2009 (5) TMI 504

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..... aforesaid interest income on account of expenses incurred towards maintenance was, however, not accepted. 2. Dissatisfied with the order passed by the Assessing Officer dated March 23, 2001, the respondent-assessee preferred an appeal before the Com-missioner of Income-tax (Appeals), Faridabad. The aforesaid appeal was, however, dismissed on June 4, 2004. 3. Aggrieved with the orders passed by the Revenue authorities dated March 23, 2001, and June 4, 2004, the respondent-assessee preferred a second appeal before the Income-tax Appellate Tribunal (Delhi Bench "F"). The Income-tax Appellate Tribunal accepted the appeal preferred by the respondent-assessee and allowed him deduction on account of expenses incurred towards maintenance from ou .....

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..... Revenue is limited to the income earned by the respondent-assessee. In case, the members of the society desire to assail the action of the respondent-assessee carrying out activities beyond the objects and reasons it is for them to do so. As already stated hereinabove, the limited scrutiny at the hands of the Revenue, in so far as the activities of the respondent-assessee are concerned, is to determine the income drawn by the respondent-asses-see. Undoubtedly, the respondent-assessee has drawn income on account of interest based on deposits made by the members of the respondent-assessee for maintenance of their houses and as such liability of the respondent-assessee to pay tax on the same cannot be doubted, but since the activity on which t .....

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..... y must be treated as part and parcel of the contractual agreement between the members of the society and the respondent-assessee. Thus viewed, we are satisfied that the Income-tax Appellate Tribunal was fully justified in allowing deduction on account of expenses incurred towards maintenance of houses by the respondent-assessee. At this stage, it would also be necessary to notice that the Revenue is stated to have acknowledged the fact that expenses were incurred by the respondent-assessee towards maintenance in furtherance of the deposits made by the members of the society to the respondent-assessee. The aforesaid acknowledgment has not been disputed even during the course of hearing before us. 9. For the reasons recorded hereinabove, we .....

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