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Income Tax Appellate Tribunal, MUMBAI BENCH “ A”, MUMBAI
This appeal by the Revenue is directed against the order of Commissioner of Income Tax(Appeals)-2, Mumbai [in short 'the CIT(A)’] dated 13/01/2020 for the assessment year 2014-15.
Shri Mehul Jain representing the Department submitted that the solitary issue in the present appeal is whether the lease rental income from industrial park is assessable as Business Income or Income from House Property. The assessee has offered lease rental income of Rs.7,63,04,900/- from infrastructure facility in industrial park as Business Income. The Assessing Officer after examining the facts held that the assessee had purchased industrial park from M/s.Akruti Nirman Ltd. but the operation and maintenance of industrial park were not been transferred to the assessee. Therefore, the lease rental income is only from letting of the premises and not providing operation and maintenance of industrial park. In the facts of the case the Assessing Officer has rightly held that lease rental income is assessable under the head Income from House Property. The CIT(A) has allowed assessee’s claim of lease rental income as Business Income by following the order of Tribunal, in assessee’s own case in for assessment year 2010-11 decided on 04/09/2018. The ld.Departmental Representative asserted that though the issue seems to be covered by the order of Tribunal, however, there is a distinction in the impugned assessment year. The Assessing Officer has given categorical finding that M/s. Akruti Nirman Ltd. has not transferred operation and maintenance of the industrial park to the assessee. This fact was not brought to the notice of Tribunal in preceding assessment years.
We have heard the submissions made by ld.Departmental Representative and have examined orders of authorities below. We have also considered the decision of Co-ordinate Bench of the Tribunal in assessee’s own case in cross appeal by the Revenue in for assessment year 2010-11. We find that in assessment year 2010-11 the CIT(A) accepted the claim of assessee in treating lease rental income as Business Income, as against the stand of the Assessing Officer in treating the same as Income from House Property. The Revenue carried the issue in appeal before the Tribunal. The Co-ordinate Bench dismissed this ground of appeal by Revenue by observing as under:
“9. We have considered rival submissions and perused material on record. We have also applied our mind to the judicial precedents cited before us. The factual matrix arising from record reveals that the disputed lease rental income was received by the assessee from a IT park at Suburban Mumbai. It is also a fact that the said IT Park initially belonged to another entity and was notified as an infrastructure facility eligible for deduction under section 80IA(4)(iii) of the Act. Though, on purchase of the said IT park, the assessee did not get the benefit of deduction under section 80IA of the Act, however, there is no dispute that the assessee is engaged in operating and maintaining an infrastructure facility. That being the case, the income derived from operation and maintenance of the IT Park certainly partakes the character of business income. This fact has been clarified by the CBDT, vide Circular no.16 of 2017, dated 25th April 2017. Even, otherwise also, facts on record reveal that the assessee is consistently claiming the lease rental income from IT park as income from business. The aforesaid claim of the assessee was accepted by the Assessing Officer in the assessments completed under section 143(3) of the Act in the assessment years 2009-10 and 2011-12. Even, in the original assessment completed under section 143(3) of the Act for the impugned assessment year also/ the Assessing Officer had accepted assessee's claim. Notably, while completing the assessment under section 143(3) of the Act for the assessment year 2012-13, the Assessing Officer treated the income from lease rental as income from other sources. However, while deciding assessee's appeal for the said assessment year, learned Commissioner (Appeals) accepted assessee's claim of lease rental income as business income. It is also evident, the aforesaid decision of learned Commissioner (Appeals) has been accepted by the department. More importantly, the assessment order passed under section 143(3) of the Act for Assessment Year 2012-13 was revised under by the learned CIT on identical reasoning on the basis of which he passed the order under section 263 of the Act for the impugned assessment year. However, while deciding assessee's appeal in the order referred to above, the Tribunal quashed the order passed under section 263, of the Act and accepted assessee's claim of lease rental as business income. Thus, applying the rule of consistency also, assessee's claim of lease rental as income from business and profession has to he accepted. In view of the aforesaid, we do not find any infirmity in the order of learned Commissioner (Appeals) on the issue. This ground is dismissed”
We find that in the preceding assessment years i.e. assessment year 2009-10 and 2011-12 the assessee offered lease rental income from industrial park under the head Business Income. The same was accepted by the Assessing Officer. In assessment year 2010-11 the Tribunal has decided the issue in favour of the assessee holding lease rental income from industrial park assessable under the head Income from Business and Profession. In the impugned assessment year there is no change in the facts of the case. Hence, we see no reason to take a divergent view
The ld.Departmental Representative has tried to distinguish fact in the impugned assessment year by pointing that the Assessing Officer has given a finding that operation and maintenance of the industrial park was not transferred to the assessee. We find that though the Assessing Officer has mentioned this fact, however, there is no document or evidence on record to support the findings of Assessing Officer. Hence, the argument raised by the ld.Departmental Representative is rejected as unsustainable.
In the result, impugned order is upheld and appeal of the Revenue is dismissed.
Order pronounced in the open court on Friday the 13th day of May, 2022.