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2023 (6) TMI 1216 - AT - Income TaxNature of receipts - non-refundable security deposits received by appellant - nature of security deposits - revenue or capital receipt - As per AO security deposits are not shown as advance receivables at the asset side nor shown as liability towards customers in the balance-sheet of M/s Silver Line Holdings Pvt. Ltd. and that without passing the amount through its account M/s Silver Line Holdings Pvt. Ltd. transferred the same to the assessee, thus has to be considered to be non-refundable - HELD THAT:- In the light of various clauses of Tripartite agreement and the agreement between the assessee and SHL discussed above it is established that both the companies were operating in different fields of the project. The rights in the land vested with SHL along with other subsidiaries and they were transferred in favour of any buyer of Villa/ Units and qua service or amenities of Gold Course, SHL was separately charging non-refundable deposits. It was responsibility of SHL to account for the same in books for which assessee cannot be faulted. Ld. tax authorities below have completely ignored the corrigendum agreement dated 29.09.2009, considering the same to be self serving ignoring that other clauses of tripartite Buyer’s agreement and agreement between assessee and SHL dated 24.12.2008 were themselves clear of the fact that what assessee was getting was something in the form of refundable deposit . CIT(Appeals) has rightly concluded non-refundable security deposits received by appellant has nexus with O&M services provided to the clients. However, he failed to appreciate that in the hands of assessee the same were refundable and merely as means to finance O&M services. Thus, the same were not of revenue nature receipts. Apart from above, there is also force in the contention of learned AR that the Coordinate Bench in assessee’s own case, [2019 (7) TMI 1434 - ITAT DELHI], has considered the nature of deposits in the hands of assessee as refundable security deposits, as one of the possible view as decided in favour of assessee.
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