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2009 (9) TMI 970 - AT - Income TaxCharacterization of income - Disallowance of portion of house keeping charges treated as '' income from other sources'' - AO believed money received by the assessee is not genuine and at best he could receive only a sum being the charges for giving on hire, the table, sofa sets, etc. - Principle of consistency - the assessee is in the business of providing House Keeping services to various business associate concerns., activities are being carried out since 1998-99 and except providing services, no business was carried out by the assessee - CIT(A) deleted the addition - HELD THAT:- No case for interference in the order of the Learned CIT(Appeals) as AO has not doubted that what the assessee is receiving is income from business as part of it as has been so assessed by him. Only a part has been treated as income from “other sources”. Assessee has been assessed in the past on these receipts from “House Keeping Services” under the head “Business”. Facts remaining the same, the Revenue should take a consistent view. It has been so held in the case of CIT vs. Malbaro Polychem Pvt.Ltd.[2008 (9) TMI 193 - RAJASTHAN HIGH COURT], in the case of CIT vs. Moon Light Builders and Developers [2007 (1) TMI 173 - DELHI HIGH COURT] and CIT vs. Dineshkumar [2005 (1) TMI 12 - MADHYA PRADESH HIGH COURT].Thus, if the facts are not different, then view once taken should be followed in subsequent year also. If certain part of expenditure incurred by group concerns in receiving services from the assessee-company is not genuine or is excessive, then action is required to be taken in their hands. Assessee-company is showing the receipts in full as taxable income. There is no reason to either reduce it or change the head. The logic given by the AO in treating the part of the receipt as income from “other sources” is not comprehendible and does not create any logical difference between receipts taken under the head “business” and receipt taken under the head “other sources”. Following the rule of consistency, no such distinction should have been created and secondly, it does not at all affect the taxability of the receipt and tax imposed. Disallowance of depreciation - Depreciation cannot be disallowed whether the part of income is assessed under the head “business” or under the head “other sources” as under both the heads there is provision for allowing depreciation. When income is computed under the head “business”, depreciation is allowable u/s.32 as per Rules and when income is computed u/s.56 and income is of the nature of clauses (ii) & (iii) of section (1) of section 56, then deduction of the nature of that provided u/s.32(1) & 32(2) are to be allowed by virtue of section 57(2). The receipt shown by the assessee is fully taxable and has been so offered by the assessee. Order of the Learned CIT(A) is correct and, therefore, does not require any interference. Appeal of the Revenue is dismissed.
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