TaxTMI 
TaxTMI 
2017 (10) TMI 1569
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....n of income for the A.Y. 2012-13 on 28.09.2012 admitting total income of Rs. 6,88,57.610/- under normal provisions and book profits of Rs. 7,41,68,735/- under the provisions of Sec.115JB. The case was selected for 'Complete Scrutiny' under CASS and the scrutiny asst. was completed u/s.143 (3) on 27.02.2015 accepting the income returned under normal provisions. 3. The CIT by exercising powers vested u/s 263 of the Act, called for assessment record and on examining the same, observed that from the P&L a/c. assessee offered 'Income from operations' amounting to Rs. 15,13,48,379/- which includes rental income of Rs. 14,85,52,805/-. In the computation of total income, the rental income was reduced from the net profit shown in ....
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.... Further, CIT observed that though the Director's report (last page) indicate that the assessee company did not accept any deposits during the year and Note - 6 (other long term liabilities) clearly depict that an increase of Rs. 1.57 crores as compared to last year; in this back ground, as per CIT, AO ought to have examined the genuineness of the deposits during the year. it was stated in Director's report (Last page), Assessee Company has not accepted any deposits during the year. However, it is noticed from Note No.6. 'other long term liabilities', the rental deposits had shown an increase of Rs. 1,57,79,108/- as compared to last year and in this background the Assessing Officer ought to have examined the genuineness of th....
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.... constitute an organized structure for making profits and would necessarily constitute a business. A perusal of lease agreements and the stipulations contained therein would not leave any doubt about the commercial character of the relationship between the parties as distinguished from that merely of a landlord and his tenant. As the primary object of the assessee is to exploit the property by way of complex commercial activities, the income from the Same was to be considered as business income i.e. operational income as shown by the assessee in financials for the year. 9.2 Another important aspect to be noted in the present case is that income from generators, parking space rent etc. has been treated and offered as business income....
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....the interests of revenue as envisaged u/s 263 of the Act. He, accordingly, directed the AO to assess the rental income of Rs. 14,85,52,805/- as income from business instead of income from house property. 6. Aggrieved by the order of the CIT, the assessee is in appeal before us raising the following grounds of appeal: 1. The revisionary order u/s 263 of the Act, is erroneous both in law and on facts. 2. The Ld. Pr. CIT ought to have appreciated that the recourse to revision u/s 263 of the Act is not justified because the Assessing Officer has taken one of the courses permissible in law whereas the Pro CIT revised the assessment by change of opinion. 3. The Ld. Pr. CIT erred in treating the assessment order as er....
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....pined that the main object of the assessee was to exploit its properties by letting them out on rent as business proposition. Moreover, the assessee developed the property as a developer and not merely as the owner of these properties. CIT also referred to Apex Court decisions in the case of M/s Rayala Corporation Pvt. Ltd., Vs. ACIT, 386 ITR 500 and in the case of Chennai Properties & Investments Ltd., Vs. CIT, 373 ITR 673 wherein it was held that rental income received by the assessee having a business of renting the property as the main object should be assessed as business income. Hence, he was of the view that rental income should be assessed as business income. 7.1 In our considered view, the assessee ought to have submitted releva....
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.... the relevant information, but, the record does not indicate that the AO applied his mind. Under these circumstances, we are of the view that the case law relied upon by the assessee (Malabar Industrial Co. Ltd., 243 ITR 83 (SC) and other such cases taking a similar view) have no application to the instant case; in the aforecited cases, only AO has taken a specific stand upon application of mind, it is one of the views possible in the circumstances and those case law cannot be applied where the AO has not applied his mind. Having regard to the circumstances and for the detailed reasoning given by the revisional authority, we are of the view that the order passed by the AO is erroneous and prejudicial to the interests of revenue. However, in....