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TMI Blog2023 (6) TMI 518X X X X Extracts X X X X X X X X Extracts X X X X ..... amenities being part of permanent structure of the property and treating the rent received under the head income from other sources. The learned AR submitted that the assessee claimed the rental income from use the amenities as income from house property which was allowed by the Assessing Officer in AY 2012-13 and for AY 2013-14 the ld. CIT(A) allowed the appeal of the assessee and directing the Assessing Officer to treat the same as income from house property by following the judgment of Hon'ble Calcutta High Court in the case of CIT vs. Shambhu Investment P. Ltd. 249 ITR 47 (Cal.) therefore claim of assessee for immediately succeeding present assessment year 2014-15 under identical facts and circumstances deserves to be allowed. 4. The learned counsel precisely reiterated assessee's written submissions dated 02.03.2023 and submitted that as per various judgments and orders of Hon'ble Supreme Court & High Court and co-ordinate benches of the Tribunal including judgment in the case of Sultan Bros. Pvt. Ltd. vs. CIT 51 ITR 353, judgment of Hon'ble Karnataka High Court in the case of CIT vs. Velankani Information Systems P. Ltd. 265 CTR 250 (Kar.) and orders co-ordinate bench of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ximate value of the Common Amenities and Facilities as described in Annexure "D" and the appropriate value of the fittings and fixtures specifications as per details given in Annexure "E" 3. The said flat along with amenities was initially let out to Tata Sky Limited and rent received therefrom, was offered to tax under the head "Income from House Property" in the Return of Income for A. Y. 2012-13. 4. Likewise, after expiry of the tenancy with Tata Sky Limited, the assessee entered into a Rent Agreement with Mr. Vikram Kaushik (referred hereinafter as "Lessee") vide Rent Agreement dated 09.05.2011, fixing the rent for use of premises at Rs.1,70,000/- per month. 5. In addition to the said Rent Agreement for use of premises, the assessee also entered into a simultaneous agreement of even date i.e. 09.05.2011, with the same Lessee for use of amenities in the premises, fixing the rent of Rs. 1,60,000/- per month. The amenities forming integral part of the property were mentioned at Annexure-A of the use of amenities agreement. Refer Page 11 of the supplementary Paper-Book, which is reproduced hereunder for ready reference: "Annexure 'A' - Agreement for Provision of Ame ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer in assessment for Assessment Year 2013-14, in the impugned assessment order for A.Y. 2014-15 also, the Assessing Officer adopted a similar stand of treating rental income from use of amenities as 'Income from Other Sources' instead of Income from House Property', thereby resulting in disallowance of Standard Deduction of 30% amounting to Rs.5,76,000/- claimed by the assessee under section 24(a) of the Act. 11. On further appeal, the CIT(A) unlike the order for the last Assessment Year i.e., A.Y. 2013-14, took a different stand and upheld the action of the Assessing Officer in treating rental income from use of amenities as Income from Other Sources'. The CIT(A) distinguished the cases relied upon by the assessee to the effect that the premises and amenities were inseparable, as one cannot be used without the other, on the ground that the rent agreement in the case of assessee was separate. 7. On being asked by the bench the learned Senior DR in all fairness, submitted that to the best of his knowledge there is no any further action by the department in AY 2012-13 & 2013-14 on account of claim of assessee allowed by the Assessing Officer and ld. CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee as 'income from house property' and income from business. He has treated the entire income i.e. as 'income from house property'. Admittedly, the authorities have the freedom to go beyond the documents to find out the real intention of the parties. In this case, though there is two agreements the real intention of the parties to a document is different what appears from it ex facie. Since there is a doubt, then the assessing officer is justified in going beyond the documents to find out real intention of the parties by ignoring the apparent has to be and has always been conceded. In this circumstance, the assessing officer has to remove the façade to expose the real intention of the parties cleverly cloaked and the actual agreement cannot be given effect. The only bona fide document to be acted upon not otherwise. There is a serious doubt and also it is shocking the conscious of the Bench, whether the assessee is getting hire charges equal to the rental amount for providing amenities. It cannot be real one and assessing officer required to see the actual rental value of the property in that place and bring that amount into tax under the head 'income from house p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... intention of the assessee whether the letting was the doing of a business or to exploitation of his property by an owner. The assessee when exploited the property to derive rental income it has to be held that the income realized by him by way of rental income from a building if the property with other asset attached to the building to be assessed as 'income from house property' only. The only exceptions are cases where the letting of the building is inseparable from letting of the machinery, plant and furniture. In such cases, it has to be held that the rental would not have been realized but for the letting out of the machinery, plant or furniture along with such building and therefore, rental received for the building is to be assessed under the head 'income from other sources'. In the present case, on the facts of the case, it is clear that the assessee as the owner of the building was only exploiting the property as owner by letting out the same and realizing income by way of rent. Such rental income was liable to be assessed under the head 'income from house property.' The various assets let out to the tenants are incidental to letting out the building being integral part of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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