TaxTMI 
TaxTMI 
2010 (4) TMI 712
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....llowing depreciation does not arise. 3. The next common ground in appeal Nos. in ITA No.6, 69 and 7 /Hyd/2010 are that the CIT(A) erred in considering the fact that the real consideration received by the assessee in lieu of the land forgone by him is the superstructure and therefore the same should be considered as sale consideration instead of the market value of the land. 4. In this case, the brief facts of the case are that the assessee filed return of income along with her son and daughter owned land situated at Survey No.12 of Kondapur Village, Hyderabad. The said land was given to M/s SDE engineers Ltd., on development basis. Accordingly, the assessee along with her son and daughter were all allocated an area of 99,702 sq. ft in the super structure constructed on the said land by the developer. All these three persons put together purchased from the developer an area of 7,328 sq. ft in order to becomethe owners of first, second, sixth and eighth floors of the super structure which was subsequently named as "SDE Prameela Techno park'. The said building was leased out to M/s Satyam Services Ltd. by the assessee along with her son and daughter. Since Satyam Computer Servic....
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....egarding the 'Head of income'. The assessee entered into two agreements one for rental income, and the other for amenities provided. The tenant deducted taxtreating the whole amount as rental income and TDS u/s 194 of the IT Act. According to the assessee, the rent on building is to be computed 'income from house property'. On the other hand, hire charges collected on amenities provided to be treated as 'income from business'. Accordingly, the assessing officer treated the entire income from letting as 'income from house properties'. On appeal. the CIT(A) directed the assessing officer to split and treat the hire charges into two, as one is 'income from house property' and the other 'income from other sources'. Against this the Revenue is in appeal before us. 5. The main contention of the departmental representative is that all amenities are integral part of the buildings. Because there is separate agreement, it does not lead to the conclusion that it is to be assessed separately as income from business and he relied on the order in the case of Sultan Brothers (P) Ltd. Vs. CIT, Bombay City II (51 ITR 353) (SC). 6. The AR submitted that the rental income received from the lett....
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....nts. He relied on the order in the case of Attukal Shopping Complex (P) Ltd. Vs. CIT (259 ITR 567) (Ker.) wherein it was held: The income from the building formed part of the business and property. Therefore the income of the assessee had to be divided equally as income from property and income from business for the assessment years 1993-94, 1994-95 and 1995-96.' 8. We have heard both the parties and perused the material available on record. After, going through the facts of the case, we are of the opinion that most of the items listed above are common in nature which are to be provided to software companies to carry out their day to day works by the landlord, without these they cannot function. Keeping in view the nature of activities of the tenant, the amenities are provided by the assessee to exploit the property in most profitable manner. In the present case, the assessee made separate lease agreements in order to help the assessee in tax planning only, the lease from the lessees point of view is only for the property as a whole. This is evident from the following (a) the TDS certificates clearly show that the entire payments made by Satyam Computers is towards rent - ....
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.... of the property to be the sum for which the property might reasonably be expected to be let from year to year. Clause (b) deems the actual rent received or receivable by the owner to be the annual value if that sum is in excess of the sum referred to in clause (a). Explanation (1) Sec.23 defines 'annual rent' for the purpose of that sub section. The explanation reads as under: Explanation 1: For the purposes of this sub section 'annual rent' means: a) in a case where the property is let throughout the previous year, the actual rent received or receivable by the owner in respect of such year and b) in any other case, the amount which bears the same proportion to the amount of the actual rent received or receivable by the owner for the period for which the property is let, as the period of twelve months bears no such period. 9. The annual rent in a case when the property is let through out the year is the actual rent received or receivable by the owner. When the amount of the actual rent received or receivable by the owner, is known that would constitute the basis for determining the annual value and it is that value which will have to form the basis for determining the ....
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....I appearing elsewhere in the order, within the ambit of the word 'plant'. It is not possible to give such a wide construction as suggested by the learned counsel for the asessee. In the case of Sultan Brothers Pvt.Ltd. v. CIT 51 ITR 353 (SC) what was let out to the tenant was a building fitted up with the furniture and fixtures, for being run as a hotel. Therefore, the Supreme Court held that since the building was let along with the furniture and fixtures, the provisions of sec.56(2) (iii) would be applicable and the income from building should be assessed under the head 'other sources'. But according to the fact arising in the present case, plant and machinery or furniture was not hired by the assessee along with the building. Therefore, the decision of the apex court in Sultan Bros case supra, will not be applicable to the facts of the present case. Thus, on a plain reading of sec.56(2) (iii) of the Act, in the light of the facts of the case, we hold that conclusion reached by the CIT(A) is not correct. Further, no precise test can be laid out to ascertain whether income referred to by whatever nomenclature, lease amount, rent or licence fee received by an assessee from leasing ....
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....h enables the developer to enjoy 60% of the undivided share of land. In our considered opinion, this decision will not come to the rescue of the asessee. In our opinion, the consideration for the transfer of capital asset is what the transferer receives in lieu of the assets he parts with and therefore the very asset transferred or parted with and full value of consideration cannot be construed as having a reference to the market value of asset transferred and the said expression only means that full value of the asset received by the transferer in exchange for the capital asset transferred by him. Since the development agreement specifiesthat certain part of constructed area shall be surrendered to the owner by the builder on the completion of the contract and the value of the constructed area to be transferred to the assessee to be considered as consideration received and as such full value of consideration in the case of not by applying the ratio of the order of the Delhi Bench of the Tribunal in the case of M/s Vasavi Pratap Chand Vs. DCIT (89 ITD 73) (Del.) is the only the cost of construction of proposed building to the extent of which were falls to the assessee in the ....