TMI Blog2021 (2) TMI 541X X X X Extracts X X X X X X X X Extracts X X X X ..... as Business income all along since AY 1999-2000 except for this assessment year and AYs 2007-08 2008-09. Though undisputedly, the principle of res - judicata is not applicable to income tax proceedings but the rule of consistency would demand that accepted position is not disturbed on identical facts as per the decision in the case of PCIT v/s. Quest Investment Advisors Pvt. Ltd. [ 2018 (7) TMI 479 - BOMBAY HIGH COURT ] wherein it has been held that when a principle has been accepted by the Revenue in earlier years as well as in subsequent years then the Revenue is bound by it unless there is a change in law or change in facts therein, which change has to be pointed out in the assessment Order. Therefore, action of Ld. AO in disturbing the rental / lease income as Business Income could not be held to be justified. Once the assessee s position has been accepted in so many past as well as succeeding years, there is no reason to disturb the same only in few years, the facts being remaining the same. Therefore, we are inclined to hold that the rental / lease income from building as well as from plant machinery was assessable as Business Income only. Consequently, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essing Officer (AO) u/s 143(3) on 30/11/2006. The only grounds urged before us are ground nos. 2 to 4 which read as under: - Ground No. 2: The learned CIT(A) failed to appreciate that the appellant continues to run its business and grossly erred in confirming the action of the learned AO of disallowing ₹ 42,53,152/- of Retrenchment Compensation, without appreciating the fact that such compensation is paid under section 25F of Industrial Disputes Act and is a deductible expenditure. Ground No. 3: (i) The learned CIT(A) grossly erred in confirming the action of the learned AO to treat the entire lease rentals of ₹ 30,33,600/- included under the head 'Income from Business' to be 'Income from Property' of ₹ 27,00,000/- and 'Income from Other Sources' of ₹ 3,33,600/-. (ii) Without prejudice to above, the learned CIT(A) grossly erred in confirming the action of the learned AO of disallowing ₹ 17,29,197/- being depreciation on assets given on lease rental, u/s 57(ii) of the Income Tax Act, 1961. Ground No. 4: The learned CIT(A) grossly erred in confirming the action of the learned AO of making an addition of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 89 and as late as 01/08/2003. Upon perusal of the same, Ld. AO opined that the assessee had been shedding its business premises and plant machinery in phased manner right from year 1995 to its associated concerns. The assessee defended its stand of offering rental / lease income as Business Income by submitting that in earlier years, this position was accepted by the department at assessment level itself. However, in the background of ratios of various judicial pronouncements holding the field, Ld. AO ultimately held that rent received from building was to be assessed under Income from House Property whereas rent received on Machinery and other asset was to be taxed as Income from Other Sources . The alternative claim that the depreciation should be allowed u/s 57(ii) was also rejected since the assessee was not hirer of plant, machinery and furniture etc. 4.4 Proceeding further, it was noted that the assessee was receiving nominal rent of ₹ 10000/- from M/s VSS for using the premises of 1740.20 Sq. Meters at Daman. M/s VSS had met the entire cost of construction of the let out premises to the tune of ₹ 163.40 Lacs which was shown under the head sundry credito ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessed as Income from Other Sources . In the process depreciation on these assets has been denied to the assessee. It could also be observed that by accepting the trading results, Ld. AO has accepted the fact that assessee s business was continuing despite the observation that no manufacturing activity was being carried out by the assessee during the year which is also evident from the fact that except for depreciation allowance, retrenchment compensation along with minor disallowances, all other business expenditure as claimed by the assessee has been allowed by Ld. AO. 7. Proceeding further, we find that various lease agreements of buildings and Plant Machinery, entered into by the assessee, were continuing since past many years and the assessee earned rental / lease income in similar manner since AY 1999-2000 and offered the same as Business income . The assessee s stand has always been accepted by the department in most of other years. The Ld. AR has tabulated the assessment position, along with documentary evidences, for various years in the following manner:- No. AY Intimation / Assessment Order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12 2013-14 Assessment Order u/s. 143(3) 72,11,849 72,11,849 Yes 40-43 13 2014-15 Intimation u/s. 143(1) -67,11,748 -67,11,748 Yes 44-55 14 2015-16 Intimation u/s. 143(1) -3,54,56,694 -3,54,56,694 Yes 56-67 15 2016-17 Intimation u/s. 143(1) 8,72,819 8,72,819 Yes 68-79 16 2017-18 Intimation u/s. 143(1) NIL (after set-off of brought forward loss of ₹ 14,61,264) NIL (after set-off of brought forward loss of ₹ 14,61,264) Yes 80-93 17 2018-19 Intimation u/s. 143(1) NIL (after set-off of brought forward loss of ₹ 17,59,914) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of Sec.35DDA and accordingly, the same should be allowable in 5 equal installments. Concurring with the same, we direct Ld. AO to allow 1/5th of retrenchment compensation paid during the year. Ground No.2 stand partly allowed. The appeal stand partly allowed in terms of our above order. ITA No.3576/Mum/2012, AY 2007-08 10. The registry has noted a delay of 392 days in this appeal. The condonation of the same has been sought by the assessee on the strength of condonation petition dated 23/10/2012 which is supported by the affidavit of director of the assessee company. It has been submitted that there was a lapse on the part of tax consultant in fling the appeal which came to light only during engagement of new consultant. The Ld. AR also relied upon the decision of Hon ble Apex Court in Anil Kumar Nehru V/s ACIT (101 Taxmann.com 191) as well as in CIT V/s Progressive Education Society (102 Taxmann.com 402) to support the condonation of delay. Though Ld. DR opposed the condonation of delay, however, upon perusal of case records, we find that the issues in this year are quite similar to issue raised in AY 2004-05. The appeal for AY 2004-05 has been file ..... X X X X Extracts X X X X X X X X Extracts X X X X
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