TaxTMI 
TaxTMI 
2010 (11) TMI 798
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....1255, 1685 and 1756 of 2010 3. Admit on the following substantial questions of law, which arises for consideration in all these cases. "Whether the ITAT has not erred on facts and in law in directing the Assessing Officer not to charge the annual letting value of the West Tower under the head 'income from house property' since the principle of res judicata does not apply in income-tax proceedings?" 4. With the consent of the learned counsel for the parties, we have heard the matter finally at this stage itself. The facts in brief leading to the aforesaid question of law may be recapitulated first. The assessee company is running a five star hotel known as Hotel Le-Meridian Windsor Place, New Delhi. The lawn on ....
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....executed by the assessee with the sub-licensees also permit the sub-licensees to transfer the same to any other person on payment of transfer charges to the assessee company. Thus, the sub-licensee is entitled to transfer the said sub-licence to third party as well. However, at the time of transfer of the said sub-licence, certain transfer charges are payable to the assessee company. It is not in dispute that whenever these transfer charges are received by the assessee on transfer of sub-licence by the sub-licensee in favour of the third party, the assessee is showing these transfer charges as its income and is offering the same for tax. 5. The Assessing Officer (AO) found that almost all the sub-licensees had transferred their su....
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....re, on the principle of consistency, such a move on the part of the AO in fixing the annual letting value of the West Tower, when no actual rent/licence fee was received by the assessee, was not proper. (c) The assessee had entered into sub-licence deeds in respect of those portions and it could not be deemed as 'letting' of the property and for this reason also provisions of section 22 of the Act would not be applicable, as the assessee continued to be in the legal occupation and possession. (d) The use of the premises by the sub-licensees was to assist the assessee company in getting hotel accommodation booked for the guests, delegates of the sub-licensees, apart from the increase in catering and restaurants' activitie....
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.... was not proper. 9. The AO thereafter took into consideration the rent/licence fee, which was paid by the occupiers to the sub-licensees to whom the assessee had sub-licensed the premises. The AO on that basis calculated first care fee average and treated the same as annual letting value of the said West Tower and added the same under the head "income from house property". 10. The assessee preferred appeal against this order before the CIT (A). In this appeal, the assessee took an additional ground predicated on the provisions of section 27(iii) read with section 269 UA (f) (ii) of the Act and submitted that under those provisions, it would be a sub-licensee as deemed owner would be charged to tax in his hands. The CIT(A....