AJAYKANT RAMPRASAD RUIA, MUMBAI V. I.T.O. 3(1)(1), MUMBAI

ITA 2887/MUM/2012

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 92648 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-05-2015
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 13-05-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 27-04-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AZGHAR ZAIN
• Keywords: Business income

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, MUMBAI . , , BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 2887/MUM/2012 ( / ASSESSMENT YEAR : 2006 - 07 SHRI AJAYKANT RAMPRASAD RUIA, 4, APPEJAY HOUSE, MUMBAI SAMACHAR MARG, MUMBAI - 400 023 / VS. THE ITO - 3(1)(1), AAYAKAR BHAVAN, MUMBAI - 400 020 ./ ./ PAN/GIR NO. : ACYPR 6429E ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: NONE / RESPONDENT BY : SHRI AZGHAR ZAIN / DATE OF HEARING : 13 . 0 5 .2015 / DATE OF PRONOUNCEMENT : 13 .0 5 .2015 / O R D E R PER N.K. BILLAIYA, AM: THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST THE ORDER OF THE LD. CIT(A) - 5 , MUMBAI DT. 2 5 . 1 .2012 PERTAINING TO ASSESSMENT YEAR 200 6 - 07 . 2. THE SUM AND SUBSTANCE OF THE GRIEVANCE OF THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN CONFIRMING THE ORDER OF THE AO AND TAXING RS. 10,78 ,786/ - AS RENTAL INCOME UNDER THE HEAD NCOME FROM HOUSE ITA. NO. 2887/M/2012 2 PROPERTY INSTEAD OF TREATING THE SAME AS BUSINESS INCOME OF THE ASSESSEE. THE LD. CIT(A) FURTHER ERRED IN NOT ALLOWING THE CLAIM OF LOSS ON THE PRETEXT THAT THERE IS NO BUSINESS ACTIVITIES CARRIED OUT. 3. THE ASSESSEE IS A RESIDENT INDIVIDUAL DERIVING INCOME MAINLY FROM RENT, CAPITAL GAINS, INTEREST AND DIVIDEND. WHILE SCRUTINIZING THE RETURN OF INCOME, THE ASSESSING OFFICER NOTICED THAT THERE IS NO BUSINESS RECEIPTS RECEIVED DURING THE YEAR AND NO BUSINESS ACTIVITY WAS CARRIED OUT BY THE ASSESSEE. THE AO FURTHER NOTICED THAT THE ASSESSEE HAS CLAIMED RENT RECEIVED AS BUSINESS INCOME FROM WHICH EXPENSES WERE CLAIMED AT RS. 19,49,375/ - . ON FURTHER PROBE, THE AO NOTICED THAT THE ASSESSEE HAS RECEI VED GROSS RENT OF RS. 20,53,786/ - AND HAS PAID RENT AT RS. 9,14,195/ - AND THE NET RENT OF RS. 11,39,591/ - WAS CREDITED IN THE PROFIT AND LOSS ACCOUNT. THE AO COMPLETED THE ASSESSMENT BUT TREATING THE RENTAL INCOME UNDER THE HEAD INCOME FROM HOUSE PROPERTY AND DENIED ALL THE CLAIMS MADE BY THE ASSESSEE IN RESPECT OF EXPENSES AND LOSSES. THE AO ALSO TREATED RS. 9,75,000/ - AS INCOME FROM OTHER SOURCES. THE FACT OF THIS TREATMENT SHOW THAT THE ASSESSEE HAS RENTED OUT PART OF HIS PREMISES WHICH IT H AS TAKEN ON RENT THEREFORE, THE AO HAS TREATED THE SAME AS INCOME FROM OTHER SOURCES. 4. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A). AFTER CONSIDERING THE FACTS AND THE SUBMISSIONS AND RELYING UPON THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SHAMBHU INVESTMENTS PVT. LTD. 263 ITR 143, THE LD. CIT(A) CONFIRMED THE ASSESSMENT ORDER. 5. AGGRIEVED BY THIS, THE ASSESSEE IS BEFORE US. 6. NO ONE APPEARED BEFORE US INSPITE OF THE NOTICE SINCE 2013, THEREFORE, WE DECIDED TO PROCEED E X PARTE. ITA. NO. 2887/M/2012 3 7. HAVING HEARD THE LD. DEPARTMENTAL REPRESENTATIVE, CONSIDERED THE ORDERS OF THE LOWER AUTHORITIES AND CONSIDERING THE FACTS IN THE LIGHT OF THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF SHAMBHU INVESTMENTS (SUPRA), WE DO NOT FIND ANY REASON TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). 8. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. OR DER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON 13 TH MAY , 2015 SD/ - SD/ - ( D.MANMOHAN ) (N.K. BILLAIYA) /VICE PRESIDENT / ACCOUNTANT MEMBER MUMBAI ; DATED : 13 TH MAY , 2015 . . ./ RJ , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI