TMI Blog2020 (1) TMI 1016X X X X Extracts X X X X X X X X Extracts X X X X ..... h the agreement dated December 31, 2010 at the time of assessment proceedings and when once both the documents were presented by the assessee to the Assessing Officer during the course of assessment proceedings, thus, in that circumstances, it was incumbent upon the Assessing Officer to verify the genuineness and veracity of the said document. The Assessing Officer was not expected to adopt the short method and simply reach to the conclusion that the said addendum dated April 12, 2011 was an afterthought without recording any reasons or basis for reaching to the said conclusion. Bifurcation done by the assessee under the two heads of income, i. e., income from house property and income from business is in conformity with law and the same has been done on the basis of comparative market rate as charged by him from the other parties including that of the hon'ble High Court. That since the bifurcation has been done on scientific basis and no infirmity has been pointed out on record by the Assessing Officer by placing on record any counter rates or has not been able to rebut the said comparative market rates placed on record by the assessee, no new facts or circumstances hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se was selected for scrutiny under CASS and the assessment was completed at an assessed income of ₹ 11,04,41,597 thereby making additions under different heads. Aggrieved by the order of the Assessing Officer, the assessee preferred an appeal before the learned Commissioner of Income-tax (Appeals) and the learned Commissioner of Income-tax (Appeals) after considering the submissions of both the parties, partly allowed the appeals. 3. Aggrieved by the order of the learned Commissioner of Income-tax (Appeals), the Revenue has filed the present appeal before us on the grounds mentioned hereunder : (i) Whether on the facts and in the circumstances of the case, the learned Commissioner of Income-tax (Appeals) has not erred in law as well as on the facts in deleting the addition of ₹ 4,10,66,418 made by adding back one-third statutory deduction after treating the income from house property of ₹ 13,68,88,726 as income from business whereas the income received is of composite nature and not from the bare letting of the property ? (ii) Whether on the facts and in the circumstances of the case, the learned Commissioner of I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of space as well as providing of services, which could not be segregated. It was further submitted that as per the agreement, the assessee is to undertake the service of scanning, indexing, auditing, digitlisation and physical storage of booked documents, hence the income is not covered solely under the purview of income from house property as per the provisions of section 22 of the Income-tax Act, 1961 and the receipts are composite and cannot be segregated. 5. The learned Departmental representative also relied upon the written submissions filed by him on November 14, 2009 which are reproduced below : 1. The assessee was having a property situated in sector-62, Noida. The assessee entered into a service agreement on December 31, 2010 with M/s. PACL Ltd. As per the said agreement, the assessee was to provide services of receipt of documents/booklets, scanning the same using high quality latest scanners, keeping the documents for digital storage, auditing the documents in the digital form, indexing and storage of the same, maintaining software for documents for the location of the their hard copy, providing scanned images, etc. (clause 3 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of such services rendered using its own man power by the asses see. Thus the assessee performed various composite services in a systematic, organised and continuous basis by creating necessary infrastructure and expertise for which consideration has been charged not on lump sum basis but on the basis of per unit work done and volume of the document handled during a particular time period. Such features of these composite activities performed are in the nature of business/profession and not in the nature of income from house property. 7. It is relevant to mention that M/s. PACL has deducted TDS upon such payment under section 194C of the Act by treating the same as contractual receipts and not under section 194-I as rental payments. 8. Though the Assessing Officer has not accepted the addendum, even if the addendum is considered, through which PACL had acquired control over the property, it would not change the nature of service agreement and nature of services performed on composite basis as per the addendum the control was taken by PACL to ensure confidentiality of the data only. 9. Storage was one of many services performed by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hon'ble Income-tax Appellate Tribunal, Calcutta in the case of Dy. CIT v. Maa Amba Towers Ltd. (I. T. A. No. 1381/Kolkata/2015 dated October 12, 2018-ITAT-Cal) and further upon the decision of the hon'ble Income-tax Appellate Tribunal, Banglore in the case of ITO v. Anjaneya Infrastructure Projects P. Ltd. (I. T. A. No. 693/Bang/2015 dated August 5, 2016). 11. From the facts of the present case it is thus humbly requested that the assessee has carried out the business activities/adventure in the nature of trade by performing various composite services for M/s. PACL during the year and thus there was no justification for treating the storage component as income from house property. It is also relevant that the assessee has bifurcated the composite services receipt into two components without any basis whereas there was no such bifurcation was provided in the agreement. 