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TMI Blog2022 (8) TMI 960X X X X Extracts X X X X X X X X Extracts X X X X ..... forward but backward also. Court can presume that such state of affairs might have existed in past also unless discontinuity is proved. In the instant case, it is found that the building in question is a structure, not fit for residential house, but to exploit the same for commercial usage. Absolutely, there is no affirmative evidence on record to show that originally, the plaintiff constructed the building as a residential building but subsequently, it was converted into a hostel at the request of the lessee. The contention of the assessee that the tenant used the property according to their convenience is also appears to be not acceptable because by way of agreement the lessee was prevented from making any additional alterations or structural changes of any kind whatsoever in such building. It is therefore clear that even before the building was let out on lease, the structural changes were made to make it suitable for running a hostel. As we held in the preceding paragraphs that the need to have such a huge building for a single dwelling unit is not established, and at the same time the demarcation for multi-dwelling units is not possible in the structure of the building. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red agricultural income of Rs. 3,12,500/-. Assessment under section 143(3) of Act was complete by order dated 31/12/2011 denying the claim of the assessee for exemption under section 54F and 54B of the Act. Learned Assessing Officer also did not allow the cost of acquisition of land in respect of the above said property and restricted the agricultural income to Rs. 20,000/- per acre and accordingly brought to tax an amount of Rs. 1,51,100/- as income from other sources. 3. Aggrieved by such an order, assessee preferred an appeal and the Ld. CIT(A), vide order dated 28/12/2012 partly allowed the claim of the assessee for exemption under section 54F to the tune of Rs. 85,20,500/- by restricting it to 50% of the claim. Ld. CIT(A) also allowed the claim of the assessee for exemption under section 54B of the Act to the tune of Rs. 31,68,790/-. Insofar as the disallowance of agricultural income of Rs. 1,51,590/- is concerned, Ld. CIT(A) upheld the addition made by the learned Assessing Officer. 4. Revenue carried the matter in appeal to the Tribunal challenging the relief granted to the assessee under section 54F and 54B of the Act, whereas the assessee filed an appeal challenging ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... details of exact nature of trade allowed by the municipal department to be carried in that building. to furnish the details of your family members. If the family consists of 04 to 05 members where is the need for you to construct such a big House consisting of Ground + Four Floor along with Penthouse. To substantiate for construction of such a big building with a built-up area of 23000 Sft. (Approximately), which comprises of Open Hall Dining Hall Kitchen Staircase. So many bathrooms in each floor, and Seven large rooms in each floor. To furnish the details of residential house owned by the appellant as on the date of construction Where exactly the appellant was residing since the date of construction. Why the loan specifically was taken from M/s Narayana Education Society. 6. Learned Assessing Officer recorded that except reiterating their original stand that the building in question was constructed for residential purpose, photographs would establish the same, the building is located in predominantly a residential area with all the facilities necessary for a residential building, assessee did not furnish any of the information sought by the learned Assessi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... qualified for deduction under section 54F of the Act the building may not be in a single residential unit but it could comprise of more than one residential unit is concerned, absolutely there is no dispute. Even Revenue also does not challenge the same. What all the Revenue contend is that even initially the building was constructed as a commercial property for commercial exploitation and not for residential purpose. Revenue contends that residential building presupposes the dwelling of human beings in juxtaposition to temporarily residing in a hotel or hostel or a hospital. 11. It could be seen from the record that althrough the proceedings, the Revenue s contention is that the physical characteristics of the building were such that the building was a commercial building and not a residential building, no person would construct such a huge building with four floors, so many rooms, big halls, 25 wash basins, 25 lavatory basins, underground sump capacity of 2000 litres and over head tank with a capacity of 50,000 Liters for a single dwelling unit. The structure of the building also does not suggest that it is fit to be a multi-dwelling units, because the distribution of the room ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led to furnish such a reason as to why such loan was taken specifically from an educational institution. 14. It is not the case of the assessee that at any point of time the assessee resided in the building in dispute. If really the original construction of the building was for the purpose of human dwelling in its proper sense, the distribution of the halls, rooms, kitchens and the sanitary facilities would be in a particular order for each dwelling unit. If the entire building was intended to be used as a single dwelling unit, there must be a reason for the assessee to construct such a huge building in four floors, with very big kitchens, dining halls, rooms and 25 wash basins and 25 lavatory basins. The water storing capacity is also disproportionate to the normal usage of a dwelling unit. Demarcation of various dwelling units in the building in question is not at all possible, even if we believe that the building in question comprises of more dwelling units than one. Having regard to the hugeness of the building and the facilities available, it is not possible to believe that it was intended to be used as a single dwelling unit. 15. Record speaks that the learned Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al changes were made to make it suitable for running a hostel. As we held in the preceding paragraphs that the need to have such a huge building for a single dwelling unit is not established, and at the same time the demarcation for multi-dwelling units is not possible in the structure of the building. When we look at this fact from the angle of the assessee and for that matter anyone used the building for residential purpose at no point of time, coupled with the fact that the assessee obtained the loan from M/s Narayana Educational Society even before the building is complete shows that the construction of the building itself was for commercial purposes. The lessee is prevented by way of agreement from making any structural changes and also that the lessee shall obtain requisite permission of the concerned authorities for carrying out the business at such premises at their own cost from time to time. All these things cumulatively lead to the inference that the assessee constructed the building for commercial purposes only. The findings of fact recorded by the authorities below do not warrant any interference and we accordingly uphold the same. Consequently we find the grounds of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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