2025 (2) TMI 394

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....venue. For the reasons stated in the application filed by the Revenue, we condone the delay. 4. The sum and substance of the revised grievance of the Revenue is that the Ld. CIT(A) wrongly held that the rental income earned by the assessee was taxable under the head house property and not to be taxed under the head "profit and gains from business and professions.". 5. Briefly stated, the facts of the case are that the assessee filed its Return of Income on 30.03.2018 declaring an income of Rs. 9,94,07,353/-. Return was selected for limited scrutiny assessment and accordingly, statutory notice u/s 143(2) of the Act was issued. 6. The assessee is a Private Limited Company carrying on the business of carpet fabrication, with the facto....

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.... proofs and computations of income of the assessee company for A.Y 2011-12 to AY 2021-22 were furnished on record. 12. It is the say of the ld. counsel for the assessee that assessment of the assessee company for AY 2010-11 and 2011-12, have been completed u/s 143(3) in scrutiny assessment proceedings where the rental income has been assessed under the head House Property only. Copies of the assessment orders of the assessee company for A.Ys. 2010-11 and 2011- 12 have been furnished for our perusal. 13. The ld. counsel for the assessee vehemently contended that since the assessee has been offering the rent received to tax under the head house property since 2007, the rule of consistency has to be followed in the income tax proceedings....

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....hould be taxable under the head Business Income, then the department may be directed to allow the expenses relating to the rental income of Rs. 30,85,405/-, as disallowed by the assessee in its computation of income and also allow depreciation on the leased out building. Therefore, the ld. counsel for the assessee prayed to dismiss the appeal of the revenue and uphold the order of the CIT(A). 17. We have heard the rival submissions and have perused the relevant material on record. It would be pertinent to extract the findings of the ld. CIT(A) at paras 7.27 and 7.28 which clearly explain the factual position and conclusion arrived at by the ld. CIT(A). The same reads as under: "7.2.7 I have considered the finding of A.O., submis....

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....and not the letting of properties. I find that the judgment of the Hon'ble Supreme Court in Shambhu Investment (P) Ltd. favors the assessee, where consolidated rent was charged for letting out furnished space with Furniture and fixture, Light, Air Conditioners, Watch and ward staff electricity, water (non is separately charged) and the assessment of such rental income has been up held by the Hon'ble Supreme Court under the head Income from House Property. 7.2.8 In view of above fact and respectfully following the judgment of Hon'ble Supreme Court in the case of Shambhu Investment (P) Ltd., I hold that the rental income of the assessee is assessable as Income from House Property, further hold that the action of the A.O.,....