SHREEJI EXHIBITORS, MUMBAI V. ASST CIT CEN CIR 41, MUMBAI

ITA 640/MUM/2014

• Counselvise Citation: 64019914 RSA 2014
• Duration Of Justice: 1 year(s) 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2009-2010
• Appeal Filed On: 27-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Assessee Lawyers: V MOHAN
• Keywords: Business income; Depreciation
• Section: 28

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E , MUMBAI BEFORE SHRI R.C. SHARMA , ACCOUNTANT MEMBER AND SHRI SANJAY GARG , JUDICIAL MEMBER ITA NO. 640/M/2014 ASSESSMENT YEAR: 2009 - 10 M/S. SHREEJI EXHIBITORS, OLD S.NO.677 (7A), NEW S. NO.277, NEAR TEMBA HOSPITAL, FATAK ROAD, BHAYANDAR (WEST), THANE 401 101 PAN: ABCFS 4464M VS. ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 41, 659, 6 TH FLOOR, AAYAKAR BHAVAN, MUMBAI - 400020 (APPELLANT) (RE SPONDENT) ITA NO. 2196/M/2013 ASSESSMENT YEAR: 2009 - 10 M/S. SHREEJI ENTERPRISES, OLD S.NO.677 (7A), NEW S. NO.277, NEAR TEMBA HOSPITAL, FATAK ROAD, BHAYANDAR (WEST), THANE 401 101 PAN: AB IFS 1322G VS. ASSTT. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 4 3 , 659, 6 TH FLOOR, AAYAKAR BHAVAN, MUMBAI - 400020 (APPELLANT) (RESPONDENT) PRESENT FOR: ASSESSEE BY : SHRI V. MOHAN, A.R. REVENUE BY : SHRI NEIL PHILIP, D.R. DATE OF HEARING : 06.07 .201 5 DATE OF PRONOUNCEMENT : 14.08 .2015 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE ABOVE TITLED APPEAL S HAVE BEEN PREFERRED BY TWO DIFFERENT ASSESSEES AGAINST THE ORDER S OF THE COMMISSIONER OF INCOME TAX (APPEALS) [HEREINAFTER REFERRED TO AS THE CIT(A)] D ATED 10.12.2013 AND 26.12.2012 RESPECTIVELY. ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 2 SINCE THE FACTS AND ISSUES INVOLVED THEREIN ARE IDENTICAL IN NATURE, HENCE THE SAME WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER. FOR THE SAKE OF CONVENIENCE, FACTS HAVE BEEN TAKEN FROM I TA NO.640/M/ 2014. 2. THE COMMON ISSUE RAISED IN BOTH THE APPEALS IS AS TO WHETHER THE INCOME /LOSS FROM LETTING OUT OF MULTIPLEX/SHOPPING MALL AND CINEMA THEATRE ALONG WITH AMENITIES IS TO BE ASSESSED UNDER HEAD INCOME FROM HOUSE PROPERTY OR AS BUSIN ESS INCOME OF THE ASSESSEE . THE ASSESSEE IS A PARTNERSHIP FIRM (WRONGLY WRITTEN BY THE AO AS COMPANY) ENGAGED INTO THE BUSINESS OF CONSTRUCTION AND MAINTENANCE OF MALL, LETTING OUT PREMISES ON LEASE AND PROVIDING AMENITIES THEREIN AND EXHIBITION OF FE ATURE FILMS AT MULTIPLEX. THE ASSESSEE CONSTRUCTED A MULTIPLEX COMPLEX IN BHAYANDER (WEST) COMPRISING OF MULTIPLEX THEATRES, SHOPS, ENTERTAINMENT AND GAME ZONE, KIOSK, FOOD