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TMI Blog2009 (4) TMI 552X X X X Extracts X X X X X X X X Extracts X X X X ..... carrying on the business of running a hotel under the name and style of "Le Meridien" at Maradu, Kochi. The assessee filed its return of expenditure tax in Form No. 3 on a chargeable expenditure of Rs. 5,18,64,207. In the statement filed along with the return, the assessee has claimed the income from health club and rental income from International Convention Centre as exempt from chargeable expenditure. The amount so claimed as exempt amounted to Rs. 1,07,31 977. The Assessing Officer rejected the claim of the assessee and held that the said amount also formed part or chargeable expenditure. 3. In first appeal, the CIT(A) held that hotel includes a building or part of a building where residential accommodation is, by way of business, p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) to Rule (3) of the Income-tax Act, 1961 defines "Hotel" as a licensed accommodation in the nature of Motels, Service Apartments, Guest Houses, Caravan, Mobile Homes, Ships or other floating structures but not Convention Centres. 4. Hotel accommodation as explained in Explanation ( i ) to Rule (3) of the Income-tax Act, 1961 means a place where facilities are available for night stay, eating, sleeping, taking bath and so on whereas in Convention Centres only meetings of social and business nature are held which itself confirms that payment made to a Convention Centre is not Includable to chargeable expenditure listed out in section (5) of the Expenditure Tax 1987. 5. The conclusions of the Commissioner in para (5.1) of the order tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the Revenue is not built up on the above factor. Keeping separate accounts and keeping separate facilities for the convention centre, on the other hand, do not make the convention centre a business different from that of the hotel on these grounds. Apart from these physical and technical points, one has to examine the substance over the form. As per the language employed in the statute, hotel includes a building or a part of a building where business is carried out mainly for a monetary consideration. The main business of the assessee is running a hotel and without any dispute the assessee is liable for chargeable expenditure in respect of the hotel business. Section 3(1) further provides for any expenditure incurred in respect of any ..... X X X X Extracts X X X X X X X X Extracts X X X X
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