ITAT Chennai rules in favor of assessee on industrial park income classification

The ITAT Chennai allowed the appeal of the assessee against the order of the CIT(Appeals) regarding the classification of income from an Industrial Park. The ITAT Chennai determined that the income should be assessed under the head 'Income from Business' based on the judgment of the Hon'ble Madras High Court and the approval granted to the assessee for operating the industrial park. The decision was pronounced on 13th September 2013 in Chennai.

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Issues involved: Determination of whether income from an Industrial Park should be assessed under 'Income from House Property' or 'Income from Business'.

Summary:
The appeal was filed by the assessee against the order of the Commissioner of Income Tax(Appeals)-V, Chennai, for the Assessment Year 2009-10. The only issue raised was the classification of income from the Industrial Park. The Assessing Officer initially assessed the rental income under 'Income from House Property', leading to additions/disallowances in the income. The CIT(Appeals) upheld this decision, prompting the assessee to appeal to the ITAT Chennai.

The assessee argued that similar issues had been decided in their favor by the Hon'ble Madras High Court in previous years. The High Court had ruled that income from letting out an IT Park should be assessed under 'Income from Business'. The ITAT Chennai, after considering the High Court's judgment and the approval granted to the assessee for setting up an industrial park, concluded that the assessee was entitled to claim deduction u/s. 80IA and that the income should be assessed under the head 'Income from Business'. Therefore, the appeal of the assessee was allowed.

Judgment by ITAT Chennai:
The ITAT Chennai, comprising of Shri N.S. Saini, Accountant Member, and Shri Vikas Awasthy, Judicial Member, allowed the appeal of the assessee against the order of the CIT(Appeals) regarding the classification of income from an Industrial Park. The ITAT Chennai relied on the judgment of the Hon'ble Madras High Court and the approval granted to the assessee for operating an industrial park to determine that the income should be assessed under the head 'Income from Business'. The decision was pronounced on 13th September 2013 in Chennai.

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