Discovery Estates Pvt. Ltd., New Delhi V. DCIT, New Delhi

ITA 5269/DEL/2015

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 4381 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2011-2012
• Appeal Filed On: 24-08-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SURENDER PAL
• Assessee Lawyers: KESHAV PRASAD
• Keywords: Business income; Principle of natural justice; Question of law

Judgement Text

1 ITA NO. 5269/DEL/2015 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: F NEW DELHI BEFORE SHRI R. K. PANDA, ACCOUNTANT MEMBE R AND MS SUCHITRA KAMBLE, JUDIC IAL MEMBER ITA NO. 5269/DEL/2015 ( A .Y 2011-12) DISCOVERY ESTATES PVT. LTD. 17-B, MGF HOUSE, ASAF ALI ROAD NEW DELHI AABCD4163D (APPELLANT) VS DCIT CIRCLE-10(1) NEW DELHI (RESPONDENT) APPELLANT BY SH. KESHAV PRASAD, CA RESPONDENT BY SH. SURENDER PAL, SR. DR ORDER PER SUCHITRA KAMBLE, JM THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE OR DER DATED 23/06/2015 PASSED BY CIT(A)-III, NEW DELHI FOR ASSESSMENT YEAR 2011-12. 2. THE GROUNDS OF APPEAL ARE AS UNDER:- 1. GROUND NO. 1 : THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - III , NEW DELHI (HEREINAFTER REFERRED TO AS 'CIT(A)') HAS ERRED IN LAW AND IN THE FACT & CIRCUMSTANCES OF THE CASE BY PASSING THE ORDER DATE D 23.06.2015 UNDER SECTION 250 OF THE INCOME TAX ACT, 1961 (HERE INAFTER REFERRED TO AS 'THE ACT') IN GROSS VIOLATION OF THE PRINCIPLES OF NATURAL JUSTICE. DATE OF HEARING 11.02.2019 DATE OF PRONOUNCEMENT 11.02.2019 2 ITA NO. 5269/DEL/2015 GROUND NO. 2 : THE CIT(A) HAS ERRED ON FACTS AND CIRCUMSTANCES OF THE CASE IN HOLDING THAT THE AO IS CORRECT IN TREATING THE LEASE RENTAL INCOME EARNED BY THE APPELLANT FROM COMMERCIAL PROPERTIES AS INCOME FROM HOUSE PROPERTY INSTEAD OF BUSINESS INCOME. GROUND NO. 3: THE CIT(A) HAS ERRED ON FACTS AND CIRCUMSTANCES OF THE CASE IN CONFIRMING THE CONCLUSION OF AO WITH REGARD TO THE TAXING OF RENTAL INCOME ON ACCOUNT OF COMMERCIAL MALL AS INCOME FROM HOUSE PROPERTY INSTEAD OF INCOME FROM BUSINESS ON THE BASIS OF HON 'BLE DELHI HIGH COURT ORDER DATED 18.02.2013. THE APPELLANT CONTEND S THAT THE ORDER OF HON'BLE DELHI HIGH COURT HAS NOT ATTAINED FINALI TY AS THE APPELLANT HAS ALREADY FILED AN APPEAL IN THIS REGARD BEFORE H ON'BLE SUPREME COURT. GROUND NO. 4 THE CIT(A) HAS ERRED ON FACTS AND CIRCUMSTANCES OF THE CASE IN HOLDING THAT THE AO IS CORRECT IN HOLDING THAT INTEREST INC OME ON FDR'S SHOULD BE TREATED AS 'INCOME FROM OTHER SOURCES'. THE APPE LLANT CONTENDS THAT THE INTEREST INCOME SHOULD NOT BE CATEGORIZED UNDER THE HEAD 'INCOME FROM OTHER SOURCES' AND IT SHOULD BE TREATED AS BUS INESS INCOME. THE APPELLANT PRAYS THAT HE MAY BE ALLOWED TO ADD, AMEND, ALTER OR FOREGO ANY OF THE ABOVE GROUNDS OF APPEAL AS THE CI RCUMSTANCES MAY WARRANT. 