2011 (10) TMI 35

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....e assessee were liable to be assessed as 'business income' instead of 'income received from house property', as held by the assessing officer.   3. The assessment years involved herein are AY 2004-05, 2005-06 and 2006-07.   4. The assessee is in the business of building and developing residential and commercial complexes. The assessee is also running a Mall under the name 'R Mall' situate at Mulund, Mumbai.   5. The assessee had constructed an area of nearly 2,68,000 sq. ft. at Mulund, out of which an area admeasuring 60,000 sq. ft. has been sold on outright basis to various parties. The assessee has given major portion of the remaining area i.e. about 1.9 lac. sq. ft. on lease to various persons who are running shop....

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....ises on lease.   7. Being aggrieved by the aforesaid order, the revenue filed appeals before the ITAT and the ITAT upheld the order passed by the CIT(A) and dismissed the appeal filed by the revenue. The ITAT followed the judgment of the Kolkata 'A' Bench in the case if PFH Mall and Retail Management Ltd. V/s. ITO reported in (2007) 523 TTJ 112 (Kol) wherein it is held that where the main intention is simply letting out of property, the resultant income must be assessed as income from house property and if on the other hand, the main intention is found to be the exploitation of the immovable property by way of commercial activities, then the resultant income must be held to be business income. Challenging the aforesaid order, the pr....

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....ered from the persons to whom the premises were given on outright sale basis. Therefore, the Tribunal was justified in holding that the maintenance charges received were towards the maintenance and promotion of the common area and the amounts received towards maintenance charges were business receipts liable to be assessed under the head "income from business'.   10. Moreover, perusal of clause (6) in the business conducting agreement clearly shows that the maintenance charges collected by the assessee not only relates to the open area/common area, repair and maintenance of equipment, land, atrium, fire fighting equipments, transformers, air conditioner plants, water tank and other services in the common areas of the complex, but al....