENCE BEFORE THE TRIBUNAL AND IT IS ALSO OPEN TO THE TRIBUNAL TO REM IT THE MATTER TO THE ASSESSING OFFICER. ITA NO.2767 /2017 :- 11 -: 8. HAVING REGARD TO THE LEGAL POSITION DISCUSSED ABOVE , FACTS IN THE PRESENT CASE ARE IDENTICAL TO THE FACTS IN THE CASE OF SHAMBHU INVESTMENT PVT LTD (SUPRA) AND SANMAR HOLDINGS LTD (SUPRA). THEREFORE WE RESPECTFULLY FOLLOWING THE ABOVE DECIS IONS, HOLD THAT INCOME FROM PROPERTY SHOULD BE ASSESSED UNDER THE H EAD INCOME FROM HOUSE PROPERTY AND UPHOLD THE ORDERS OF THE LOWER AUTHORITIES. WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORD ERS OF THE LOWER AUTHORITIES. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISMIS SED. ORDER PRONOUNCED ON 10TH DAY OF MAY, 2019, AT CH ENNAI. SD/- SD/- ( . ! ) (DUVVURU RL REDDY) ' #$ /JUDICIAL MEMBER ( ) (INTURI RAMA RAO) /ACCOUNTANT MEMBER 1 #- / CHENNAI 2# / DATED:10 TH MAY, 2019. KV 3 ) +.4 5' !6 5&. / COPY TO: 1 . !' '( / APPELLANT 3. 7. (!' ) / CIT(A) 5. 5 :; +.#< / DR 2. +,'( / RESPONDENT 4. 7. / CIT 6. ;$ =- / GF