TaxTMI 
TaxTMI 
2017 (2) TMI 329
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...., and March 6, 2012. For the assessment year 2009-10, the assessee as well as the Revenue is in cross appeal against the impugned order dated July 6, 2012, of the learned first appellate authority, Mumbai. 2. First, we shall take up the appeal of the Revenue for the assessment year 2007-08 (I. T. A. No. 6335/Mum/2012), wherein, the only ground pertains to treating the entrance fee received from its members as capital receipts ignoring that the facilities that are made available to the members are done in the normal course of its business as the assessee is engaged in the business of race course. 2.1. During hearing, Capt. Pradeep S. Arya, learned Departmental representative, advanced arguments which is identical to the ground raised b....
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....ies Ltd. [2013] 358 ITR 295 (SC). 2.2. We have considered the rival submissions and perused the material available on record. The facts, in brief, are that the assessee is in the business of conducting horse races and also providing hospitality services to its members and their guests. The assessee declared nil income after carry forward losses of Rs. 2,04,85,610. The assessment was completed under section 144 of the Act assessing the income at Rs. 19,75,86,345 on December 29, 2009, after set off of carry forward losses of Rs. 12,22,09,693. The learned Assessing Officer added Rs. 2,92,13,500 (entrance fee) by holding the same as revenue in nature. On appeal, before the learned Commissioner of Income-tax (Appeals), the impugned addition w....
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....ht to our notice. It is also noted that even the revisional jurisdiction under section 263 was invoked by the Department and, finally, the entrance fees was treated as capital receipt, therefore, we find force in the contention of the assessee. 2.4. If this issue is analysed on the principle of consistency, we note that in earlier years, identically the claim of the assessee was decided in favour of the assessee by accepting the entrance fees as capital receipt, therefore, we are of the view that unless and until contrary facts are brought on record by the Revenue, no U-turn is permissible. The learned Assessing Officer is bound by rule of consistency. The following cases support the case of the assessee : (i) Parashuram Pottery....
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....e principle of consistency also, the assessee is having a good case in its favour, thus, considering the totality of facts, we find no infirmity in the order of the learned Commissioner of Income-tax (Appeals). 3. Now, we shall take up appeal of the Revenue for the assessment year 2008-09 (I. T. A. No. 4235/Mum/2012), wherein, first ground pertains to entrance fee received from its member. In the light of the foregoing discussion (I. T. A. No. 6335/Mum/2012), we find no infirmity in the order of the learned Commissioner of Income-tax (Appeals), therefore, this issue is decided in favour of the assessee. 4. The next ground pertains to treating the amount of Rs. 10 crores as capital receipt, received from Pegasus Resorts and Hotels Pvt.....
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....Rs. 13.50 crores per year from 41st year. It means the assessee was earning interest on this deposit. Over and above this, the assessee was to recover royalty at the rate of 6.25 crores per year, which increase to Rs. 24.57 crores from 41st year. As per paragraph 5.1 of the agreement, the first security deposit of Rs. 10 crores stand forfeited, as liquidity damages if due to any reason, the work related to "new development" is not completed by M/s. Pegasus Resorts and Hotels Pvt. Ltd. Since the new development could not be started due to inability of M/s. Pegasus Resorts and Hotels Pvt. Ltd., the aforesaid amount was forfeited by the assessee. We are of the view that since the amount of Rs. 10 crores was in the nature of deposits, i.e., cap....