2012 (6) TMI 904

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..... holding 26% stake in the equity. The balance is held by EMAAR through its subsidiary. APIIC has allotted approximately 235 acres of land on leasehold basis for a period of 66 years to the assessee. The lease deed mentions that the assessee has to create buildings, permanent and semi-permanent for sports/recreational facilities including golf academy, diving range, golf club house and country club on the leased land. As per para 4 of the lease deed assessee has to pay lease rent to APIIC as under:- a) 2% of gross annual revenue for 33 years b) 3% of gross annual revenue for 33 years Gross annual revenue is defined in the lease deed as revenue generated by assessee from various golf course components (including the club house) but excludi .....

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..... id not disallow personal, administrative and other expenses. During the course of assessment proceedings the assessee had filed a detailed note with regard to business activity vide letter dated 05/10/2009 wherein it was stated that the assessee was engaged in developing, designing, maintaining and operating a golf club house at Boulder Hills besides other rercreational facilities. 5. The CIT u/s 263 of the Act, held that the order of the Assessing Officer was erroneous as well as prejudicial to the interests of the revenue and the assessment is to be set aside for the verification on the issues relating to the claim of depreciation, expenditure that is to be capitalized, expenditure that is to be considered as prior period expenditure, ex .....

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..... of depreciation 3,68,93,017/- and determined loss of ₹ 2788761/-. This loss of ₹ 27,88,761/- has been arrived at after taking into account income of interest from deposits being 1,11,39,164/-. It is to be noted that the assessee itself in the computation of income has claimed 1,11,39,164/- under the head 'income from other sources' and, hence, the applicability of the apex court judgement in 227 ITR 172 in the case of Tuticorin alkalis chemicals has been rightly applied by the CIT in his order u/s 263. Hence, we confirm the order of the CIT passed u/s 263 and dismiss the assessee's appeal. 10. In the result, appeal of the assessee is dismissed. Pronounced in the open court on 08/06/2012.
Case laws, Decisions, Judgements, .....

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