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TMI Blog2015 (7) TMI 912X X X X Extracts X X X X X X X X Extracts X X X X ..... nvenience. ITA no. 774/Del/2012 (Somya Salwan): 2. The assessee, an individual, in the relevant assessment year, derived salary income from three companies, namely, M/s A.K. Govil & Company, M/s GPPL and M/s Stem Infra. Besides, the assessee had rental income from business and other sources. She had filed her return through e-filing declaring a loss of Rs. 6,48,890/- The AO observed that AIR information had been generated in respect of the assessee as under: (i) Rental income Rs. 950000/- from Stem Infra Services Pvt. Ltd. (ii) Contractor receipt amounting to Rs. 550000/- from Stem Infra Services Pvt. Ltd. 3. The AO noticed from the computation of assessee that assessee had not shown the contractual receipts aggregating to Rs. 5,50,00 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able under the head of Income from House Property and hence, the assessee is not entitled to receive the deductions allowable u/s 24 of Income Tax Act. In view of this, the contract receipt of Rs. 11,50,000/- are deducted from the income from house property and are being assessed under income from other sources. 5. The AO, accordingly, assessed the contractual receipts of Rs. 11,50,000/- as income from other sources and not as income from house property as claimed by assessee. Ld. CIT(A) confirmed the AO's action. Being aggrieved, the assessee is in appeal before me and has taken following grounds of appeal: "Ld. CIT(A)-XXVI, New Delhi has erred by passing ex-parte order u/s 250(6) of the Income Tax Act, 1961 without extending reasonable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2006 , clause 13 was substituted as follows: "To take on lease the demised premises on a monthly rent of Rs. 525000/- (Rs. Five lacs and twenty five thousands only). And this amount shall be divided into two components namely lease charges - Rs. 237500/- and Maintenance charges Rs. 287500/-. Each of the lessor shall be entering into separate maintenance agreements with the lessee." 9. He, therefore, submitted that mere nomenclature was given to the enhanced rent as maintenance and service charges. 10. Ld. counsel has also referred to the decision of ITAT in the case of Suguna Kaur Vs. ACIT (ITA no. 4117/Del/2012), wherein the ITAT , inter alia, has observed as under:- "...... In our considered view, character of income cannot be change ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 26-12-2006 as amended by addendum dated 1-4-2008 has to be considered in entirety. As regards the maintenance and service charges, clauses 16 & 17 of agreement dated 26-12-2006 read as under: "16. To Pay actual maintenance and service charges in respect of the above premises directly to the maintenance Society of the building (in addition of the monthly rent). 'Such payments shall be deemed full settlement of the Lessee's Obligation -towards any charges or common facilities like running cost of lifts, lighting, common space, staircase, ground cleaning, maintenance of lawns or parking etc. Any enhancement of the same shall be borne by lessee. 17. The said maintenance charges shall be paid on the basis of the actual amount d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts it is evident that there is marked change in the terms of agreement and, therefore, it cannot be held that the entire receipts were towards rent. In the original agreement as per clause 16, the maintenance chares were paid to the society of the building hired by lessee which was in full settlement of the lessee's obligation towards any charges for common facilities running cost of lifts, lighting, common space, staircase, ground cleaning, maintenance of lawns or parking etc. Any enhancement of the same was to be borne by lessee. However, in the amended agreement the lessor took the responsibility for repair and renew, paint, whitewash and colour the building in the demised premises. Earlier also the maintenance and service charges paid t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tutory deduction claimed u/s 24(a) should not be allowed from income from provision of amenities and services. Therefore, vide order sheet entry dated 01.12.2011, counsel was asked to explain:- "Explain why the income from "Service agreement" for Mumbai property should not be treated as income from other sources and therefore 30% statutory deduction should be disallowed. " 13.1. The assessee's submission was that both agreements were inextricably inter related and, therefore, the entire sum received was to be treated as income from house property, which plea was not accepted by department. Tribunal after considering the entire facts observed as under: In our considered view, character of income cannot be changed either by entering two ag ..... X X X X Extracts X X X X X X X X Extracts X X X X
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