12. Without prejudice to the above grounds of appeal, the assessee represented before the Commissioner of Income-tax (Appeals) that the amount of ₹ 21,93,848 may be disallowed on account of depre ciation on the building situated at Noida and lease rentals paid against t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant. The nature of business of the appellant is clear from the memorandum of association placed at page 231 of the paper book. 2. The appellant owns commercial properties at C-56A/10 and 11, Sector 62, Noida-201 301 and at ITC-4, Sector 67, Mohali-160 062 allotted by the Noida Authority and Punjab Infotech Mohali respec tively. 3. The renting of property was never the business of the appellant as it is not the object of the appellant. 4. On realising that premises is in excess of its own need, a part of property at Mohali was rented out to M/s. Spanco BPO Services Ltd. and rental income was included as income from house property in the computation of income and has been accepted by the Assessing Officer as such. The COI is forming part of paper book at pages 1 to 5. 5. As per the agreement dated December 31, 2010 the appellant had rented out the premises to PACL primarily for utilisation of its space to store records/booklets and the services of scanning, auditing, indexing and digital storage were merely ancillary/incidental to serve the main intention/purpose of providing physical storage. (page 28 to 37 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the assessment year 2012-13 in the year under consideration. 11. The assessee has also carried out the work of scanning for the Supreme Court of India but never provided storage facility due to confidentiality of records. However, in the instant case, PACL for its own convenience and to avoid transportation of booklets from the location from where it is scanned and to the location where it will be stored entered into an agreement of physical storage of booklets. 12. It clarifies the intention of the parties that the property was let out to enable PACL to utilise the said space for storage of records/booklets and the service of scanning, indexing and auditing were merely incidental. 13. During the course of assessment proceedings, the Assessing Officer was of the view that the income shown by the appellant under the head 'income from house property' is business income and accordingly he taxed the same under the head 'income from business or profession' and standard deduction claimed under section 24(a) of the Act was disallowed vide order dated March 18, 2016. 14. Now, against the order pass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 taxmann.com 193 (SC) What is the test which has to be applied to determine whether the income would be chargeable under the head 'income from house property' or it would be chargeable under the head 'Profits and gains from business or profession', is the question. It may be mentioned, in the first instance, that merely because there is an entry in the objects clause of the business showing a particular object, would not be the determinative factor to arrive at a conclusion that the income is to be treated as income from business. Such a question would depend upon the circumstances of each case. It is so held by the Constitution Bench of this court in Sultan Brothers P. Ltd. v. CIT [1964] 51 ITR 353 (SC) and we reproduce the relevant portion thereof (page 358) : '7. We think each case has to be looked at from a businessman's point of view to find out whether the letting was the doing of a busi ness or the exploitation of his property by an owner. We do not further think that a thing can by its very nature be a commercial asset. A commercial asset is only an asset used in a business and nothing else, and business may be carr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sultan Brothers P. Ltd. v. CIT as reported in [1964] 51 ITR 353 (SC) CIT v. Haryana Urban Development Authority as reported in [2010] 322 ITR 61 (P H) Since the main business of the assessee was not renting out the premises, the income derived would be assessable as income from house property and not business income. CIT v. Indian Warehousing Industries Ltd. as reported in [2002] 258 ITR 93 (Mad) ; [2003] 133 Taxman 293 (Mad) CIT v. Sane and Doshi Enterprises as reported in [2017] 77 tax mann.com 288 (SC) CIT v. Gundecha Builders as reported in [2019] 102 taxmann.com 27 (Bom) Section 22, read with section 28(i), of the Income-tax Act, 1961- Income from house property-Chargeable as (Business income v. House property income)-Assessment year 2008-09-Whether where assessee was engaged in business of development of real estate project, rental income received from unsold portion of property constructed by it was assessable to tax as income from house prop erty-Held, yes (para 3(e)) (in favour of assessee) Atma Ram Properties (P.) Ltd. v. Jt. CIT as repor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [2002] 258 ITR 93 (Mad) 8. CIT v. Sane and Doshi Enterprises [2017] 77 taxmann.com 288 (SC) 9. CIT v. Gundecha Builders [2019] 102 taxmann.com 27 (Bom) 10. ITO v. Bhagwat Marcom (P.) Ltd. [2019] 109 taxmann.com 330 (Kolkata-Trib) 9. We have heard the counsels of both the parties, we have also perused the material placed on record, judgments cited by the respective parties, and the orders passed by the Revenue authorities. As per the facts of the present case, during the year under consideration, the assessee offered to tax ₹ 13,68,88,726 as income under the head