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At the outset, it is noticed that the CIT-A by passing ex parte orders in all the cases confirmed the impugned additions made in the respective assessment order made u/s. 147/144/143(3) of the Act by the AO. It is also observed that the assessee has been given many opportunities to substantiate its claim in treating the ‘lease rental income’ received by the assessee as ‘income from business’.
Before us the ld.AR submits that during the course of assessment proceedings for the A.Y 2004-05 the AO raised a query in claiming rental income as business income by the assessee. The AO assessed the same as income from House Property. Thereby the AO reopened the assessments for all the earlier and subsequent A.Ys. Accordingly, for all the assessment years under consideration except the A.Y 2004-05, the AO passed the assessment orders u/s. 147/144 of the Act treating the lease rental income received by the assessee as ‘income from house property’ against treating the same as ‘Business Income’ by the assessee. For the A.Y 2004-05 the AO passed the assessment order u/s. 143(3) of the Act treating the lease rental income received by the assessee as income from house property as against business income treated by the assessee, wherein the AO treated the lease rental income being taxable under the head ‘Income from House Property’. For the A.Ys 2004-05 and 2005-06 the AO enhanced the receipt of rental income, made additions u/s. 68 of the Act and did not allow the unabsorbed depreciation and for the rest of A.Ys under consideration while the AO passed the assessment orders u/s. 147/144 of the Act treated the lease rental income received by the assessee as ‘Income from House Property’ and disallowed other deductible expenditure which are allowable under the head ‘Business Income’. However, such action of the AO in making various additions was confirmed by the CIT-A in all the cases in the absence of assessee.
Before us the ld.AR submits that the issue in hand is covered by the decisions of the Hon’ble Supreme Court in the cases of Chennai Properties & Investments Ltd Vs. CIT in Civil Appeal Nos.4491- 4494 of 2004 and Rayala Corporation Pvt. Ltd Vs. ACIT in Civil Appeal Nos.6438-6441 of 2016. [Copy of these orders placed on record]. We find that such contention of the assessee was not available before the AO for his consideration. Accordingly, we deem it fit and proper to remand the issues involved in all the appeals including the ground nos. 7 to 9 raised in & 2018/Kol/2016 for the A.Ys 2004- 05 & 2005-06 to the file of the AO to decide the issue(s) involved in all the appeals in the light of above judgments as relied on by the assessee and to pass an appropriate order as per law after giving the assessee adequate opportunity of hearing to both the parties. The assessee shall be at liberty to file the requisite evidences to substantiate its claim.
In the result, all the appeals filed by the assessee are allowed for statistical purpose.