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2014 (8) TMI 841 - AT - Income TaxInterest income to be treated as business income or income from other sources – Business of letting out property - Held that:- The borrowed amount has been lended to its sister concern - The amount was borrowed at the rate of 8.25% interest and the same was given at the rate of 11.03% interest - The intention is clear, the assessee was engaged in money lending business - the main object of the assessee company may not be money lending business but ancillary object clearly show that the assessee is engaged in financial activities - the income from interest should be taxed under the head profits and gains of business or profession - the AO is directed to treat the interest income under the head “Profits and Gains of Business or Profession – Decided in favour of assessee. Taxability of income from amenities under the head “Income from other sources” – Held that:- The assessee has entered into two separate agreements one relating to the rent of the leased premises and the other relating to the amenities - Relying upon CIT Vs. J.K. Investors [2012 (11) TMI 186 - BOMBAY HIGH COURT] - the service agreement is totally dependent upon the rent agreement considering the amenities to be provided by the assessee, which includes lift facility, security, common area facility, car parking etc. - all the amenities are part and parcel of the building which are necessary for the enjoyment of the building by the tenant and otherwise no tenant will occupy the building on lease and such amenities not only increase the cost of the building but also the rental income - the AO is directed to treat the income from amenities under the head “Income from House property and compute the income as per the provisions of law under the head “Income from House property – Decided in favour of Assessee.
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