TMI Blog2016 (8) TMI 1506X X X X Extracts X X X X X X X X Extracts X X X X ..... of business modules, etc. Therefore, it has to be construed as infrastructure facility with all specifications and requirements. CIT(Appeals) has rightly placed reliance on the judgment of Madras High Court in Elnet Technologies Ltd. [2012 (11) TMI 671 - MADRAS HIGH COURT] - As rightly submitted by assessee, the judgment of Madras High Court in Chennai Properties Investments Ltd. [2003 (3) TMI 28 - MADRAS HIGH COURT ] was reversed by the Apex Court [ 2015 (5) TMI 46 - SUPREME COURT ]. The Apex Court found that when the assessee let out the property as business, the rental income has to be assessed as income from business. Therefore, this Tribunal is of the considered opinion that the CIT(Appeals) has rightly allowed the claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rder of the Commissioner of Income Tax (Appeals)-II, Chennai, dated 03.11.2014 and pertain to assessment years 2010- 11 and 2011-12. The assessee has also filed cross-objection against the very same order for the assessment year 2010-11. Therefore, we heard the appeals of the Revenue and the crossobjection of the assessee together and disposing of the same by this common order. 2. Shri Jayaram Raipura, the Ld. Departmental Representative, submitted that the only issue arises for consideration in both the appeals is with regard to classification of rental income received by the assessee. According to the Ld. D.R., the assessee constructed a I.T. Park, namely, Olympia Tech Park, and claimed the rental income as income from business . Refe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emises while letting out the property to the software companies. The assessee has also organized uninterrupted and continues power supply and heavy power backup generators. Therefore, the CIT(Appeals) by placing reliance on the judgment of Madras High Court in CIT v. Elnet Technologies Ltd. (2013) 213 Taxman 129, allowed the claim of the assessee. Referring to the grounds of appeal filed by the Revenue before this Tribunal, the Ld. representative submitted that the Revenue is placing reliance on the judgment of Madras High Court in CIT v. Chennai Properties Investments Ltd. (266 ITR 685). This judgment of Madras High Court was reversed by the Apex Court. Therefore, according to the Ld. representative, the reliance placed by the Revenue in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is confirmed. 5. Now coming to the cross-objection filed by the assessee for assessment year 2010-11, the grievance of the assessee is that the Assessing Officer disallowed ₹ 21,91,665/- under Section 14A of the Act. 6. Shri Ajit Kumar Choradia, the Ld. representative for the assessee, submitted that during the year under consideration, the assessee earned dividend income of ₹ 6,77,302/- and the same was claimed as exempted from taxation. The Assessing Officer worked out the disallowance under Section 14A of the Act to the extent of ₹ 21,91,665/-. According to the Ld. representative, the investment made by the assessee to the extent of ₹ 26,65,60,000/- in Deep Discount Bonds cannot be construed as investment fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, submitted that the assessee admittedly received dividend income to the extent of ₹ 6,77,302/- and claimed the same as exempted from taxation. Therefore, it cannot be said that the assessee has not earned any exempted income. Hence, the assessee earned the exempted income and the Assessing Officer is not satisfied about the claim of expenditure, the disallowance has to be computed as per the method prescribed under Rule 8D(2) of Income-tax Rules, 1962. 9. Referring to the assessment order, more particularly at page 5, the Ld. D.R. submitted that the Assessing Officer has taken the direct expenditure attributable to the income and the indirect expenditure incurred by the assessee, which is not relatable to any particular income an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in any exempted income and the income from deep discount bonds is taxable. However, no details of investments said to be made by the assessee which earned taxable income are available either before the Assessing Officer or before this Tribunal. Moreover, the so-called investments in subsidiary companies are also not available on record. In the absence of any such details either before this Tribunal or before the CIT(Appeals) or before the Assessing Officer, the claim of the assessee that the investment made in deep discount bonds and subsidiary companies has to be excluded cannot be accepted. When the assessee claims that investment in deep discount bonds resulted in taxable income, it is for the assessee to file necessary material to sub ..... X X X X Extracts X X X X X X X X Extracts X X X X
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