AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 352
X X X X Extracts X X X X
X X X X Extracts X X X X
....olved in developing and leasing investment property in IT/ITeS Sector. The assessee company filed its return of income on 29.11.2014 declaring total income at Nil under normal provision and book profit of Rs. 38,90,95,461/- under Section 115JB of the Act. The case was selected for scrutiny under 'Complete Scrutiny' parameter. Notices under Section 143(2) of the Act were issued on 28.08.2015 and 10.09.2015. Notice under Section 142(1) of the Act along with questionnaire was issued on 25.05.2016, seeking certain documents. Due to change of Ld. AO, notice under Section 143(2) read with section 142(1) was issued on 21.07.2016. Shri Ajay Rastogi, CA & AR of the assessee attended the proceedings and furnished the requisite documents and details etc. On completion of assessment proceeding, Ld. AO vide order dated 29.12.2016 made additions of Rs. 46,01,279/- and Rs. 5,88,581/-. 3. Against order dated 29.12.2016 of Ld. AO, the appellant/assessee preferred appeal before the Ld. CIT(A) which was partly allowed vide order dated 27.06.2017. 4. Being aggrieved, the appellant/assessee preferred present appeal with following grounds: "Ground 1. 1. On the facts and circumsta....
X X X X Extracts X X X X
X X X X Extracts X X X X
....de notification no. F. No. 2/40/2006 dated March 10, 2008, the Board of Approval ('BOA') of Ministry of Commerce and Industry granted approval for authorized operations to be carried out by the Appellant in SEZ for IT/ITeS sector (refer Page No. 38 of the Paperbook). The list of authorised operations annexed with such approval which also included food services including cafeteria, food court(s), restaurants, coffee shops, canteens, and catering facilities (as reproduced below): M/s. Seaview Developers Limited, Noida, Uttar Pradesh Authorized operations inn the Processing Area S. No. ACTIVITY Quantum approved 1. Power (including power back up facilities) 30 MW 2. Parking Including multi-level car/two wheeler parking (automated or manual) 3. Recreational facilities including club house, indoor or outdoor games, Gym etc. 1100 sq.m. 4. Food services including cafeteria, food court(s) restaurants, coffee shopa, canteens and catering facilities. 3000 sq.m. 5. Employee welfare facilities like crèche, medical center and other such facilities. 1000 sq. m. 6. Shopping arcade and/or retail space. 950 sq....
X X X X Extracts X X X X
X X X X Extracts X X X X
....uction under section 80IAB of the Act against the whole amount of disallowance of interest expenses on TDS. However, the Ld. AO again added back the interest expenses on TDS of Rs. 5,88,581/- under the head 'Income from Other Sources without providing any reason for such addition, leading to double disallowance of the same expenses under two different head of income. 6.1 In view of above stated facts, the appellant/assessee prays that the interest expenses on TDS of Rs. 5,88,581/- being already added back under the head 'Profit and Gains from Business and Profession' should not again be added back under head 'Income from Other Sources'. Accordingly, the addition made by the Ld. AO under the head 'Income from Other Sources' on account of interest expense on TDS amounting to Rs. 5,88,581/- may be deleted. 6.2 Without prejudice to the foregoing contentions, the withholding tax liability is a vicarious liability. An assessee is required to withhold tax from the amount of expenditure incurred by the assessee as per the provision of the Act and thereafter, the assessee acting as agent of the government is required to pay the said tax component to the credit ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....51/-. Ld. AO vide assessment order dated 29.12.2016 under Section 143(3) of the Act, assessed income of Rs. 51,89,860/-. Under the normal provisions of the Act and book profit of Rs. 38,90,95,461/- under Section 115JB of the Act. The difference in returned income and assessed income was due to addition of interest by denying deduction of interest income of Rs. 15,13,228/- under Section 80IAB of the Act. Denial of deduction on sale of food and beverages of Rs. 1,68,81,429/- and disallowance of interest of TDS of Rs. 5,88,,581 claimed as business expenses. Ld. CIT(A) vide order dated 27.06.2017 deleted addition of interest income of Rs. 15,13,228/- but sustained the disallowance of deduction under Section 80IAB of the Act on sale of food and beverages at Rs. 1,68,81,429/- and interest paid on details of interest TDS at Rs. 5,81,588/-. 8.1 As per letter dated 10.03.2008, assessee was authorized for food court activities which were covered under Section 80IAB of the Act. Letter of authorization is at page no. 37 of the paper books. Notification dated 27.10.2006 on page no.39 of the paper books contains entries no. (xxiii) Food Services including Cafeteria, food court(s), Restaurants....
X X X X Extracts X X X X
X X X X Extracts X X X X
..../SEZ is to be charged under head 'Profits and Gains of Business' or under the head 'Income from House Property' has been subject matter of litigation in recent years. Assessee's claim the letting out as business activity, the income arising from which to be charged to tax under the head 'Profits and Gains of Business', whereas the Assessing Officers hold it to be chargeable under the head 'Income from House Property'. 2. The matter has been considered by the Board. Income from the Industrial Parks/SEZ established under various schemes framed and notified under section 80IA(4)(iii) of the Income-tax Act, 1961 ('Act') is liable to be treated as income from business provided the conditions prescribed under the schemes are met. In the case of Velankani Information Systems Pvt Ltd., [2013] 35 taxmann.com 1 (Karnataka) the Hon'ble Karnataka High Court observed that any other interpretation would defeat the object of section 80-IA of the Act and government schemes for development of Industrial Parks in the country. SLPs filed in this case by the Department have been dismissed by the Hon'ble Supreme Court. In a subsequent judgment da....