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TMI Blog2017 (7) TMI 1351X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the assessee is that the ld. CIT(A) has erred in confirming the franchise fees claimed under section 24 of the Income Tax Act, 1961 ["Act" in short]. 2. Brief facts of the case are that the assessee has filed its return of income on 30.10.2007 for the assessment year 2007-08 admitting a total income of Rs..2,97,35,950/-. The return filed by the assessee was processed under section 143(1) of the Act on 11.02.2009. Subsequently, the assessment was reopened under section 147 of the Act by issuing notice under section 148 of the Act dated 31.03.2014 by recording reasons for reopening of the assessment. Based on the submissions made by the assessee and after verification of materials available on the records, the Assessing Officer has co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowing the decision of Hon'ble High Court in the assessee's own case, the Assessing Officer disallowed Rs..59,38,329/- and brought to tax. On appeal, by following the decision of the Hon'ble Jurisdictional High Court in assessee's own case, the ld. CIT(A) confirmed the addition made on this account, wherein, the Hon'ble High Court has observed as under: "13. As is evident from the various clauses in the above agreement, the assessee has not leased out the property merely as a land and building, but also with further conditions as to how the business of the lessees/ franchisees should be conducted with regard to the hotel industry only. The Special conditions of contract make it clear that the name of the assessee should clearly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the property was in the nature of the business of the assessee company." 16. In this case, we find that the assessee has given a special right or privilege to the franchisees to undertake a particular business in the property of the assessee on receipt of franchisee fee. Therefore, the income is clearly in the nature of business income and not income from house property. Hence, the decision reported in (2008) 300 ITR 118 (Mad)(Keyaram Hotels (P) Ltd. V. Assistant Commissioner of Income Tax) does not applicable to the facts of the case. 17. We find that the reasoning of the Tribunal is justified in the facts of the case. Accordingly, we find no question of law much less any substantial question of law arises for consideration, i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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