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TMI Blog2022 (2) TMI 426X X X X Extracts X X X X X X X X Extracts X X X X ..... of depreciation on factory building - The entire income which accrued and was assessed was from letting out of these properties and there was no other income of the assessee except the income from letting out of these two properties. Therefore in M/S CHENNAI PROPERTIES INVESTMENTS LTD [ 2015 (5) TMI 46 - SUPREME COURT] has held that the rental income earned by the assessee cannot be treated as Income from the house property . Whereas, in this case, the assessee is engaged in manufacturing of automobile components and let out 50% of its factory building on lease and earned rental income. CIT(A) has rightly held the rental income as income under the head house property . Having the rental income held as income under the head house prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for signing the Form 35, who was out of the country, the ld. Counsel for the assessee prayed for condoning the delay in filing the appeal before the ld. CIT(A) and may be directed the ld. CIT(A) to adjudicate the case on merits by affording an opportunity of being heard to the assessee. 3. On the other hand, the ld. DR has not raised any objection. 4. We have heard both the sides, perused the materials available on record and gone through the orders of authorities below. On perusal of the appellate order, we find that there was delay of 44 days in filing the appeal before the ld. CIT(A) for which the assessee filed a condonation petition stating that the authorised person for signing Form 35 was out of India for last 2 months due to s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. However, the above ground was not raised before the ld. CIT(A). In this case, the return of income for the assessment year 2011-12 was filed on 28.09.2011 admitting a loss of ₹.23,59,601/-. The return was processed under section 143(1) of the Act. After recording reasons, the Assessing Officer issued notice under section 148 of the Act dated 27.03.2015 for reopening of assessment. In response to the notice, the assessee s AR filed a letter dated 09.04.2015 stating that the return of income filed for the assessment year 2011-12 on 28.09.2011 may be treated as the return of income filed in response to notice under section 148 of the Act. After following due process, the Assessing Officer has completed the assessment order under se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etting out the factory building in the company s hand for the assessment year 2011-12. As per lease deed dated 11.05.2009, M/s. Vinay Autoparts Pvt. Ltd. and M/s. Ushas Auto Gears Private Limited have taken on rent the 50% of assessee s factory building from May 2009 onwards, the Assessing Officer was of the opinion that the assessee was using only 50% of the balance factory building and thus, the assessee is eligible for 50% of depreciation on factory building. Accordingly, the Assessing Officer restricted the claim of eligible depreciation to 50% and the balance claim was brought to tax. Further, the assessee company had offered the rental income of ₹.9.30 lakhs as income from other sources. However, on verification of the lease dee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is denied depreciation. Having the rental income held as income under the head house property , the assessee is not eligible for claim of depreciation. The ground of appeal on the issue is therefore dismissed. We have gone through the judgement relied upon by the assessee in the case of Chennai Properties and Investments Limited 373 ITR 673 (SC), wherein, the main object of the assessee-company, as stated in its memorandum of association, was to acquire and hold the properties known as Chennai House and Firhavin Estate both in Chennai and to let out those properties as well as make advances upon the security of lands and buildings or other properties or any interest therein. The entire income which accrued and was assessed w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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