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2015 (9) TMI 1562 - AT - Income TaxRental income earned from leased premises - assessed as income from ‘House property’ or as ‘Business income’- Held that:- The assessee’s objects are not in respect of letting of any particular property, but it has the main objects of acquiring, constructing, operating and maintaining of the multiplexes, business center, I.T. Parks, software zones, commercial & residential complexes and to grant the same on lease/license also. The very object is the commercially exploitation of the properties. Besides that the assessee is also providing hosts of amenities and facilities, as discussed above, which amounts to composite business activity. We therefore hold that the income/loss from the multiplex is liable to be assessed as ‘business income/loss and not as income from house property. The assessee consequently is also entitled to the claim of deductions in respect of expenditure incurred and depreciation on assets etc. in relation to such income. Hence, we do not find any reason to deviate from the findings recorded by the Ld. CIT(A) on this issue. - Decided in favour of assessee. Interest on fixed deposits kept with bank - treated as business receipts or income from other sources - Held that:- Admittedly, the interest was earned from the bank receipts. The Ld. A.R. could not convince us as to how the interest earned on fixed deposits can be said to be business activity of the assessee. We do not agree with the finding of the Ld. CIT(A) that since the income from the letting out of the commercial complex has been treated as business income then the interest from FDRs is also to be treated as business income. The interest on FDRs has no relation with the business of letting out of the property of the assessee. This issue is accordingly decided against the assessee and in favour of the Revenue. Treatment of interest income - whether be assessed as ‘business income’ or ‘income from other sources’ - Held that:- As per the proposition of law laid down by the Hon’ble Jurisdictional High Court in the case of “Reliance Utilities and Power Ltd.” [2009 (1) TMI 4 - BOMBAY HIGH COURT] wherein it has been held that “if there be interest free funds available to an assessee sufficient to meet its investments and at the same time the assessee had raised a loan it can be presumed that the investments were from the interest free funds available.” The assessee had sufficient own funds and as per the law laid down by the Hon’ble Jurisdictional High Court (supra) the presumption will be that the advances were given out of the own funds. Considering the above submission of the assessee, we restore this issue to the file of the AO to examine whether the assessee was having sufficient own funds to meet the advances given to sister concerns, if the contention of the assessee is found to be correct then no disallowance would be attracted
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