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TMI Blog2023 (3) TMI 966X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee s business premises is situated at Olympia building which was exclusively for carrying out the assessee s business activity. By assuming that the rest of the properties were leased out by the assessee in which the assessee has received rental income inclusive of maintenance and the assessee has not shown any material evidence to prove that the assessee has not claimed double deduction u/s. 24 and section 57 of the Act. Neither the A.O. nor the ld. CIT(A) has looked into this aspect. The assessee has also not proved by any documentary evidence as how much maintenance the assessee is charging from the lessee for maintaining the area occupied by the lessee. In view of the same, we are of the considered opinion that the said appeal has to be remanded back to the A.O. for proper verification of the fact that the expenses claimed by the assessee pertain to the business activity of the assessee or relevant to the leased units. A.O. is directed to verify whether the maintenance expenses and other expenditures claimed by the assessee has not been claimed under income from house property as well as business income . A.O. is also directed to consider the claim of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee has offered receipts from licensing activities under the head income from house property and has also claimed standard deduction u/s. 24 of the Act. It is also observed that the A.O. has disallowed the expenses proportionately an amount of Rs.1,77,37,817/- out of the total expenses, amounting to Rs.2,13,93,603/- by considering the total project area of 1,28,760 sq. ft., the area of units related to licensing activity to 93,215 sq.t. was calculated for disallowance. The A.O. has considered the submission of the assessee that the assessee has suo moto disallowed a sum of Rs.36,55,786/- as disallowance on maintenance, thereby the A.O. made a disallowance of Rs.1,77,37,817/- and added the same to the assessee s total income. 4. The assessee was in appeal before the ld. CIT(A), challenging the assessment order passed by the A.O. 5. The ld. CIT(A) dismissed the ground of disallowance of deprecation, amounting to Rs.11,71,074/- for the reason that the assessee was not receiving any rent separately for furniture s and fixtures and that the said furniture s and fixtures on which depreciation was claimed is given on rent along with the premises rented out by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en allocated by the assessee and only expenses related to the units owned by the assessee or leased out are claimed as expenses. The ld. AR further contended that the expenses pertaining to sold out units have not been included in the said expenses. The ld. AR relied on the decision of the ld. CIT(A). 10. We have heard the rival submissions and perused the material on record. It is observed that from the assessee s submission that the assessee has constructed four commercial buildings named as Alfa, Delta, Olympia and Sigma. The assessee has stated that some of the units have been sold and the other have been retained by the assessee, out of which most of the units are leased out by the assessee and some of the units remained as stock-in-trade. The assessee submitted that the building by name Olympia in which the assessee s office premises is situated has been exclusively used by the assessee for which the expenses, pertaining to security, electricity, telephone, housekeeping and repair and maintenance are expended by the assessee. The assessee further stated that it had bifurcated the expenditure related to maintenance, property tax and other such expenses in the ratio of lease ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as business income for which the assessee has incurred expenditure pertaining to the rental units, the units held by the assessee and also the sold units. Though the assessee has given the bifurcation of the expenditure such as maintenance, property tax and other expenses pertaining to the said unit, the same was not considered by the A.O. The A.O. had disallowed the total expenses by calculating the total area of the project from the leased area and by reducing the suo moto disallowance made by the assessee and had worked out the disallowance to Rs.1,77,37,817/-. The ld. CIT(A), on the other hand, had deleted the said disallowance without bifurcating the expenses pertaining to the leased premises and those retained by the assessee without having licensed/sold units. The ld. CIT(A) has also held that the expenses relating to maintenance such as housekeeping, etc. are common expenses calculated for both the units leased and owned by the assessee and had stated that the same could not be segregated. The ld. CIT(A) has also held that the assessee has not debited expenditure pertaining to the sold units in the books of accounts of the assessee. On a perusal of the profit and loss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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