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Asst t. CIT (OSD) -I, Range-4, Ahmedabad Versus Jay Infa Trade (P) Ltd., Jay House, Panchwati Circle, Ambawadi, Ahmedabad.

2011 (12) TMI 690 - ITAT AHMEDABAD

ITA No.80/Ahd/2011 - Dated:- 2-12-2011 - S/Shri D.K.Tyagi, JM and A. K. Garodia, AM. Appellant by :- Shri James Kurair, DR Respondent by:- None ORDER Per D. K. Tyagi, Judicial Member. This is an appeal filed by the Revenue against the order of ld. CIT(A) dated 15.10.2010. The Revenue has raised the following ground:- (1) The ld. CIT(A) has erred in law and on facts in deleting the disallowance of ₹ 81,82,775/- made by the AO on account of housekeeping charges to various business associates .....

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the Act were issued on various dates as per record. The AO noted that the assessee company was providing house keeping services to its associated concerns. The total receipts of ₹ 8508342/- from such services were credited to the profit and loss account and shown under the head other income in the P & L account. During the course of assessment proceedings of Asst. Year 2003-04 the assessee was asked to furnish details of house keeping charges received and the nature of service provided .....

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e service to the extent it claimed. These aspects were examined in detail in the Asst. Year 2003-04. In view of the detailed discussion and analysis made by the assessing office in the assessment order of Asst. Year 2003-04 the AO proceeded to consider the receipts as income from other sources and it was accordingly treated while computing the total income. Considering the detailed findings regarding services provided, facilities/infrastructure available vis-à-vis charges received, it was .....

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rther noted that the assessee provided office accommodation to various sister concerns. In other words, the same had been let out to the sister concerns. Hence the portion of house keeping charges represented the receipts for letting out the property and the same was nothing but rental income. In various judgments, courts have held that the composite rent receipts for providing added auxiliary services. The AO also relied on following decisions in this regard:- 1. CIT vs. Smt. P. Andal Ammal 243 .....

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he ld. CIT(A) and submitted as under :- Earlier also during assessment year 2003-04, the same view was taken. But however, ITAT has ruled in with the favour of assessee i.e. the order of CIT(A) treating the income as the business income has been confirmed (Rf.IT No.261/Ahd/2007). The ITAT has also held that even if the income is held as income from other sources, the depreciation is to be allowed, there are no material changes so far as facts during current year is concerned. For Asst. Year 2005 .....

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. CIT(A) considering the submissions of assessee and following the decisions of the Tribunal in ITA No.261/Ahd/2007 dated 30.09.2009 deleted the impugned addition and allowed the appeal of assessee. Aggrieved by this order of the ld. CIT(A) the Revenue is in appeal before the Tribunal. . None appeared on behalf of the assessee. However, after hearing the ld. DR and considering the material on record, we proceeded to decide the appeal. 5. The ld. DR relied on the order of AO and submitted that no .....

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on by following the decision of the Tribunal in assessee s own case for Asst. Year 2003-04, wherein the Tribunal in ITA No.261/Ahd/2007 observed as under :- We have heard the rival submissions, perused the orders of the lower authorities and the materials available on record. In our considered view, there is no case for interference in the order of the Learned CIT(Appeals). The reasons are:- (i) That, the Assessing Officer has not doubted that what the assessee is receiving is income from busine .....

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urt in the case of CIT vs. Moon Light Builders and Developers (2008) 307 ITR 197 (Delhi) and of Hon'ble Madhya Pradesh High Court in the case of CIT vs. Dineshkumar (2008) 299 ITR 59 (M.P.). Thus, if the facts are not different, then view once taken should be followed in subsequent year also. (iii) If certain part of expenditure incurred by group concerns in receiving services from the assessee company is not genuine or is excessive, then action is required to be taken in their hands. Assess .....

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