house property from M/s. PACL Ltd. and the Assessing Officer treated this income received by the assessee from M/s. PACL Ltd. as taxable under the head business income on the ground that the assessee was not engaged in mere letting out of space with a view to earn rental income therefrom but was engaged in complex activities of undertaking services like scanning, indexing, auditing and digitisation of records, etc., for which consideration was received on a composite basis, i. e., per booklet basis and thus, the same constituted business activitie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... PACL Ltd. in the books of the assessee for the period April 1, 2010 to March 31, 2011, copy of the certificate dated March 23, 2015 issued by Canon (India) Ltd. verifying average life of scanner and sample invoices, etc. From the conjoint reading of all the documents as mentioned above and other documents placed on record by both the parties, we reached to the conclusion that the assessee had entered into a service agreement on December 31, 2010 with M/s. PACL India Ltd. The agreement was initially valid for a period of one year, i. e., December 31, 2011. The said agreement was followed by an unregistered addendum to this agreement signed on April 12, 2011. The assessee treated this agreement as a combined agreement for two independent activities, i. e., first letting out the premises and the second for providing certain ancillary services like scanning, digitisation, etc. The assessee received a composite amount of ₹ 12.50 per booklet for physical storage, indexing, scanning of the records, etc. The total consideration received from M/s. PACL Ltd. was bifurcated as income from house property and income from business but income from house property was declared on accou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated April 12, 2011 was an afterthought without recording any reasons or basis for reaching to the said conclusion. 13. After taking the addendum into consideration, the character/substance of the contract of the terms of the contract contained therein, following facts, as were also noticed by the learned Commissioner of Income-tax (Appeals) are established, are as follows : (a) The appellant is a public limited company incorporated under the Companies Act and engaged in the business of providing services in the field of information technology and rendering call centre services. The renting of property/premises was never the business of the assessee nor is it the object of the assessee-company. (b) The appellant owns commercial properties at C-S6A/10 and 11, Sector-62, Noida-201 301 and at ITC-4, Sector 67, Mohali-160 062. The premises were allotted to the assessee by the NOIDA authority and by Punjab Infotech at Mohali respectively and is in continuous use of the assessee for business purposes related to the activities of lT/ ITES. (c) A part of the property at Mohali was rented out to M/s. Spanco BPO Services Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r undertaking the services. This is provided in clause 3.7 The hard copies of the booklet shall be handled with utmost care and stored by the second party in high quality plastic bags . 3.8 Second party shall provide adequate serial numbering to the bundles according to land registration booklets stored in it and shall record the same in the software (document maintenance software) having scanned copies in order to easily identify the location of the hard copy of the booklets . (vi) Clause 7 with respect to the responsibility of the second party reads as under : Clause 7 : Second party shall remove the digital data after its delivery to the first party after fifteen days. Clause 9 : The second party represents and warrants that it has the requisite technical experience, skills and resources to carry out its obligations in accordance with the terms and conditions of this agree ment . . . (vii) The agreement clearly states that the assessee would receive the service charge of ₹ 12.50 per booklet and there is no separate break up of payment for physical storage with other services provided. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The incidental services of scanning, indexing, auditing, etc., of booklets/documents/files shall be undertaken by the second party at us premises located at C-56A/10 and 11, Sector 62, Noida-201 301 and thereafter the said booklets/documents/files shall be physically stored at the space/site comprising of approximately 40,000 square feet at the aforesaid premises, which shall be in the exclusive control and possession of the first party. 10.5.6 The provisions of law relevant for adjudication of this issue are discussed below : As per the scheme of taxation under the provisions of the Act, income of an assessee from various sources is taxable under five different heads specified in section 14 of the Act which are as under : 1. Salaries 2. Income from house property 3. Profits and gains of business or profession 4. Capital gains 5. Income from other sources Out of the aforesaid heads of income, section 22 deals with income to be assessed under the head income from house property and section 28 deals with income to be assessed under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 21-11-2011 1-1-2012 to 30-5-2012 1-1-2012 to 30-5-2014 Page Nos. 43-45 of paper book 4. Revised supplementary agreement 27-2-2012 1-6-2012 to 30-11-2012 30-5-2012 to 30-11-2014 Page Nos. 46-48 of paper book 5. Revised supplementary agreement (amended) 1-6-2012 1-12-2012 onwards 1-12-2012 onwards Page Nos. 49-51 of paper book 15. After appreciating all the above documents, it becomes clear that the agreement can be bifurcated into two parts, one being for physical storage of the documents and the second being for providing of various services. The income arising on account of physical storage of the documents as the character of rent from the letting out of the premises and has to be taxed under the head income from house property and the income arising on account of providing various ancillary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee and this is also clear from the objects of the memorandum and articles of associations. This fact has also been acknowledge by the Assessing Officer in the assessment order in so far as the rental income from M/s. Spanco BPO for renting out the premises at Mohali by the assessee has been assessed as 'income from house property'. The appellant has let out the part of the build ing at C-56AJ 10 and 11, Sector 62, Noida to PACL for storage of their records. The storage of the booklets was for a long period of time, i. e., up to three years and the services to be rendered were very less time taking and the expenditure thereon was minimal. Thus the dom inant intention of the appellant was to let out the part of the building for utilisation of storage space by PACL and the services in the nature of scanning, indexing, etc., were merely incidental in nature. These facts have also been clearly stated in the addendum. Thus the income received from PACL was lo be assessed under the head 'income from house property'. Reliance in this regard is placed on the decisions of the hon'ble Supreme Court in the cases of East India Housing and Land Development Trust Ltd. v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the same premises was earmarked for the storage of the documents of PACL. Even other wise, a part of the same premises can be used for the business of the assessee and a part thereof can be let out. (e) The Assessing Officer has stated that in order to undertake the services provided under the agreement, the assessee had made suitable changes in the premises such as providing equipment, manpower, system for retrieval of the document, etc. This conclusion of the Assessing Officer had been drawn on the basis of clause 6.6 of the agreement which provides that the hard copy of the booklets should be handled with care and stored in high quality plastic bags. Further, they had to serial number and recorded in a software to easily identify the location of the hard copy of the booklet. The appel lant has denied having carried out any additions/alteration in the premises and nothing contrary has been brought on record in the assessment proceedings. The changes highlighted by the Assessing Officer can at best be considered a part of the various ancillary services being provided by the appellant in addition to the storage of the records. (f) The Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court in the case of Kedarnath Jute Mfg. Co. Ltd. v. CIT [1971] 82 ITR 363 (SC). (h) The Assessing Officer has recorded a finding that the appellant had devised a self-styled system to bifurcate the receipts to claim deduction under section 24(a) and reduced its tax liability. This view of the Assessing Officer was culmination of his findings that the income of the assessee was only 'income from business'. It has been discussed elaborately by me in this order that this view of the Assess ing Officer was not correct and the bifurcation done by the assessee is as per law and hence this finding of the Assessing Officer is not jus tified. (i) In the remand report dated March 13, 2018 the Assessing Officer has reiterated the findings of the Assessing Officer in the assessment order. He has admitted that the addendum to the agree ment was furnished during the assessment proceedings the authen ticity of the addendum cannot be verified as the addendum was not registered and the addendum appeared to be an afterthought. It was also stated that even after considering the addendum the income of the assessee remained income from business. In my opinion ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;income from house property'. 16. We have also considered the decisions in the case of East India Housing and Land Development Trust Ltd. (a) East India Housing and Land Development Trust Ltd. v. CIT [1961] 42 ITR 49 (SC), the facts before the apex court were that an assessee, which was incorporated with the objects of buying and developing landed properties and promoting and developing markets, had purchased ten bighas of land at Calcutta and had set up a market through construction of shops and stalls, thereon. The assessee let-out shops/stalls on rent and rental income so earned was offered to tax as business income, which was assessed as income from house property by the Assessing Officer. In the aforesaid background, the question before the court was whether the income realised by the assessee from the tenants of the shops and stalls was liable to be taxed as business income under section 10 of the Indian Income-tax Act, 1922, or as income from property under section 9 thereof. The court held that income derived from the shops and stalls was income received from property and fell under the specific head income from house property ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tail market. Maharashtra Housing and Area Develop ment Authority, therefore handed over the ground floor (stilt portion) of the above said buildings to Market Department of Municipal Corporation Greater Bombay ( MCGB ). In 1993, the market depart ment of the Municipal Corporation Greater Bombay auctioned the market portion on a monthly licence (stallage charges) basis to run a municipal market. The assessee-firm participated in the auction to acquire the right to construct the market on the market portion. The assessee was the successful bidder and was handed over possession of the market portion on May 28, 1993. The premises allotted to the assessee was a bare structure, on stilt that is, pillar/column, sans even four walls. In terms of the auction, the assessee was to make the entire premises fit to be used a market, including construction of walls, construction of entire common amenities like toilet blocks, etc. Accordingly, after taking possession of the premises, the assessee spent substantial amount on additions/alternations of the entire premises, including demolishing the existing platform and, thereafter, reconstructing the same according to the new plan sanctioned by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the specific head of income dealing with rental income, notwithstanding that the said activity was carried on by the assessee as part of its main object. The relevant observations of the apex court in this regard are as under (page 607 of 394 ITR) : 13. Before dealing with the respective contentions, we may state, in a summary form, scheme of the Act about the computation of the total income. Section 4 of the Act is the charging section as per which the total income of an assessee, subject to statutory exemptions, is chargeable to tax. Section 14 of the Act enumerates five heads of income for the purpose of charge of Income-tax and computation of total income. These are : salaries, income from house property, profits and gains of business or profession, capital gains and income from other sources. A particular income, therefore, has to be classified in one of the aforesaid heads. It is on that basis rules for computing income and permissible deductions which are contained in different provisions of the Act for each of the aforesaid heads, are to be applied. For example, the provisions for computing the income from house property are contained in sections 22 to 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion', is the question. It may be mentioned, in the first instance, that merely because there is an entry in the objects clause of the business showing a particular object, would not be the determinative factor to arrive at a conclusion that the income is to be treated as income from business. Such a question would depend upon the circumstances of each case. It is so held by the Constitution Bench of this court in Sultan Brothers P. Ltd. v. CIT [1964] 51 ITR 353 (SC) and we reproduce the relevant portion thereof (page 358) : 'We think each case has to be looked at from a businessman's point of view to find out whether the letting was the doing of a business or the exploitation of his property by an owner. We do not further think that a thing can by its very nature be a commercial asset. A commercial asset is only an asset used in a business and nothing else, and business may be carried on with practically all things. There fore, it is not possible to say that a particular activity is business because it is concerned with an asset with which trade is commonly carried on. We find nothing in the cases referred, to support the prop osition that certain asset ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rightly held by the Assess ing Officer, the decision of the hon'ble Supreme Court in the case of Shambhu Investment P. Ltd. v. CIT [2003] 263 ITR 143 (SC) will apply. The assessee has not established that he was engaged in any systematic or organised activity of providing service to the occupiers of the shops/stalls so as to constitute the receipts from them as busi ness income. In our opinion, the assessee received income by letting out shops/stalls ; and therefore, the same has to be held as income from house property.' 18. The Income-tax Appellate Tribunal being the last forum in so far as factual determination is concerned, these findings have attained finality. In any case, as mentioned above, the learned counsel for the appellant did not argue on this aspect and did not make any efforts to show as to how the aforesaid findings were perverse. It was for the appellant to produce sufficient material on record to show that its entire income or substantial income was from letting out of the property which was the principal business activity of the appellant. No such effort was made. 19. Reliance placed by the appellant on the judgments of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny formed with the object of developing and setting up properties.' 20. In Rayala Corporation (P.) Ltd. the fact situation was identical to the case of Chennai Properties and Investments Ltd. and for this reason, Rayala Corporation (P.) Ltd. followed Chennai Properties and Investments Ltd. which is held to be inapplicable in the instant case. 21. For the aforesaid reasons, we are of the opinion that these appeals lack merit and are, accordingly, dismissed with costs. (e) In the case of CIT v. Indian Warehousing Industries Ltd. [2002] 258 ITR 93 (Mad) the hon'ble High Court of Madras held that the source of the income being the warehouses, it matters little as to who the lessee for the time being is, whether it is the same lessee continuing over a period of time or a shifting class of lessees who occupied the spaces for shorter periods and paid rental for such use and as such the same is income from house property. (f) In the case of Nutan Warehousing Co. (P.) Ltd. v. ITO on August 31, 2006, [2007] 106 TTJ 137 (Pune) the Income-tax Appellate Tribunal, Pune Bench wherein considering