Appeals by Revenue partly allowed, grounds dismissed/allowed based on consistent rulings, Supreme Court decision. Assessee's cross objections dismissed.

The appeals filed by the Revenue were partly allowed, with specific grounds being dismissed or allowed based on consistent rulings and the Supreme Court's decision. The cross objections by the assessee were dismissed as not pressed. The order was pronounced in the open court on 04/10/2017.

---

---

Issues Involved:
1. Status of the assessee as an individual or HUF.
2. Exemption under Section 10(19A) on rental income from Ummed Bhawan Palace.
3. Classification of receipts from ITC Ltd. as business income or income from other sources.
4. Classification of interest on FDRs as business income or income from other sources.
5. Classification of income from Sarovar Complex as business income or income from house property.
6. Disallowance of business expenses.
7. Deduction for Senior Citizen quantum of exemption.

Detailed Analysis:

1. Status of the Assessee:
The CIT(A) held that the assessee should be deemed an individual owner of all properties comprised in the estate, following the decision of the ITAT Jaipur and earlier orders. This ground was consistently decided in favor of the assessee in previous years, and thus, the appeal on this ground was dismissed.

2. Exemption under Section 10(19A):
The CIT(A) allowed the exemption under Section 10(19A) for the rental income received from Ummed Bhawan Palace, including the rental income from land and structures requisitioned by the defense department. This decision was based on the Supreme Court's ruling, which confirmed that the entire rental income from the palace is exempt from income tax. Consequently, the addition of accrued income was not sustained, and this ground of appeal was allowed in favor of the assessee.

3. Classification of Receipts from ITC Ltd.:
The CIT(A) held that receipts from ITC Ltd. should be classified as business income under Section 28 of the I.T. Act, 1961, rather than as income from other sources. This decision followed the consistent rulings of the ITAT in earlier years, which treated such receipts as business income. The appeal on this ground was dismissed.

4. Classification of Interest on FDRs:
The CIT(A) determined that the net interest income from bank deposits should be assessed as business income, not income from other sources. This decision was consistent with the ITAT's rulings in previous years. However, the Coordinate Bench had earlier decided that such interest income should be treated as income from other sources, leading to the appeal on this ground being allowed.

5. Classification of Income from Sarovar Complex:
The CIT(A) ruled that income from the commercial property (Sarovar Complex) should be assessed as business income, not as income from house property. This decision followed the consistent rulings of the ITAT in earlier years. The appeal on this ground was dismissed.

6. Disallowance of Business Expenses:
The CIT(A) restricted the disallowance of business expenses to 20% of the total claimed expenses, which amounted to Rs. 7,12,020/-. The balance disallowance was directed to be deleted, following the ITAT's rulings in earlier years. This ground of appeal was partly allowed.

7. Deduction for Senior Citizen Quantum of Exemption:
The CIT(A) upheld the AO's decision not to allow the deduction for Senior Citizen quantum of exemption under Section 88B of the I.T. Act, 1961. The appeal on this ground was dismissed.

Cross Objections by the Assessee:
The assessee's cross objections regarding the exemption under Section 10(19A) and the Senior Citizen quantum of exemption were not pressed, following the Supreme Court's decision. Consequently, the cross objections were dismissed as not pressed.

Conclusion:
The appeals filed by the Revenue were partly allowed, with specific grounds being dismissed or allowed based on consistent rulings and the Supreme Court's decision. The cross objections by the assessee were dismissed as not pressed. The order was pronounced in the open court on 04/10/2017.

---