ACIT Cir-3,, Pune v. M/s. B.B.Associates,, Pune

ITA 1073/PUN/2009 | 2005-2006
Pronouncement Date: 31-01-2011 | Result: Dismissed

Appeal Details

RSA Number 107324514 RSA 2009
Assessee PAN AACFB5231C
Bench Pune
Appeal Number ITA 1073/PUN/2009
Duration Of Justice 1 year(s) 4 month(s) 23 day(s)
Appellant ACIT Cir-3,, Pune
Respondent M/s. B.B.Associates,, Pune
Appeal Type Income Tax Appeal
Pronouncement Date 31-01-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 31-01-2011
Assessment Year 2005-2006
Appeal Filed On 07-09-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A PUNE BEFORE SHRI I.C. SUDHIR (JM) AND SHRI D. KARUNAKARA RAO (AM) ITA NO. 1073 /PN/2009 ( ASSTT. YEARS : 200 5 - 06 ) ASSISTANT COMMISSIONER OF INCOME TAX CIRCLE 3 PUNE .. APPELLANT V. M/S . B.B. ASSOCIATES 242/1 NEELGIRI BHADARKAR INSTITUTE ROAD PUNE 411 004 PAN : AACFB5231C . RESPONDENT A PPELLANT BY : SHRI C.H. NANIWADEKAR RESPONDENT BY : SHRI ABHAY DAMLE ORDER PER I.C. SUDHIR JM THE REVENUE HAS QUESTIONED FIRST APPELLATE ORDER ON SEVERAL GROUNDS INVOLVING THE ISSUE AS TO WHETHER LD CIT(A) HAS ERRED IN HOLDING THAT THE RENT OF RS.1 45 43 560/ - ADMITTED BY THE ASSESSEE IN RESPECT OF COMMERCIAL BUILDING COULD ONLY BE ASSESSED UNDER THE HEAD INCOME FROM HOUSE PROPER TY AND NOT UNDER THE HEAD PROFITS AND GAINS OF BUSINESS OR PROFESSION. 2. AT THE OUTSET OF HEARING THE LD. A.R. POINTED OUT THAT THE ISSUE RAISED IN THE GROUNDS HAS ALREADY BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY PUNE BENCH OF THE TRIBUNAL IN THE CASE OF ASSESSEE ITSELF FOR THE A.Y. 2003 - 04 VIDE ORDER DT. 3 RD OCTOBER 2008 IN ITA NO. 64/PN/2007. A COPY THEREOF HAS BEEN SO FURNISHED IN SUPPORT. 3. THE LD. D.R. DID NOT DISPUTE THE ABOVE SUBMISSION OF THE LD. A.R.. HE HOWEVER PLACED RELIANCE ON T HE ASSESSMENT ORDER. ITA NO 1073 /PN/200 9 M/S. B.B. ASSOCIATES PUNE ASSTT. YEAR 2005 - 06 PAGE OF 3 2 4. HAVING GONE THROUGH THE CITED ORDER DT. 3 RD OCTOBER 2008 OF THE TRIBUNAL IN THE CASE OF THE ASSESSEE FOR THE A.Y. 2003 - 04 ON AN IDENTICAL ISSUE WE FIND THAT THE ISSUE IS FULLY COVERED IN FAVOUR OF THE ASSESSEE. THE RELEVANT FACTS ARE THAT THE ASSESSEE FIRM IN THE BUSINESS OF BUILDERS DEVELOPERS AND PROMOTERS IN ITS RETURN OF INCOME ALSO INCLUDED INCOME FROM HOUSE PROPERTY EARNED FROM RENTAL RECEIPTS. THE A.O OBSERVED THAT IN THE A.Y. 2003 - 04 THE SIMILAR INCOME DERIVED FROM LEASE RENT WAS ASSESSED AS BUSINESS INCOME. HE ACCORDINGLY TREATED THE INCOME FROM HOUSE PROPERTY CLAIMED AT RS. 1 45 43 560/ - AS BUSINESS INCOME. THE LD CIT(A) FOLLOWING THE ORDER DT. 3 RD OCTOBER 2008 OF THE TRIBUNAL IN THE CASE OF ASSESSEE ITSELF ( SUPRA) ON AN IDENTICAL ISSUE FOR THE A.Y. 2003 - 04 HAS ACCEPTED THE CLAIMED RENT RECEIPT AS INCOME FROM HOUSE PROPERTY. WE THUS FIND THAT THE VERY BASIS I.E. ASSESSMENT FOR THE A.Y. 2003 - 04 ON WHICH THE A.O. HAS TREATED THE RENT AS BUSINESS INCOME HAS BEEN RE VER TED BY THE TRIBUNAL FOLLOWING THE DECISION OF SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ATMA R AM PROPERTIES P. LTD. V/S. JCIT (2006) 8 SOT 741 (DEL) (SB) HOLDING THAT THE RENTAL INCOME DERIVED BY THE ASSESSEE COMPANY BY LETTING OUT A PROPERT Y SIMPLICITOR WAS CHARGEABLE TO TAX UNDER THE HEAD INCOME FROM HOUSE PROPERTY AND NOT AS BUSINESS INCOME IRRESPECTIVE OF THE FACT THAT THE ASSESSEE COMPANY WAS DOING BUSINESS OF ACQUIRING DEVELOPING AND SELLING PROPERTIES AS THE RENTAL INCOME WAS REC EIVED BY IT BECAUSE OF OWNERSHIP OF THE PROPERTY AND NOT BY EXPLOITATION OF THE PROPERTY BY WAY OF COMPLEX COMMERCIAL ACTIVITY. RESPECTFULLY FOLLOWING THE SAID DECISION OF SPECIAL BENCH OF THE TRIBUNAL ON THE ISSUE WE DO NOT FIND REASONS TO INTERFERE WI TH THE FINDINGS OF THE LD CIT(A) IN THIS REGARD. THE SAME IS UPHELD. THE ISSUE IS THUS DECIDED IN FAVOUR OF THE ASSESSEE. THE GROUNDS INVOLVING THE ISSUE ARE THUS REJECTED. CONSEQUENTLY APPEAL IS DISMISSED. ITA NO 1073 /PN/200 9 M/S. B.B. ASSOCIATES PUNE ASSTT. YEAR 2005 - 06 PAGE OF 3 3 ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST DAY OF JANUARY 201 1 SD/ - SD/ - (D. KARUNAKARA RAO) ACCOUNTANT MEMBER (I.C. SUDHIR ) JUDICIAL MEMBER PUNE DATED THE 31ST JANUARY 2011 US COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDEN T 3. THE CIT - II PUNE 4. THE CIT(A) - I I PUNE 5. THE D.R.A BENCH ITAT PUNE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE