TaxTMI 
TaxTMI 
2014 (8) TMI 392
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....ction?" 2.0. That the assessee filed return of income for the year consideration declaring total income at Rs. 18,58,721/. The same was processed under Section 143(1) of the Income Tax Act, 1961 (hereinafter referred to as the "Act"). The case was later on selected for scrutiny assessment. Notice under Section 143(2) of the Act was issued, which was duly served upon the assessee. It appears that during the year under consideration and though the assessee company had given the complete production facility on rent and entered into lease agreement with Rex-tone Industries Limited, Mumbai to allow them to utilize the buildings along with land located at Plot No.5, GIDC, Por, Vadodara and received total rental income at Rs. 39 lacs. The assessee furnished computation of income and it was notice that rental income at Rs. 39 lacs under the head the income from house property and claimed deduction under Section 24 of the Act of Rs. 11,70,000/. The assessee also claimed set off business loss of Rs. 8,71,279/against the income from house property under Section 71 of the Act. The assessee was called upon to justify its claim of set off business loss at Rs. 8,71,279/against the income recei....
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....hat the learned Assessing Officer has materially erred in not properly appreciating the aforesaid fact. It is submitted that therefore, the learned CIT(A) as well as learned Tribunal have materially erred in confirming the order passed by the Assessing Officer. It is further submitted by Shri Shah, learned advocate for the assessee that even the learned Tribunal has not considered and / or dealt with the decision of the Tribunal of Delhi Bench in the case of ITO vs. Mokul Finance Private Limited reported in (2009) 29 SOT 11 (Delhi) which was relied upon by the assessee. It is submitted that the same was required to be dealt with and considered by the learned Tribunal. It is further submitted that even the learned Tribunal has relied upon the decision of the Rajkot Bench of the ITAT in the case of Master Silk Mills (P) Ltd 77 ITD 530 (Rajkot), however against the aforesaid decision, Tax Appeal is pending before this Court. Therefore, it is requested to admit the present Tax Appeal and to be heard with aforesaid Tax Appeal No.17 of 2001. Making above submissions, it is requested to admit / allow the present Tax Appeal. 4.0. Heard Shri Tej Shah, learned advocate for the appellant a....
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....rinting inks. This is also a fact that the entire premises has been given on lease and thus, the appellant is not carrying on any business activity from this premises. The deed also provides that all the utilities payments on this premises such as electricity telephone, water, drainage charges etc. shall be fully paid by licenses from 1st February 2008 upto the date of occupancy. The licensee has also been allowed to make interior improvements or alterations on its own expenses. It also provides that the licensee shall be responsible entirely for the repairs and maintenance of any of breakages and damages to the demised premises during the entire term of agreement. The licensee is also obliged to take comprehensive insurance policy for this building. The deed further provides that the notified are charges of Rs. 1,27,254/shall be paid by the licensor. 3.2.1. Now, the computations of income filed by the appellant is as follows: Annual letting value Rs. 39,00,000/- Less: Deduction u/s 24 Rs. 11,70,000/- Total income under head house property Income under head Business & Profession: Rs. 27.30,000/- Net Profit as per P & L A/c Rs. 17,54,335/- Add: It....
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....lant has also shown purchase of one Onida make split AC, which has been shown as part of the closing stock. The cost of this AC is Rs. 18,800/. 3.2.4. Thus, the appellant evidently has stopped its manufacturing activity and rented out the entire factory premises to other party. Still, it is showing huge repair expenses to the factory in its books of accounts. Besides, it is showing three transactions of sale in order to show that it still carrying on business activity. But these three transactions are only a device to claim huge expenses being debited in the profit and loss account and which are not allowable as a deduction in computation of income from house property. The Rajkot Bench of ITAT in its decision in the case of Master Silk Mills (P) Limited 77 ITD 530 (Rajkot) had refused to accept a similar argument on the basis of insignificant and small transactions that the business was still carried on by the appellant. Hence, it is held that the appellant has not carried on any business activity in this year. 3.2.5. Thus, at one hand, the appellant is claiming statutory deduction under section 24 of the Income Tax Act, 1961 equal to 30% of the annual value amounting to Rs. ....