COURT, ETC. WHICH WAS COMMISSIONED IN THE PREVIOUS YEAR ENDING ON 31.03.2009 RELEVA NT TO THE ASSESSMENT YEAR 2009 - 10. THE ASSESSEE OFFERED INCOME/LOSS FROM THE ABOVE ACTIVITY AS UNDER THE HEAD INCOME FROM BUSINESS OR PROFESSION WHEREAS THE ASSESSING OFFICER TREATED THE SAME AS INCOME FROM HOUSE PROPERTY. THE ABOVE ACTION OF THE AO HA S BEEN FURTHER CONFIRMED BY THE CIT(A). THE ASSESSEE HAS THUS COME IN APPEAL BEFORE US. 3 . THE LD. AR OF THE ASSESSEE, HAS BROUGHT OUR ATTENTION TO THE WRITTEN SUBMISSIONS FILED BEFORE THE LD. CIT(A) WHEREIN IT HAS BEEN EXPLAINED THAT THAT THE A SSESSEE I S OPERATING MULTIPLEX WITH 6 SCREENS AND PARKING FACILITIES AND BALANCE AREA IS GIVEN ON RENT WHEREIN FOOD COURT AND SHOPS ARE LOCATED. HE HAS BEEN FURTHER EXPLAINED THAT SINCE, ON THE FILMS EXHIBITED IN THE MULTIPLEX SCREENS, ENTERTAINMENT TAX IS EXEMPTE D FOR A PERIOD OF 5 YEARS FROM THE DATE OF COMMENCEMENT, THE COMPLEX IS REQUIRED TO COMPLY WITH CERTAIN REQUIREMENTS WITH RE GARD TO FACILITIES THAT ARE MAN DATORILY TO BE PROVIDED AND THE ENTIRE ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 3 COMPLEX IS PROVIDED WITH AMENITIES SUCH AS OPEN AREA AS PER MU NICIPAL REGULATIONS, ESCALATORS, AIR - CONDITIONING FACILITIES, INTERIORS AND ELECTRICAL FITTINGS AS PER THE SPECIFICATIONS OF THE OCCUPANTS, UNINTERRUPTED POWER SUPPLY AND SECURITY AR RA NGEMENTS, WHICH INCLUDES CLOSED CIRCUIT TV MONITORING'(CCT'). IT HAS BEE N THUS SUBMITTED THAT A SSESSEES PRIME MOTIVE IN EMBARKING ON THIS PROJECT WAS NOT JUST TO GIVE PROPERTY ON RENT BUT TO EXPLOIT THE SAME AS A COMMERCIAL VENTURE WITH BUSINESS MOTIVE AND HENCE ATTACHED A LOT OF IMPORTANCE IN CONCENTRATING MORE ON PROVIDING ADDED AMENITIES WITH TOUCH OF WORLD CLASS FACILITIES ADDED TO THE VENTURE WHICH WILL BE EVIDENT FROM THE AMOUNT OF INVESTMENTS MADE IN CONSTRUCTION AND ASSEMBLY OF AMENITIES THAT WERE TO BE MADE AVAILABLE TO TENANTS. THE FOLLOWING AMOUNTS WERE INCURRED TOW ARDS CAPITAL COST FOR PROVIDING VARIOUS AMENITIES: AIR - CONDITIONERS RS.3,54,40,455 ELECTRICAL FITTINGS RS.6,38,53,663/ - ESCALATOR RS.1,38,93,405/ - SPECIAL TILING RS.1,09,81,232/ - HARDWARE MATERIALS RS. 64,75,106/ - -------------- ------ -- RS.13,06,43,861/ - ============ THE ASSESSEE HAS FURTHER EXPLAINED THAT BESIDES THE ABOVE, SUBSTANTIAL PORTION OF IRON AND STEEL COST , CEMENT COST AND LABOUR COST INCURRED ON THE BUILDING CONSTRUCTION IS ATTRIBUTABLE TO THE AMENITIES PROV IDED TO TENANTS. IT HAS BEEN EXPLAINED THAT SUBSTANTIAL INCOME HAS BEEN RECEIVED FROM THE LETTING OF PREMISES/SHOPS IN THE MALL TO THE TENANTS AND FOR AMENITIES PROVIDED TO THEM. DURING THE PREVIOUS YEAR ENDED 31.03.2009, THE ASSESSEE HAD THE FOLLOWING GR OSS RECEIPTS: RS. RS. RS. LEAVE AND LICENSE FEES RECEIVED 1,44,87,021 COMPENSATION FOR AMENITIES PROVIDED 1,78,07,853 ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 4 CHARGES RECOVERED TOWARDS COMMON AREA MAINTENANCE 1,13,53,129 GODOWN RENT 2,78,000 RENTAL FROM KIOSK 9,28,700 COMPEN SATION FOR USE OF ANTENNA 15,00,396 4,63,55,104 ADVERTISING BILL RECEIVABLE 28,21,768 CORPORATE MEMBERSHIP 31,000 GENERAL MEMBERSHIP 31,000 NET COLLECTIONS 3,63,11,865 TDO CARDS 1,50,000 THEATRE MAINTENANCE CHARGES 27,42,820 DIS COUNT 1,871 8,84,45,428 THE ASSESSEES STA ND HAS BEEN THAT WITH REGARD TO THE ENTIRE INCOME FROM THE COMPLEX, THE SAME SHOULD BE ASSESSED UNDER THE HEAD 'BUSINESS' SINCE AS THE OBJECT BEHIND PURSUING THE ACTIVITY IN THE COMPLEX WAS WITH THE VI EW TO CARRY ON BUSINESS ACTIVITY AND COMMERCIALLY EXPLOIT FIXED ASSETS DEPLOYED THEREIN . T HE ASSESSEE ALSO RELIED UPON THE FOLLOWING JUDICIAL DECISIONS BEFORE THE LD. CIT(A) : (I) D CI T VS. MANMIT ARCADE (P) LTD. *HONBLE ITAT, BANGALORE+ 93 TTJ 463) (II) SRI BALAJI ENTERPRISES VS. CIT (1997) 140 CTR (KAR) 61 (III) CIT VS. BHOOPALAN COMMERCIAL COMMERCIAL COMPLEX & INDUSTRIES (P) LTD. (2003) 183 CTR (KAR.) 275 (IV) S.G. MERCANTILE CORPN. (P) LTD. VS. CIT 1972 CTR (SC) 8 (V) PFH MALL & RETAIL MANAGEMENT LTD. VS. ITO, WARD 8(3), KOLKATA (112 TTJ 523) (HONBLE ITAT, KOLKATA) (VI) ITO, WARD 19(3)(4), MUMBAI VS. SHANAYA ENTERPRISES IN ITA NO . 3648/M/2010 DATED 30.06.2011 (HON'BTE ITAT, MUMBAI) (VII) MUKHERJEE ESTATES (P) LTD. VS. CIT (244 ITR 1) (VIII) DCIT, CIRCLE - 3, PUNE VS. MAGARPATTA TOWNSHIP DEVELOPMENT & CONSTRUCTION CO. IN ITA NO.822/PN/2011 AND C.O.NO.04/PN/2012 DATED 18.09.2012 (HON'BLE LTAT PUNE) (IX) CIT VS. RUNWAL DEVELOPERS PVT. LTD. (BOMBAY HIGH COURT) (ITA NO.4984, 4240 & 4241 OF 2010) (X) ACIT VS. SA PTARSHI SERVICES LTD. (265 ITR 379) (GUJ) (XI) CIT VS. MOHIDDIN HOTELS (P) LID. & ANR. (284 ITR 229) (BORN.) ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 5 4 . THE LD. CIT(A) , HOWEVER , HAS OBSERVED IN THE IMPUGNED ORDER THAT THE AMENITIES PROVIDED BY THE ASSESSEE IN THE MULTIPLES WERE THE NORMAL FACIL ITIES THAT WERE REQUIRED TO BE PROVIDED IN THE BUILDING TO MAKE IT FIT FOR OCCUPATION BY THE TENANT. HE HAS FURTHER OPINED THAT CERTAIN OTHER PROVISIONS/FACILITIES VIZ . PROVIS I ON FOR F IRE FIGHTING EQUIPMENTS, SPRINKLERS, HYDRANTS, ELEVATORS ETC. HAVE BEEN P ROVIDED AS REQUIRED UNDER RULES AND REGULATIONS OF THE LOCAL AUTHORITY/MUNICIPAL AUTHORITY. HE HAS FURTHER OBSERVED THAT EVEN IF CERTAIN COSMETIC ADDITIONS VIZ. FALSE CEILING OR GLASS FACADE ETC. HAVE BEEN MADE TO THE BUILDING THEY ARE IN THE NATURE OF COS T INCURRED ON THE IMPROVEMENT OF THE BUILDING. THE ALLEGED AMENITIES HA VE NO INDEPENDENT EXISTENCE WITHOUT THE BUILDING WHICH HAS BEEN LET OUT. HE THEREFORE HELD THAT THE PRIMARY PURPOSE OF THE ASSESSEE WAS TO LET OUT THE BUILDING. 5 . WE HAVE HEARD THE RIVAL CONTENTIONS AND HAVE ALSO GONE THROUGH THE RECORDS. THE ASSESSEE IS A PARTNERSHIP FIRM CONSTITUTED BY THE PARTNERS FOR CARRYING OUT THE BUSINESS ACTIVITY. THE OPENING LINES OF THE PARTNERSHIP DEED , THE COPY OF WHICH HAS BEEN PLACED ON RECORD, REA D AS UNDER: AND WHEREAS THE ABOVEMENTIONED PARTIES HAVE DECIDED TO COMMENCE BUSINESS IN PARTNERSHIP AS CONSTRUCTION OF REAL ESTATE, MULTIPLEX CENTRE, ENTERTAINMENT COMPLEX, COMMERCIAL CENTRE, MARRIAGE HALL, RESTAURANT, BUILDERS AND LAND DEVELOPERS AND OPE RATION AND MANAGEMENT OF MULTIPLEX , RESTAURANT AND MARRIAGE HALL ETC. AND/OR ANY OTHER BUSINESS/BUSINESS MUTUALLY DECIDED FROM TIME TO TIME BETWEEN THE PARTNERS UNDER THE NAME AND STYLE OF M/S. SHREEJI E XHIBITORS WITH ITS PLACE OF BUSINESS AT OLD S. NO .677 (7A), NEW S.NO.277, NEAR TI MBA HOSPITAL, FATAK ROAD, BHAYANDER (WEST), DIST. THANE.401 101. (EMPHASIS SUPPLIED) FURTHER THE BUSINESS ACTIVITY OF THE ASSESSEE HAS ALSO BEEN EXPLA INED UNDER CLAUSE 3 OF THE DEED, WHICH READ AS UNDER: 3. NATURE OF BUSINE SS : THE BUSINESS OF THE PARTNERSHIP SHALL BE THAT OF CONSTRUCTION OF REAL ESTATE, MULTIPLEX CENTER, ENTERTAINMENT COMPLEX, COMMERCIAL CENTER, M ARRIAGE HALL, ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 6 RESTAURANT, BUILDERS AND LAND DEVELOPERS AND OPERATION AND MANAGEMENT OF MULTIPLEX , RESTAURANT AND MARRIAGE HALL ETC. AND/OR ANY OTHER BUSINESS/BUSINESS MUTUALLY DECIDED FROM TIME TO TIME BETWEEN THE PARTNERS . 6 . A PERUSAL OF THE ABOVE REVEALS THAT NOT ONLY THE VERY PURPOSE OF F ORMATION OF THE ASSESSEE FIRM BUT ALSO ITS OBJECTS SPECIFICALLY INCLUDE T HE CONSTRUCTION OF MULTIPLEX CENTER, ENTERTAINMENT COMPLEX, COMMERCIAL CENTER AND THEIR OPERATION AND MANAGEMENT. 7 . THE OTHERWISE UNDISPUTED FACTS OF THE CASE ARE THAT THE ASSESSEE ALONG WITH LEASING OF THE PREMISES IS ALSO EARNING SUBSTANTIAL INCOME FR OM PROVIDING AMENITIES AND FACILITIES. SUCH FACILITIES ARE NOT THE BASIC FACILITIES REQUIRED FOR OCCUPATION OR RENTING OF A BUILDING OR PREMISES, BUT THESE ARE THE SPECIAL FACILITIES FOR RUNNING OF THE MULTIPLEX/ SHOPPING MALL AND CINEMA THEATRE AND FOOD C OURT ETC. AND ARE MEANT TO ATTRACT THE CUSTOMERS AND PROVIDE COMFORT OF SHOPPING TO THEM . THESE FACILITIES CAN NOT BE SAID TO BE BASIC/NORMAL FACILITIES REQUIRED FOR OCCUPATION OF THE PREMISES. THE COST OF COMMON FACILITIES HAS BEEN EMBEDDED IN THE LEASE R ENTALS WHEREAS THE ASSESSEE IS ALSO RECEIVING SUBSTANTIAL INCOME FOR PROVIDING AMENITIES/FACILITIES TO THE OCCUPANTS/ TENANTS . THE ASSESSEES ACTIVITY THUS CAN NOT BE SAID TO BE MERE LETTING OF THE BUILDING OWNED BY IT BUT ITS ACTIVITY IS A BUSINESS ACTIVIT Y OF CONSTRUCTION OF MALL, MAINTAINING IT, LEASING THE SHOPS/ AREA FOR THE PURPOSE OF COMMERCIAL EXPLOITATION OF THE ASSET, ARRANGE AND PROVIDE THE FACILI TIES AND AMENITIES NOT ONLY TO THE OCCUPANTS/LESSEES BUT ALSO TO PROVIDE AND MAINTAIN FACILITIES AND A MENITIES IN THE COMMON AREAS FOR THE ATTRACTION, CONVE NIENCE AND COMFORT OF THE CUSTOMERS/VISITORS. IN OUR VIEW, AS PER THE MODERN DAY TRENDS OF RETAIL BUSINESS AND CU S TOMER PREFERENCES , NOT ONLY THE QUANTUM OF RENT/INCOME FROM THE MULTIPLEX BUT ALSO THE VERY LETTING OF THE PREMISES DEPENDS UPON THE PROVISIONS OF FACILITIES AND ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 7 AMENITIES PROVIDED TAKING INTO CONSIDERATION NOT ONLY THE NEED AND REQUIREMENTS OF THE BUSINESS ENTITIES/OCCUPANTS BUT ALSO THE COMFORT ZONE OF THE CUSTOMERS/VISITORS. THE ACTIVITY OF CONSTRUCTION OF MULTIPLEX AND CINEMA THEATRE, ITS MAINTENANCE AND PROVIDING AMENITIES AND FACILITIES THEREIN, THUS CAN NOT BE SAID TO BE MERE LETTING OUT OF THE PROPERTY BUT IN OUR VIEW IS A COMPOSITE BUSINESS ACTIVITY. MERELY BECAUSE INCOME IS ATTACHE D TO A PROPERTY IT CANNOT BE A SOLE FACTOR FOR ASSESSING SUCH INCOME AS INCOME FROM HOUSE PROPERTY AND IT HAS TO BE SEEN THAT WHETHER IT WAS THE PRIMARY OBJECTIVE OF THE ASSESSEE TO EXPLOIT THE PROPERTY IN A SIMPLE MANNER OR TO EXPLOIT IT COMMERCIALLY I.E. TO EXPLOIT IT BY WAY OF COMPLEX COMMERCIAL ACTIVITIES TO ARRIVE AT THE GENERATION OF INCOME THAT COULD BE TAXED UNDER THE HEAD INCOME FROM HOUSE PROPERTY OR AS INCOME FROM BUSINESS. IF IT IS FOUND THAT MAIN INTENTION IS TO SIMPLY LET OUT PROPERTY OR ANY P ART OF IT, RESULTANT INCOME MUST BE ASSESSED AS INCOME FROM HOUSE PROPERTY BUT IF MAIN INTENTION IS FOUND TO BE EXPLOITATION OF PROPERTY BY WAY OF COMMERCIAL ACTIVITIES, THEN RESULTANT INCOME MUST BE HELD AS BUSINESS INCOME. 8 . THE HON'BLE SUPREME COURT I N THE CASE OF KARNANI PROPERTIES LTD. V. CIT [1971] 82 ITR 547 HAS LAID DOWN THE PRECISE TESTS THAT ARE NECESSARY TO DETERMINE WHETHER THE SERVICES RENDERED BY AN ASSESSEE TO ITS TENANTS/RECIPIENTS OF SERVICE, ARE IN THE NATURE OF BUSINESS ACTIVITIES AND I NCOME GENERATED THEREFROM ASSESSABLE AS BUSINESS INCOME, OR NOT. THE HON'BLE SUPREME COURT HAS EXPRESSED THE VIEW THAT IF THE SERVICES RENDERED BY THE ASSESSEE ARE THE RESULTS OF ITS ACTIVITIES CARRIED ON CONTINUOUSLY IN AN ORGANIZED MANNER, WITH A SET PUR POSE AND WITH A VIEW TO EARN PROFITS, THOSE ACTIVITIES WOULD CONSTITUTE BUSINESS ACTIVITIES AND THE INCOME ARISING THEREFROM WOULD BE ASSESSABLE AS BUSINESS INCOME UNDER SECTION 28 OF THE ACT. ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 8 T HE ACTIVITIES OF THE ASSESSEE IN THIS CASE IN PROVIDING THE V ARIOUS SERVICES/FACILITIES/AMENITIES MEET ALL THE AFORESAID FOUR REQUIREMENTS LAID DOWN BY HON'BLE SUPREME COURT TO QUALIFY AS BUSINESS ACTIVITIES. 9 . IN A VERY RECENT JUDG MENT, THE HON'BLE SUPREME COURT IN THE CASE OF CHENNAI PROPERTIES & INVESTMENT L TD. [2015] 373 ITR 673(SC) HAS NOTED THAT IN ITS (SUPREME COURT) EARLIER JUDGMENT IN THE CASE OF KARANPURA DEVELOPMENT CO. LTD. VS. CIT 44 ITR 362 (SC), THE POSITION OF LAW ON THIS ISSUE HAS BEEN SUMMED UP IN THE FOLLOWING WORDS: - 'AS HAS BEEN ALREAD Y POINTED OUT IN CONNECTION WITH THE OTHER TWO CASES WHERE THERE IS A LETTING OUT OF PREMISES AND COLLECTION OF RENTS THE ASSESSMENT ON PROPERTY BASIS MAY BE CORRECT BUT NOT SO, WHERE THE LETTING OR SUB - LETTING IS PART OF A TRADING OPERATION. THE DIVING LINE IS DIFFICULT TO FIND; BUT IN THE CASE OF A COMPANY WITH ITS PROFESSED OBJECTS AND THE MANNER OF ITS ACTIVITIES AND THE NATURE OF ITS DEALINGS WITH ITS PROPERTY, IT IS POSSIBLE TO SAY ON WHICH SIDE THE OPERATIONS FALL AND TO WHAT HEAD THE INCOME IS TO BE ASSIGNED.' THE HON'BLE SUPREME COURT THUS HAS EMPHASIZED THE PROFESSED OBJECTS AND THE MANNER OF ACTIVITIES CARRIED OUT BY AN ASSESSEE. IT HAS ALSO BEEN POINTED OUT THAT THE NATURE OF DEALINGS WITH THE PROPERTY WOULD ALSO BE FACTOR TO DETERMINE WHETHER THE ACTIVITIES FALL FOR CONSIDERATION UNDER THE HEAD `'BUSINESS INCOME'' OR 'HOUSE PROPERTY INCOME'. THE HONBLE SUPREME COURT THUS NOTICED THE AFORESAID PRINCIPLE AND APPLIED THE SAME TO THE FACT S OF THE CASE BEFORE IT. THE FACTS OF THE CASE BEFORE THE H ONBLE SUPREME COURT WERE THAT AS PER THE MEMORANDUM OF ASSOCIATION , THE MAIN OBJECTS OF THE APPELLANT COMPANY WAS TO ACQUIRE AND HOLD THE PROPERTIES KNOWN AS CHENNAI HOUSE AND FIRHAVIN ESTATE BOTH IN CHENNAI AND TO LET OUT THOSE PROPERTIES AS WELL AS MAKE