2014 (6) TMI 803

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.... the AO in treating the income earned by the assessee from business service centre as income from other sources against the same declared by the assessee as business income. The relevant facts are that the assessee, a company earlier engaged in the business of embroidery which was closed down, for the last many years had let out its business property. The incomes received by the assessee from letting down the premise, during the years under consideration were treated by the AO as income from other source. According to the AO, rental income was nothing but income earned from sub-letting and it is a trite law that where the assessee is a tenant and makes profit by letting it, the income is chargeable under the head income from other sources. ....

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....sessee has provided the services for using all the furniture, fixtures, cabinets, cupboards, equipments, accessories which are exclusively owned by the centre shall be in the possession and complete control of the management of the centre. Further para 4 of the said agreement provides that common services and facilities may be made available on daily or weekly basis. This common services and facilities include the sweeping, peons, common receptions, use of cotton lounge and common personal service for members. Further para 17 of the this agreement reads, nothing herein contained shall in any way be construed as a tenancy of any sought between the parties nor shall confer any tenancy, lease, live and license conducting or other rights of any....

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....ee in all the earlier years treated the same as business income rather than assessed as income from house property. Further, the Tribunal in the case of M/s. Saval Das Madhav Das in ITA Nos. 4243/Mum/2005, by following the principle of consistency, has held that the income received by the assessee from executive business centre has to be treated as business income of the assessee. Considering the said decisions aforementioned, the fact that the assessee running the business centre by exploiting the property is not merely an activity of letting out the property and the fact that the assessee has been showing the rent received from letting out the business centre under the head business income continuously since 1984, we are of the considered....