the various decisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that, if, as we have held, the contracts in the present case oblige the assessee to make available information and render services to the foreign Government of the nature outlined in section 80-O, it is the duty of the Revenue and the right of the assessee to see that the consideration paid under the contract legitimately attributable to such information and services is apportioned and the assessee given the benefit of the deduction avail able under the section to the extent of such consideration. (h) In the case of Karnani Properties Ltd. v. CIT [1971] 82 ITR 547 (SC), where the assessee-company, in addition to letting out of a building owned by it, provided other amenities/services to the tenants and those tenants in addition to paying rents, made separate payments for the other services/amenities provided by the assesseecompany, like, charges for electric current, for use of lifts, for the supply of hot and cold water, for the arrangement for scavenging, for providing watch and ward facilities as well as other amenities. The question before the apex court was whether rendering of such services to the tenants by the assessee-company, which owned the building, wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d therefore, income arising out of providing services has to be assessed under the head business income . Accordingly, the learned Commis sioner of Income-tax (Appeals) has also rightly bifurcated the consideration received from PACL Ltd. under the two heads of income, i. e., income from house property and income from business . We have also metic ulously considered that the Commissioner of Income-tax (Appeals) has correctly bifurcated the consideration received under the two heads by considering the bifurcation as carried out by the assessee which is contained in para 10.6.1 of the order of the learned Commissioner of Income-tax (Appeals) and the same is reproduced below : 10.6.1 During the previous year under consideration the appellant has received the consideration of ₹ 12.50 per booklet from M/s. PACL as per the contract entered into between the parties on Decem ber 31, 2010. This composite amount has been bifurcated by the assessee between 'income from house property' and 'income from business'. ₹ 10.75 per booklet has been shown as income towards providing storage space to be spread over three years and ₹ 1,75 per bookl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plastic bags and lying the same to hand them for storage. 0.26 (i. e., average per minute salary *average minutes per booklet) (₹ 0.52 per minute * 0.50 minute (i. e., 30 seconds) per booklet) 4. Cost of the high quality plastic bag and tag to store the booklet (cost per bag /100) *1 -2 Rs. per bag /100 booklets. 0.02 5. Miscellaneous expenses (e. g., electricity, water and miscellaneous expenses, etc.) 0.15 6. Profit margin 0.32 Total cost of scanning per booklet of 6 pages 1.75 Cost per page, i. e., ₹ 1.75/6 pages 0.29 We wish to highlight that, each booklet contains a total of 18 pages when folded which includ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition, the Assessing Officer has failed to appreciate these facts that the assessee had correctly bifurcated the total consideration on scientific basis and location for scanning work works out fully comparable with the similar/identical services rendered to the hon'ble High Court. Moreover, the Assessing Officer has also not confronted the assessee for the same facts during the course of assessment proceedings and thus, the basis for bifurcation done by the assessee which has been detailed above has went unrebutted. In our considered view, the bifurcation done by the assessee under the two heads of income, i. e., income from house property and income from business is in conformity with law and the same has been done on the basis of comparative market rate as charged by him from the other parties including that of the hon'ble High Court. That since the bifurcation has been done on scientific basis and no infirmity has been pointed out on record by the Assessing Officer by placing on record any counter rates or has not been able to rebut the said comparative market rates placed on record by the assessee, no new facts or circumstances have been brought before us in order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ental proportionate to the area rented to PACL should be disallowed. Ground of appeal No. 2 is allowed. 20. After having heard the counsels and perusal of the orders, we find that similar additions were also made in the assessment year 2011-12 which were deleted by the Commissioner of Income-tax (Appeals) vide order dated May 25, 2017 wherein 100 per cent. depreciation was allowed by the Commissioner of Income-tax (Appeals). On handsets, phones 80 per cent. depreciation has been allowed and 60 per cent. depreciation was allowed on projector, therefore, following the said decisions the Commissioner of Income-tax (Appeals) had decided this ground. 21. The Revenue has not placed on record any material to rebut the contentions of the Commissioner of Income-tax (Appeals) or has not placed on record any order of higher authority disagreeing with the order of the Commissioner of Income-tax (Appeals) in the earlier orders. Thus, we find no reasons to interfere into the said finding recorded by the Commissioner of Income-tax (Appeals). Therefore, this ground raised by the Revenue also stands dismissed. 22. Accordingly, the appeal filed by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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