TaxTMI 
TaxTMI 
2011 (8) TMI 1169
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....ilder, is engaged in the business of construction work. It filed return of income on 28th October 2005, declaring a loss of ` 64,29,510. 3. The assessee company purchased a property situated at Corporate Centre, I.T. Park, CTS no.271, Village Kondivite, Andheri (E), Mumbai. Infrastructure and equipments were installed in the said I.T. Park as per the requirements. The I.T. Park was duly notified by the Ministry of Commerce and Industries, New Delhi, vide notification S.O. no.354(E) dated 1st April 2002, which was later amended vide letter dated 5th January 2005. The I.T. Park was also notified by CBDT, vide notification no.61 dated 22nd July 2010. The assessee company had purchased the property along with the infrastructure, equipment an....
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.... 3. On the facts and circumstances of the case as well as in law, the learned CIT(A) has erred in confirming the action of Assessing Officer in disallowing the claim of deduction under section 80IA(4)(iii) without considering the facts & circumstances of the case. 4. On the facts and circumstances of the case as well as in law, the learned CIT(A) has erred in confirming the action of Assessing Officer in adding on ad-hoc basis the interest that would have been earned on the deposit taken from the IT company client who was occupying the premises of the appellant as income from house property of the appellant for the year without considering the facts and circumstances of the case." 5. Before us, learned Counsel, Mr. Rakesh....
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....f the assessee. He submits that the term "Business" is defined in an inclusive manner and the assessee has chosen a property which is notified as an I.T. Park, by the statutory authorities, by itself demonstrates that the assessee has undertaken certain risks, which is a foremost condition in the case of business. He points out that the assessee is incurring expenditure for up-keep of various allied services. He claimed that the actual expenditure including depreciation is higher in case of the assessee. In support of his arguments, he relied on the following case laws for the proposition that the income in question is assessable under the head "Income From Business", and not under the head "Income From House Property". _ ACIT v/s ....
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....ons of the assessee and submits that the purchase was made from a sister concern and the assessee never carried out any business in the premises. He referred to the order of the Commissioner (Appeals) and points out that all the expenditure of running and maintaining the business centre are borne by M/s. Krishna Developer P. Ltd., i.e., the company from which the assessee has purchased the property. He submits that this is a sister concern and the other concern collects the expenditure from all the parties. He submits that the intention of the parties from the beginning was to simply lease out the property and earn a return. In support of his arguments, he relied on the judgment of Hon'ble Supreme Court in Shambhu Investments P. Ltd. (s....
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....st, that the main intention is to let out the property, it must be considered as rental income or income from property. In case it is found that the main intention is to exploit the property by way of complex commercial activities, in that event, it must be held as business income. In the case before us, the assessee is offering complex services by way of providing operation place in a notified I.T. Park, with all services and amenities such as infrastructure facilities, waiting room, conference room, valet parking, reception, canteen, 24 hours securities, internal facilities, high speed lift, power back-up, etc. Just because a sister concern incurred this expenditure and claims reimbursement from the assessee, it cannot be said that the fa....
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....ld the contention of the assessee that the income in question should be assessed under the head "Income From Business & Profession". Consequently, we set aside the order passed by the Commissioner (Appeals) and allow the ground raised by the assessee. 14. Coming to grounds no.2 and 3, the Assessing Officer is directed to allow the claim of expenses as the disallowance was made only on the ground that the income is assessable under the head "House Property". Consequent to our decision in ground no.1, we direct the Assessing Officer to allow both the expenditure claimed as well as the claim for deduction under section 80IA(4)(iii). Consequently, we set aside the order passed by the Commissioner (Appeals) and allow the ground no.2 and 3 ....