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2015 (12) TMI 388 - ITAT DELHI

2015 (12) TMI 388 - ITAT DELHI - TMI - Accrual of income - receipts of amount by sister concerns of the assessee as maintenance charges - whether lease agreement entered into between the assessee company and its tenant was a colourable devise to divert receipts/income to the other company to avoid tax liability in its hands - CIT(A) deleted the addition - Held that:- It is not in dispute that both the assessee company and its subsidiary company, providing maintenance services to the tenant of th .....

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t maintenance charges, whatsoever, were paid by the tenant to another company namely, M/s. IHDP Home Interiors Exports Parks Pvt. Ltd. under a separate agreement. It is also not in dispute that the lifts, generator, fire equipments etc. installed in the premises were not owned by assessee company, but by the other company who rendered maintenance services and received the maintenance charges

CIT(A) appears to have committed no error while holding that there is no reason to include the .....

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rected against the order dated 23.04.2012 of ld. CIT(A), Meerut for the assessment year 2009-10 on the following grounds : 1. Whether in the facts and circumstances of the case, the Ld. CIT(Appeals) has erred in law in deleting the addition of ₹ 2,72,74,672/- ignoring the facts that the relevant clause in lease agreement entered into between the assessee company and its tenant was a colourable devise to divert receipts/income of ₹ 2,72,74,672/- to the other company to avoid tax liabi .....

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of the assessee as maintenance charges in fact emanated from agreement between assessee and its tenants and thus was a part and parcel of receipts in the hands of the assessee. 2. The Brief facts of the case are that the assessee company is a holding company of M/s. IHDP Home Interior Export Parks Private Limited and 100% share capital of subsidiary company/sister concern is held by the assessee company and both the directors are common. The assessee company enjoyed rental income of ₹ 17,1 .....

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rt Parks Private Limited provided various services and maintenances to the tenant and received a sum of ₹ 2,72,74,672/- for the services rendered as per another agreement dated 25.08.2008 entered into between M/s. IHDP Home Interior Export Parks Private Limited and the user of property, M/s. Bell Woven Company India Pvt. Ltd. The tenants paid rent to the assessee company and separately paid maintenance charges to subsidiary company M/s. IHDP Home Interiors Exports Parks Pvt. Ltd. The AO co .....

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the tenants of the premises. He therefore, considering the law laid down in the cases of Durga Prasad More, 82 ITR 540(SC) and CIT vs. McDowell, made the impugned addition to the income of the assessee. Aggrieved assessee challenged the assessment order before the ld. CIT(A), who deleted the impugned addition observing as under : I have gone through the assessment order and submissions of AR and the papers and documents placed during the assessment proceedings, the copies of which were also pla .....

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ted the bare Building at plot No. 7 Sector 127, Taj Express Way, Noida and charged rent for the land and bare construction of the building through agreements entered into between the appellant company and the tenants. The appellant company was not in a position to give any maintenance services to its tenants as the necessary assets and equipments, such as lifts, generator etc. were not owned by the appellant company and that all the necessary assets and equipments such as Lifts, Generators, Air .....

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IHDP Home Interior Export Parks Private Ltd. as well as the statement of Income and Income Tax Return filed by namely IHDP Home Interior Export Parks Private Ltd. for A.Y. 2009-10 and the assessment order passed u/s. 143(3) for A.Y. 2008-09 while passing the assessment order of the appellant company. It appears that it has not been done by AO. Considering the legal and factual position, I am of the considered opinion that on the facts and circumstances of the case, there is no reason to include .....

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f the assessee. It was submitted that the ld. CIT(A) while deleting the addition, did not consider this aspect of the case and deleted the addition without any good reason. The learned counsel for the assessee, on the other hand, relied on the order of the first appellate authority and urged for dismissal of Revenue s appeal. 4. We have considered the rival submissions, perused the orders of the authorities below and the material available on record. It is not in dispute that both the assessee c .....

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into between the assessee company and the tenants. It is also born out on record that maintenance charges, whatsoever, were paid by the tenant to another company namely, M/s. IHDP Home Interiors Exports Parks Pvt. Ltd. under a separate agreement. It is also not in dispute that the lifts, generator, fire equipments etc. installed in the premises were not owned by assessee company, but by the other company who rendered maintenance services and received the maintenance charges. It is also worthwhi .....

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