3 ITA NO. 5269/DEL/2015 3. AT THE TIME OF HEARING, THE LD. AR SUBMITTED THA T THE ISSUE CONTESTED BY THE ASSESSEE IN THE PRESENT APPEAL HAS BEEN DECIDED AGAINST THE ASSESSEE BY THE HON'BLE SUPREME COURT IN EARLIER ASSESSMENT YEA RS IN LIGHT OF THE DECISION OF M/S ANSAL HOUSING FINANCE & LEASE COMPANY LTD. D ECIDED ON 31/10/2012 IN ASSESSEES OWN CASE BEING ITA NO. 1089 & 1090/ 2 011 DATED 18/2/2013 CIT(A) VS. DISCOVERY STATES PVT. LTD. THE LD. AR F URTHER SUBMITTED THAT THE ASSESSEE HAS FILED SLP BEFORE THE HON'BLE SUPREME C OURT WHICH IS YET PENDING BUT AS OF TODAY, THE ISSUE IS COVERED AGAINST THE A SSESSEE. THE LD. AR SUBMITTED FORM NO. 8 AS UNDER:- FORM NO. 8 [ SEE RULE 16] DECLARATION UNDER SECTION 158A(1) OF THE INCOME-TAX ACT, 1961 TO BE MADE BY AN ASSESSEE CLAIMING THAT IDENTICAL QUESTIO N OF LAW IS PENDING BEFORE THE HIGH COURT OR THE SUPREME COURT I, KHEM CHAND AGRAWAL, SON/DAUGHTER/WIFE OF SHRI G. S. AGRAWAL BEING THE DIRECTOR OF THE APPELLANT DO HEREBY DECLARE: 1. THAT THE FOLLOWING QUESTION OF LAW IS PENDING IN TH E CASE OF DISCOVERY ESTATES PRIVATE LIMITED BEFORE THE SUPREME COURT ON AN APPEAL UNDER SECTION 261 IN RESPECT OF THE ASSESSMENT YEAR 2006- 07. A COPY OF THE JUDGMENT OF THE HIGH COURT AND RECORD OF PROCEEDING S RELATED THE SUPREME COURT ARE ENCLOSED. 2. THAT THE SAID QUESTION OF LAW IS IDENTICAL WITH THE QUESTION OF LAW ARISING IN THE CASE OF DISCOVERY ESTATES PRIVATE LIMITED IN RE SPECT OF THE ASSESSMENT YEAR AY 2011-12 WHICH IS PENDING BEFORE THE HONBLE INCOME TAX APPELLANT TRIBUNAL, DELHI, BENCH-F. 3. THAT IF THE HONBLE INCOME TAX APPELLANT TRIBUNAL A GREES TO APPLY TO THE CASE REFERRED TO IN PARAGRAPH 2 ABOVE THE FINAL DEC ISION ON THE QUESTION OF 4 ITA NO. 5269/DEL/2015 LAW IN THE CASE REFERRED TO IN PARAGRAPH 1 ABOVE, T HE ASSESSEE MENTIONED IN PARAGRAPHS 1 AND 2 ABOVE, SHALL NOT RAISE THE SAID QUESTIONS OF LAW IN THE CASE REFERRED TO IN PARAGRAPH 2 ABOVE IN APPEAL BEF ORE ANY APPELLATE AUTHORITY OR FOR A REFERENCE BEFORE THE HIGH COURT UNDER SECTION 256 OR THE SUPREME COURT UNDER SECTION 257 OR IN APPEAL BEFORE THE SUPREME COURT UNDER SECTION 261. SIGNATURE OF THE DECLARANT: PERMANENT ACCOUNT NO: AABCD4163D NEW DELHI-110002 4. THE LD. DR RELIED UPON THE ORDER OF THE HON'BLE HIGH COURT IN ASESSEESS OWN CASE FOR EARLIER ASSESSMENT YEARS. 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. THE ASSESSEE THROUGH ITS AR HAS RIGHTLY SU BMITTED THAT THE ISSUE CONTENTED IN THE PRESENT APPEAL IS DECIDED AGAINST THE ASSESSEE BY THE HONBLE JURISDICTIONAL HIGH COURT. THEREFORE, THIS APPEAL IS DISMISSED BUT IN LIGHT OF THE SLP PENDING BEFORE THE HON'BLE SUPREME COURT. THE ASSESSEE IS AT LIBERTY TO TAKE APPROPRIATE ACTION IF THE HONBLE APEX COUR T DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. 6. IN RESULT, THE APPEAL OF THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH FEBRUARY, 2019 . SD/- SD/- (R. K. PANDA) (SUCHITRA KAMBLE) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 11/02/2019 R. NAHEED 5 ITA NO. 5269/DEL/2015 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI DATE OF DICTATION 11.02.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 11.02.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 1 1 . 02.2019 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 1 1 . 02.2019 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 1 1 . 02.2019 6 ITA NO. 5269/DEL/2015 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER