PR. COMMISSIONER INCOME TAX -6 V. M/S SILVER SOFTWARE PVT.LTD.,

ITA/679/2015

AI Insights

The case involves an appeal by the Revenue against the decision of the Income Tax Appellate Tribunal (ITAT), which had held that the income of the assessee, M/s. Silver Software Pvt. Ltd., was business income rather than income from house property. The Revenue contended that the income should be assessed under the head 'Income from house property' as per the agreements of lease where the building was let out on a square feet basis. The Tribunal's decision was based on a precedent set in a similar case, DCIT vs. Velankani Information Systems Pvt. Ltd., which had been upheld by the High Court. The Revenue's appeal to the High Court in this precedent case was dismissed, and the matter is currently pending before the Apex Court.

• Counselvise Citation: [2016] 140 COUNSELVISE.COM (IT) 733310 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 29-03-2016
• Assessment Year: misc
• Other Referred Cases: DCIT \\u2013vs- Velankani Information Systems Pvt. Ltd.
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Assessee Lawyers: E I SANMATHI
• Keywords: Assessment Year 2011-12; Business income; Income from house property
• Section: 260-A

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29TH DAY OF MARCH, 2016 PRESENT THE HON'BLE MR. JUSTICE JAYANT PATEL AND THE HON’BLE MRS. JUSTICE B.V.NAGARATHNA ITA NO.679/2015 BETWEEN 1. PR. COMMISSIONER OF INCOME TAX - 6, CENTRAL REVENUE BUILDINGS, QUEENS ROAD, BANGALORE – 560 001. 2. THE DY. COMMISSIONER OF INCOME TAX , CENTRAL CIRCLE 12(3), BANGALORE. ... APPELLANTS (By SRI. E. I. SANMATHI, ADV.) AND M/S. SILVER SOFTWARE PVT. LTD., NO.23 AND 24, EPIP, I PHASE, KIADB WHITEFIELD, BANGALORE-560 066, PAN: AADC6245H. ... RESPONDENT THIS ITA IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, PRAYING TO SET ASIDE THE COMMON APPELLATE ORDER DATED 29/05/2015 PASSED BY THE ITAT, 'B' BENCH, BENGALURU IN APPEAL PROCEEDINGS ITA NO. 1643/BANG/2014 FOR ASSESSMENT YEAR 2011-12. THIS ITA COMING ON FOR ORDERS THIS DAY, JAYANT PATEL J. DELIVERED THE FOLLOWING: 2 JUDGMENT It appears that the correct date of the order of assessment is 04.03.2014 whereas in the order of CIT (Appeals) it is wrongly typed as 04.03.2013. Hence, the office objection is dispensed with. 2. Learned counsel for the appellants has submitted that the matter is covered by the decision of this Court. Hence, we find it appropriate to take up the main appeal itself for further consideration. 3. The appellants-Revenue have preferred the present appeal by raising the following substantial questions of law: “1. Whether on the facts and in the circumstances of the case, the tribunal is justified in law in holding that income of the assessee is business income even when assessing authority had rightly held that income falls under the head “Income from house property” considering the provisions of the Act and materials on record? 2. Whether the Tribunal’s order can be said as perverse in nature since Tribunal has failed to 3 consider the intention of the assessee in entering into agreements of lease whereby the building has been let out on square feet basis which means that the rent is basically earned for the super structure and such rent has been rightly assessed as house property income”? 4. We have heard Mr.E.I.Sanmathi, learned counsel for the appellants-Revenue. 5. Learned counsel for the appellant-Revenue fairly concedes that in the impugned order, the Tribunal has relied upon its earlier decision in the case of DCIT –vs- Velankani Information Systems Pvt. Ltd. in ITA Nos.1507- 1510/Bang/2010 dated 30.03.2012. Against which, the appellants-Revenue had preferred an appeal before this Court in ITA No.273/2012 and allied matters and this Court vide its order dated 02.04.2013 has dismissed the appeal. He submits that the matter is carried by the appellants- Revenue before the Apex Court and the Special Leave Petition (SLP) is pending. 4 6. In view of the decision of this Court in ITA No.273/2012 and allied matters dated 02.04.2013 operating as on today, it cannot be said that any substantial question of law would arise for consideration as sought to be canvassed. However, in the event the Apex Court takes a different view, the Revenue may take appropriate proceedings in accordance of law. Subject to the aforesaid observations, the present appeal is dismissed. SD/- JUDGE SD/- JUDGE TL "