TMI Blog2021 (3) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act . 2. The assessee has raised following grounds of appeal:- 1. On the facts and in the circumstances of the Appellant's case, the learned CIT(A) erred in confirming that income of ₹ 7,93,93,398/- is taxable under the head Income from House Property as against under the head Income from Business and Profession offered in the return of income of the appellant. 2. On the facts and in the circumstances of the Appellant's case, the learned CIT(A) erred in not allowing deduction in respect of various expenditure incurred during the year against common area maintenance income and space selling income tax as income from business and profession. 3. The fact in brief is that return of income declaring total loss of Rs. (-)2,35,58,479/- was filed on 30th Sep, 2015. The case was subject to scrutiny assessment and notice u/s. 143(2) of the Act was issued on 21nd March, 2016. During the course of assessment, the Assessing Officer noticed that assessee has earned income from various let out properties and shown the same as business income by making reference to the earlier assessment year. The Assessing Officer has asked the assessee to explain why the inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation, the Assessing Officer has treated the income from let out of various properties in the mall under the head house property as done in the earlier year in order to maintain consistency. With the assistance of ld. representatives, we have gone through the decision of Coordinate Bench of the ITAT for assessment year 2010-11 to 2013-14 and noticed that similar issue on identical facts has been decided in favour of the assessee vide ITA No. 3359/Ahd/2015, ITA No. 3560/Ahd/2015 and ITA No. 135/Ahd/2018. The discussion made by the Tribunal while allowing the claim of the assessee for assessment year 2013-14 vide ITA No. 135/Ahd/2018 is reproduced as under:- 6. We have considered rival submissions and gone through the record carefully. We have also gone through order of the Tribunal in the assessee's own case for the assessment year 2010-11 and 2011-12. We find that issues raised in this year are similar to assessment year 2010-11 and 2011-12. Before us, this is not a vexed issue, because the assessee is continuously claiming the same claim right from the Asstt. Year 2009-10, and the Tribunal has also upheld the treatment of income earned by the assessee under the income fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... king services and most of other services which are integrated and essential for successful operation of mall, consideration for which is included in the charges received from unit holders. The fact that these unit holders treat these charges as rent simpliciter and tax deducted at source under section 194-I cannot determine the question of taxability in the hands of the recipient. In the business model embedded by the operation of the shopping mall, as we have pointed out earlier, a complex web of integrated services are to be provided and the consideration received from those occupying the business premises is not simply as such rent for the premises. As we hold so, we find support from Hon'ble Supreme Court's judgment in the case of CIT vs. E-City Real Estate (P.) Ltd., [2018] 100 taxmann.com 94 (SC), wherein Their Lordships has, inter alia, observed as follows:- 14. In the present case, the facts are otherwise. The substantive income of the Assessee is from leasing out the shop/stalls. 15. The Tribunal in its Judgment, while appreciating the facts, has observed that the various malls are built by Assessee and are operated from the year 2001. The operational in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Such amenities and facilities are not the basic facilities required for occupation of a shop room by a tenant. They are the special facilities for running the shopping mall and are meant to attract the customers and provide them the comfort and convenience of shopping. In cases where the income received is not from the bare letting out the property but on account of the facilities and services rendered, the operations involved in such letting out is in the nature of business and the income derived therefrom has to be treated as business income and not income from property. The income derived by the assessee cannot be regarded as simply from the exercise of property right. Where the assessee company has developed the shopping mall and let out the same by providing a variety of services, facilities and amenities in the mall, it can be found that the primary intention of the assessee was commercial exploitation of the property and where it has derived substantial part of its income by such activity, which constitutes its main business, the income so derived would be business income of the assessee. We, therefore, agree with the view of the Tribunal that the income derived by the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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