TMI Blog2017 (6) TMI 1153X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee were not considered while adopting the value of the plot. The Valuation Officer adopted the rates of the property towards higher side quoting the sale instances, which are not of similar land. Even otherwise, the points quoted/explained by the assessee were conveniently ignored. Thus, this ground of the assessee is allowed and the addition made on this count is directed to be deleted. - ITA No.1361/Mum/2011 - - - Dated:- 18-1-2017 - Shri Joginder Singh, Judicial Member, And Shri Manoj Kumar Aggarwal, Accountant Member For The Revenue : Shri Prakash Pandit For The Assessee : Ms. Anupama Singhla-DR ORDER Per Joginder Singh(Judicial Member) The assessee is aggrieved by the impugned order dated 29/12/2010 of the Ld. First Appellate Authority, Mumbai. The assessee has filed precise grounds of appeal out of which ground no.1 treating the club rent of ₹ 45,71,097/- as rental income and as such receipts falls under the head Income from house property against the claim of the assessee as business receipt, is concerned, the ld. DR, Ms. Anupama Singhla, contended that the impugned issue is covered against the assessee by order of the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I have already held that the appellant has not started the business activity as per its own objectives, as given in the Memorandum of Association. Hence, the AO has rightly held that this is not a case of exploiting the business assets. The property has been leased out to an educational institution as owner of the property. Hence the income is taxable under the head Income from House property . This ground of appeal is dismissed 5. Before us, the learned AR of the assessee has submitted that the part of the business premises was let out to MMTI Educational. Research Trust for a period of three years. The assessee surrendered the club and resort business and the part of its premises was let out for a temporary period in order to exploit the business premises till the development and construction work is completed. Therefore, the assessee was exploited the business asset for making the profit in that business. The assessee has been doing business from the other part of the business premises. He has relied upon the decision of the hon.Supreme Court in the case of Universal Plast Ltd. v. Commissioner of Income-tax reported in [1999] 237 ITR 454 (SC) as well as the decision of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcial exploitation of the commercial assets when the assessee suffered loss for consecutive two years. Therefore, the said decision is not applicable to the present case where the assessee has not all utilized the premises in question for its own business. Moreover, the Hon. Supreme Court has summarized the proposition at page 461 of the reporter as under : ( 1) no precise test can be laid down to ascertain whether income (referred to by whatever nomenclature, lease, amount, rents, licence fee) received by an assessee from leasing or letting out of assets would fall under the head Profits and gains of business or profession ; ( 2) it is a mixed question of law and fact and has to be determined from the point of view of a businessman in that business on the facts and in the circumstances of each case, including true interpretation of the agreement under which the assets are let out; ( 3) where all the assets of the business are let out, the period for which the assets are let out is a relevant factor to find out whether the intention of the assessee is to go out of business altogether or to come back and restart the same; ( 4) if only a few of the busin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal for Assessment Year 2005-06, in the case of assessee itself, we dismiss this ground of the assessee. It is pertinent to mention here that even, during hearing, the ld. counsel for the assessee fairly agreed that this ground is covered against the assessee. 3. The next ground pertains to adding a sum of ₹ 10,69,979/- being the difference between the sale consideration received by the appellant and the value computed by the Valuation Officer u/s 50C(2) of the Income Tax Act, 1961 (hereinafter the Act) for two plots of land, sold by the assessee while computing the capital gains. The ld. counsel for the assessee drew our attention to various pages of the paper book by contending that the DVO reduced the value of the property by relying of various sale instances and conveniently ignored the value of the adjacent plot. Our attention was invited to pages 92 to 95, 98 and 99 of the paper book by contending that the DVO relied upon the instances of the plots, which are of lower value, thus, contradictory stand was taken with respect to the plot of the assessee. It was pointed out that the method of valuation adopted by the DVO itself is wrong, however, in the case of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lluted by nallah and there is no proper approach road. The cost of development of land and creation of infrastructure was quite high. It was also explained that land at new Mumbai Pune Expressway was on more demand and the rates at the old road decreased. It was also contended that due to slow down in the economy, at the relevant time, the real estate sector was badly affected resulting into fall in land prices. It was explained that the sub-registrar/Valuation Officer did not consider these facts, while calculating the market value of the plot. In view of these facts, the business of the assessee was also claimed to be affected and to tide over the crisis, the land was sold at distress prices. It was contended that the figures of sale mentioned in the documents is the true market value of the property. We find that the matter was referred to the District Valuation Officer, vide letter dated 08/12/2009 and the valuation report was accordingly sent. In view of this factual matrix, we are of the considered opinion that market value depends upon so many factors like location of the plot, whether the plot is located on a highway or approach road or on a kachcha road, whether the plot i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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