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TMI Blog2018 (8) TMI 1622X X X X Extracts X X X X X X X X Extracts X X X X ..... taken by the respective parties, it will be appropriate to have a look at the facts leading to these appeals. 2. Assessee engaged in the business of building, selling and leasing out Information Technology parks had given out on rent an IT Park called ''Ambit IT Park'' to various parties like CSS Corporation, Akshya Foods and Services Pvt. Ltd, Prizm payment services pvt. Ltd and Lopex Technologies. From the agreements with these parties, it was noted by the ld. Assessing Officer that assessee had received rental receipts as well as maintenance charges from lessees. Assessee had shown its income under the head ''income from business/profession''. However, ld. Assessing Officer noted that lessees had deducted tax u/s.194I of the Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Contention of the assessee was that it was engaged in the development of IT park and providing services alongside leasing out the infrastructural facility so as to exploit the property commercially. Thus, as per the assessee its income had to be considered under the head business/profession. Assessee also placed reliance on a judgment of Hon'ble Jurisdictional High Court in the case of CIT vs. Elnet Technologies Ltd, (2013) 89 DTR 442. 4. However, ld.CIT(A) was not fully appreciative of the above contentions. According to him, by virtue of the judgment of Hon'ble Apex Court in the case of East India Housing & Land Development Trust Limited, (1961) 42 ITR 49, Karnani Properties Limited vs. CIT, (1971) 82 ITR 547 and S.G. Mercantile Corpor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. Ld. Counsel for the assessee, strongly assailing the order of ld. Commissioner of Income Tax (Appeals) submitted that the partnership deed of the assessee firm gave its object as purchasing, selling, consolidating any land and plots, constructing, promoting, developing, industrial parks, information technology buildings, commercial buildings for sale, rent, lease or both. As per the ld. Authorised Representative, though there were two agreements with the clients, one for leasing out IT park and the other for maintaining and providing services relating to the infrastructure facility both there were contemporaneously entered into. According to the ld. Authorised Representative these agreements had to be construed together. Relying on a ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wo agreements are to be considered under the head income from house property or income from other sources or income from business. Ld. Assessing Officer himself had observed that assessee had leased out the space alongwith a host of supporting features which helped its business. Assessee had obtained approval from Department of Information Technology, Ministry of Communications and Information Technology, Government of India through a letter dated 30.06.2009 which has been placed at paper book page 16 & 17. What was mentioned in the above letter is reproduced hereunder:- ''Your application was considered by the Inter-Ministerial Standing Committee (IMSC) for Software Technology Park (STP ) and Electronics Hardware Technology Park (EHTP) S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iting the property. If it is found applying such principle that the intention is for letting out the property or any portion thereof, the same may be considered as rental income or income from properties. In case, if it is found that the main intention is to exploit immovable property by way of complex commercial activities, in that event it must be held as business income''. Thus, what is to be looked into is intention of the parties while entering into the lease. Admittedly, the agreements entered by the assessee with the lessees were contemporaneous. Objects of the lease was to allow enjoyment of the entire property with all services related to its use as technology centers. Main object of the assessee firm as it appears in its partners ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pearing for the Revenue. 11. The judgment relied upon by the learned counsel appearing for the assessee squarely covers the facts of the case involved in the appeals. The business of the company is to lease its property and to earn rent and therefore, the income so earned should be treated as its business income''. In the circumstances, we are of the opinion that the income of the assessee both from leasing the space as well as providing maintenance services had to be considered only under the head income from business. Ld. Assessing Officer fell in error in treating such amounts under the head income from house property. Ld. Commissioner of Income Tax (Appeals) fell in error in treating part of such income as income from house property. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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