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Issues:
1. Jurisdiction of Commissioner to revise assessment order after appeal. 2. Assessment of income from property provided to Air India. 3. Nature of arrangement with Air India - business income or income from letting out property. 4. Consideration of unrealized rent under the agreement with Air India. Detailed Analysis: 1. The first issue revolves around the jurisdiction of the Commissioner to revise an assessment order after an appeal has been decided. The appellant argued that once an appeal has been considered by the Appellate Authority, the Commissioner lacks the authority to revise the assessment order. The appellant relied on legal commentary and case law to support this argument. However, the Tribunal rejected this contention, citing various judgments and holding that there would be no merger if the Appellate Authority has not decided a particular point in the appeal against the assessment order. Therefore, the Commissioner had the jurisdiction to revise the assessment order in this case. 2. The second issue concerns the assessment of income from property provided to Air India. The dispute arose from the CIT's contention that under the IT Act, the annual value of property owned by an assessee is chargeable to income tax under the head 'income from house property'. The CIT argued that even if no rent or compensation was received, the assessee could not escape assessment of the property's annual value. The Tribunal examined the arguments and held that the ITO's assessment of the income from the property as 'nil' was incorrect in law, emphasizing the artificial or notional income aspect under section 22 of the IT Act. 3. The third issue delves into the nature of the arrangement with Air India - whether it constituted business income or income from letting out the property. The appellant contended that the arrangement was a service contract, not income from letting out the property. Legal precedents were cited to support this argument. The Tribunal acknowledged the ambiguity in the contract but noted that the CIT had not directed proper inquiries into the matter. The Tribunal highlighted the need for a thorough investigation to determine the nature of the arrangement accurately. 4. The final issue pertains to the consideration of unrealized rent under the agreement with Air India. The appellant argued that no income was liable to be assessed as no amount was recoverable under the agreement. The Tribunal examined a clause in the agreement that stated no reimbursement would be made if the transportation services were not utilized. The Tribunal concluded that the agreement did not warrant an inquiry into its bona fides by the ITO. Consequently, the Commissioner's order was deemed futile, and the appeals were accepted, ultimately quashing the Commissioner's order.
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