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TMI Blog2012 (8) TMI 643X X X X Extracts X X X X X X X X Extracts X X X X ..... not for the use of the land, but for maintenance of the various services, including the technical services involving navigation, would not automatically bring the transaction and the charges within the meaning of either lease or sub-lease or tenancy or any other agreement or arrangement of a nature of lease or tenancy and rent - for the purpose of treating the payment as rent, such use would fall under the expression "use of land". Thus, going by the nature of services offered by the Airport Authority of India for landing and parking charges thus collected from the assessee herein, no ground to accept that the payment would fit in with the definition of 'rent' as given under Section 194-I - in favour of assessee. - Tax Case (Appeal) Nos.15 to 20 of 2006 - - - Dated:- 13-7-2012 - Chitra Venkataraman And K Ravichandrabaabu, JJ Appellant Rep by: Mr T R Senthil Kumar, Standing Counsel Respondent Rep by: Mr Farooq Irani, SC., For M/s O R Santhakrishnan S K Rahul Vivek JUDGEMENT Per: Chitra Venkataraman: The Revenue has filed the above Tax Case (Appeals) as against the order of the Income Tax Appellate Tribunal relating to the assessment years 1997-98, 1998-99 and 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... asoning, which was also accepted by the Tribunal of the Madras Bench in the assessee's case. The assessee had also accepted the liability under Section 194 C of the Income Tax Act. 5. As far as navigation facilities were concerned, the assessee did not make a serious dispute, in other words, it conceded that it was in the nature of charges paid for getting technical services, apart from using the equipments for the purpose of communication between the aircraft and the air traffic controller, thus, Section 194 J was held applicable. 6. In the light of the decision thus arrived at, the Tribunal thought it fit to remand the matter back to the Assessing Authority to work out the interest payable till the date on which the International Airport Authority had paid the tax in respect of the amount received from the assessee, particularly with reference to the liability under Section 194 C of the Income Tax Act. Aggrieved by this, the present appeals have been filed by the Revenue. 7. Learned Standing Counsel appearing for the Revenue placed heavy reliance on the definition of 'rent' as found in Section 194 I Explanation of the Income Tax Act and placed reliance on the decision of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nition of 'rent', he pointed out that the definition is an exhaustive definition and that considering this reference to the preceding enumeration, namely, lease, sub-lease or tenancy, the reference to any other agreement or arrangement as appearing in the definition has to be understood applying the principle of ejusdem generis; that the said arrangement or agreement has to be in respect of use of any land or any building as under a tenancy or lease, that the payment received qualified to be treated as 'rent'. He pointed out that even though the Delhi High Court had referred to the definition of 'rent', it had not taken note of the facts as are projected in the present case that there is no use of any land as in the case of tenancy or lease, that all that the airlines had paid was only for the services rendered by the Airport Authority in providing the facilities for landing including the navigational facility and the payment is measured with reference to the various parameters, which are given by the International Airport Authority in its various circulars. Thus raising the question as to whether the various facilities offered and the charges fixed therefor on the basis of weight ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... divided family, who is responsible for paying to any person any income by way of rent, shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rate of - (a).... (b)........... Explanation For the purposes of this section - (i) "rent" means any payment, by whatever name called, under any lease, sub-lease, tenancy or any other agreement or arrangement for the use of any land or any building (including factory building), together with furniture, fittings and the land appurtenant thereto, whether or not such building is owned by the payee; (ii)......." 14. As rightly pointed out by the learned Senior Counsel appearing for the assessee, the definition begins with a phrase "rent to mean". Being an exhaustive definition, by whatever name called, payment made for the use of any land or building and the land appurtenant thereto under a lease or sub-lease or tenancy or under any agreement or arrangement with reference to the use of the land, would be "rent". Thus to be called a lease, sub-l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n relation to the landing and parking area and hence, the payment could not be called as rent. Thus it held that whether the nature of services offered, would fit in with the definition of lease or tenancy, has to be decided with reference to the materials. 17. As far as the present case is concerned, learned Senior Counsel produced before us materials like Airport Economic Manual, the International Airports Transport Agreement (IATA) to the contracting States on charges for Airport and Air Navigation Services, indicating the nature of services offered by the Airports Authority of India. Under the provisions of the Airports Authority of India Act, 1994, the Airport Authority is given powers to charge rent etc. for landing, housing and parking of aircrafts and any other services or facilities offered in connection with the aircraft operations at the airport and also for providing air traffic services, ground safety services, aeronautical communication facilities, installation and maintenance of navigational aids and meteorological services at the airport, which are necessary for the safe aircraft landing and for air passengers' safety in connection with the aircraft operation at t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present case before us, cannot be construed as 'rent'. It is difficult to accept the case of the Revenue that a mere touchdown on the land surface would bring the case of the assessee that there is a lease or an agreement or arrangement answering the character of lease that the charges would fall within the meaning of 'rent', as appearing in Section 194-I Explanation. It is no doubt true that in the decision reported in (2006) 287 ITR 281 (United Airlines V. CIT) , the Delhi High Court pointed out that an aircraft on coming into an airport and on touching the surface of the airfield, the use of the land immediately beings. So too, on parking of the aircraft, there is a use of the land. But by this alone, one cannot come to the conclusion that the use of the land leads to an inference of the existence of a lease or an arrangement in the nature of lease. By the very nature of things, as a means of transport, an aircraft has to touch down for disembarking the passengers and the goods before it takes off; for this facility to be offered, the Airport Authority charges a price. Given the complexity in landing and take-off, unlike in the case of vehicles on road, the Airport Authority ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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