TaxTMI 
TaxTMI 
2014 (1) TMI 1440
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....8,75,000/- on a/c of rental income from letting out of building and plant as income from other sources as against treated the same as income from business or profession offered by the appellant. 2. The Ld. Commissioner of Income Tax (A) erred in thereby confirming the disallowance of the expenses claimed against the said income. 3. The Ld. Commissioner of Income Tax (A) erred in confirming and treating the interest income of Rs. 26,28,411/- as income from other sources. 4. The Ld. Commissioner of Income Tax (A) thereby erred in confirming the disallowance of the expenses claimed against the said income. 5. The Ld. Commissioner of Income Tax (A) erred in confirming charging interest u/s 234B & 234C of the Income Tax Ac, 1961." 3. Ground....
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....ors to abroad for inspection and import of gym equipment. Therefore, after obtaining the IEC and RBI codes for the purpose of requisite gym equipments were imported. This entire exercise of developing the premises as fitness centre clearly shows that the assessee has carried out al l these work as commercial venture. The assessee has not leased out the premises rather it had entered into business agreement with four different parties and maintenance of gym with the assessee. The Ld. A.R has further contended that it has not received lease rent rather received compensation. He has referred the clause 3 of the business centre agreement which reads as under: "3. The company hereby agrees to al low, and render to the client the following facil....
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....entre. (k) To provide a separate electricity meter for the client in the centre. (l) To provide portable fire extinguishers in the centre. (m) To provide any further reasonable Gym Facilities to the client which the client requires, upon term and condition mutually agreed upon. (n) These services will be provided by the company of the premises and services will be available to client as per existing norms and practices." 5. The Ld. A.R has submitted that the agreement clearly shows that the assessee has provided many services which are part of its business. The entire arrangement indicates that the assessee is in the business of gymnasium and fitness. The assessee has invested huge money in equipment and other facility on which depreci....
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.... but the assessee has developed and prepared the premises as a fitness centre/gymnasium by installing the all requisite equipments, machines and other facilities. Therefore, the primary purpose and intention of the assessee to lease out the assets comprising the premises as well as the equipments is to earn the income by exploiting the asset being earning apparatus. The assessee has also undertaken the various activity of maintenance providing staff and other facilities for smooth functioning of the fitness centre. Therefore, it is not a simple case of earning the rental income from letting out the premises. The Revenue has accepted the income from lease out the premises as business income for the assessment year 2006-07 to 2010-11 except t....
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....due dated of filing the return. 8. Ground NO. 3 & 4 regarding the interest income treated as income from other sources. During the previous year the assessee has received interest income of Rs. 34,21,921/-. The A.O held that the interest income is assessable as income from other sources u/s 56 of the Income Tax Act. Accordingly, the interest income is assessed to tax under the head income from other sources and consequently certain expenses were disallowed. On appeal, the CIT(A) has confirmed the action of the A.O. 9. Before us the Ld. A.R of the assessee has submitted that the assessee is in the business of money lending right from the beginning. He has referred the details of the loans given by the assessee from the assessment year 2003....