ADVANCES UPON THE SECURITY OF LANDS AND BUILDINGS OR OTHER PROPERTIES OR ANY INTEREST THEREIN. I N THE RETURN THAT WAS FILED, THE ENTIRE INCOME WHICH ACCRUED AND WAS ASSESSED IN THE SAID RE TURN WAS FROM LETTING OUT OF THO SE PROPERTIES . THE HONBLE SUPR EME COURT WHILE RELYING UPON ITS THE VARIOUS OTHER DECISIONS ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 9 HELD THAT IN SUCH A CASE THE IRRESISTIBLE CONCLUSION WOULD BE THAT THE LETTING OF THE PROPERTIES WAS IN FACT THE BUSINESS OF THE ASSESSEE AND THE INCOME ARISING THEREFROM WAS TO BE TREATED UNDER THE HEAD INCOME FROM BUSINESS AND THAT IT CANNOT BE TREATED AS INCOME FROM HOUSE PROPERTY. WHAT THE HONBLE SUPREME COURT EMPHASISE D UPON WAS THAT THE HOLDING THE AFORESAID PROPERTIES AND EARNING INCOME BY LETTING OUT THOSE PROPERTIES WAS THE MAIN OBJECT IVE OF THE COMPANY. THE FACTS OF THE CASE OF THE ASSESSEE BEFORE US ARE ON BETTER FOOTING S . THE ASSESSEE S OBJECT S ARE NOT IN RESPECT OF LETTING OF ANY PARTICULAR PROPERTY, BUT IT HAS THE MAIN OBJECTS OF ACQUIRING, CONSTRUCTING, OPERATING AND MAINTAINING OF THE MULTIPLEXES, BUSINESS CENTER , MARRIAGE HALL S ETC. THE VERY OBJECT IS THE COMMERCIALLY EXPLOITATION OF THE PROPERTIES. BESIDES THAT THE ASSESSEE IS ALSO PROVIDING HOSTS OF AMENITIES AND FACILITIES , AS DISCUSSED ABOVE, WHICH AMOUNTS TO COMPOSITE BUS INESS ACTIVITY. THUS THE ISSUE IS SQU A RELY COVERED IN FAVOUR OF THE ASSESSEE BY THE ABOVE NOTED DECISIONS OF THE HONBLE SUPREME COURT. WE THEREFORE HOLD THAT THE INCOME/LOSS FROM THE MULTIPLEX IS LIABLE TO BE ASSESSED AS BUSINESS INCOME/LOSS AND NOT A S INCOME FROM HOUSE PROPERTY. THE ASSESSEE CONSEQUENTLY IS ALSO ENTITLED TO THE CLAIM OF DEDUCTIONS IN RESPECT OF EXPENDITURE INCURRED AND DEPRECIATION ON ASSETS ETC. IN RELATION TO SUCH INCOME. ITA NO.2196/M/2013 10. SINCE THE FACTS AND ISSUES INVOLVED IN THIS APPEAL ARE EXACTLY IDENTICAL EXCEPT THE FIGURES OF THE AMOUNTS INVOLVED, HENCE, IN VIEW OF OUR OBSERVATIONS MADE ABOVE, THIS APPEAL OF THE ASSESSEE IS ALSO ALLOWED IN TERMS AS NOTED ABOVE. ITA NO.640/M/2014 & ITA NO.2196/M/2013 M/S. SHREEJI EXHIBITORS & M/S. SHREEJI ENTERPRISES 10 11. IN THE RESULT, BOTH THE APPEALS ARE HEREBY ALLOWED. O RDER PRONOUNCED IN THE OPEN COURT ON 14.08.2015 . SD / SD/ ( R.C. SHARMA ) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 14.08.2015 * KISHORE , SR. P.S. COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT ( A) CONCERNED, MUMBAI THE DR CONCERNED BENCH //TRUE COPY// [ BY ORDER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.