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2015 (5) TMI 1229 - AT - Income TaxIncome from running and managing an IT Park - assessed under the head “income from business” or “income from house property” - HELD THAT:- Income of the assessee from renting of I.T. Park is to be considered as ‘business income’ only and the interest expenditure incurred by the assessee for the purpose of business to be allowed u/s.36(1)(iii) - It is seen that the AO treated the income of the assessee under the head “income from house property” and he has not examined other provisions of Act as applicable while computing the income under the head “business”. If there is diversion of borrowed funds as alleged by the DR, the AO shall point out the same and that portion of the interest to be disallowed, as it is not incurred for the purpose of business. We deem it fit to remit the issue back to the file of the Assessing Officer to decide the same afresh. Accordingly, we remit this issue back to the file of the Assessing Officer to reframe the assessment after considering the relevant provisions of the Act, as applicable while computing the income under head “business”. The grievance of the assessee is with regard to confirming the assessment of income earned from operations of running the IT Park and providing IT infrastructure under the head “income from house property” instead of under the head “income from business or profession”. We have already held for the assessment years 2007-08 and 2008-09 that the income of the assessee from renting of I.T. Park is to be considered as ‘business income’ only and the Assessing Officer is directed to reframe the assessment in accordance with law. Accordingly, the cross objection is allowed for statistical purposes. Deemed dividend - Amount available in share premium account cannot be treated as accumulated profits for the purpose of applying the provisions of sec.2(22)(e) - HELD THAT:- We find that similar issue was considered by this Tribunal in the case of ACIT v. M/s. RR Industries Ltd. [2018 (7) TMI 1321 - MADRAS HIGH COURT] has observed that the balance in the share premium account cannot be considered as accrued for the purpose of application of provisions of sec.2(22)(e) of the Act. In view of the above order of the Tribunal, we are inclined to decide the issue in favour of the assessee and this ground of appeal of the Revenue is dismissed.
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