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TMI Blog2022 (6) TMI 570X X X X Extracts X X X X X X X X Extracts X X X X ..... ned CIT(A) erred in law and on facts in confirming the action of AO in holding that the amount of Rs. 18,98,100/- is received on account of services provided by the assessee. On the facts and circumstances of the case there is no regular activity of earning profit by providing services. The learned authorities failed to appreciate that the expenditure incurred by the assessee is common maintenance expenditure for the premises. The addition on such basis is highly unjustified. (4) That the learned CIT(A) erred in law and on facts in confirming the action of AO in not considering the amount received as "Service Charges and Common Maintenance Charges" in proper perspective. On the facts and in circumstances of the case the amount received as service charges and common maintenance charges is part and parcel of rent and the action of the learned authorities in not considering the same in Annual letting value is highly unjustified. (5) That the learned CIT(A) erred in law and on facts in confirming the action of AO in not allowing interest of Rs. 1,36,407/- being interest paid to Saraswat Corporative Bank. On the facts and circumstances of the case the learned authorities failed to c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts and in circumstances of the case the action is unjustified. (13) That the learned Assessing Officer erred in law and on facts in charging interest u/s. 234A and 234B of the Income Tax Act and the learned CIT(A) erred in confirming the action of the AO. (14) That for any other ground with kind permission of your honour at the time of hearing of appeal. 2. Ground No.1 is general in nature and ground no. 13 is consequential in nature, it does not require any separate adjudication. Further, during the course of hearing, the ld. AR did not press ground No.6. Hence, the same is dismissed as not pressed. 3. Regarding ground No. 2 to 4 and ground No. 7, the ld. AR submitted that these relates to two agreements of leave license and service charges, which were entered into by the assessee in respect of which, the assessee has offered the income under the head "income from house property", whereas the Assessing Officer has brought the same under head "income from other sources". It was submitted that both this agreements were duly produced before the Assessing Officer as well as before the ld. CIT(A) and are part of the assessment and the appellate records and there is no dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not predominant over the letting activity. Further, our reference was drawn to the relevant provisions in the service agreement executed by the assessee with IDBI Bank Ltd. and it was submitted that identical provisions are executed in agreement with ICICI prudential Life Insurance and CITI Corp Finance India Ltd. with the small variation in case of CIT Corp Finance India Ltd., wherein the power backup in form of inverter facility has also been provided to the tenant. It was accordingly submitted that the findings of the ld.CIT(A) that the services are independent of the rent agreement signed separately by assessee is factually incorrect. Further, reliance was placed on the Hon'ble Bombay High Court decision in the case of CIT v/s. National Storage (P) Ltd. 48 ITR 577 as well as decision of Hon'ble Calcutta High Court in case of CIT v/s. Shambhu Investments(P) Ltd. 249 ITR 47. It was submitted that both the decisions have subsequently been affirmed by the Hon'ble Supreme Court. 4. Per contra, the ld. DR has relied on the findings of the Assessing Officer as well as the ld.CIT(A). 5. We have heard the rival contentions and perused the material available on record. On close re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve to be assessed under the head 'Income from house property". The matter is thus decided in favour of the assessee and the grounds of appeal are disposed off accordingly. 6. Regarding ground No. 5, the ld. AR submitted that disallowance is made of interest paid to Saraswat Co-opertative Bank amounting to . 1,36,407/- holding that the loan taken from the bank is not used towards house property and that the same was obtained to be utilized for investment in sponge iron project and the said findings has since been confirmed by the ld.CIT(A). 7. It was submitted that the loan was taken from Saraswat Co-op Bank and interest of . 1,36,407/- was incurred for the purpose of repayment of earlier housing loan of Bank of India Ltd., the loan was secured by way of equitable mortgage on house property and the sanction letter from Saraswat co-operative Bank was produced before the Assessing Officer and the ld.CIT(A) and necessary explanations along with bank statements were also furnished. Alternatively, it was submitted that where the claim of the assessee that the amount was utilized for repayment of earlier loans obtained for the purpose of housing is not accepted then in such a scenario d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to business purposes. In the instant case, the AO has determined 15% as relatable to personal and non-business purposes which we found reasonable and in light of the same, we see no justifiable basis to interfere with the findings of the ld CIT(A) and the same is hereby confirmed and the ground so taken by the assessee is dismissed. 13. Regarding ground No.9, it was submitted by the ld AR that the addition of Rs 15,476/- is made by the Assessing Officer on the basis of TDS certificate mentioning interest income of . 43,524/- received from UCO Bank. The ld. AR submitted that it was explained before the ld.CIT(A) that TDS certificate was incorrect and the assessee actually received interest of . 28,048/- from UCO Bank, which was duly reflected in the bank statement as well as books of accounts and therefore, the addition made merely on the basis of TDS certificate is unjustified and same may be directed to be deleted. 14. Per contra, the ld. DR has relied on the findings of the Assessing Officer as well as the ld.CIT(A). 15. We have heard the rival contentions and perused the material available on record. The AO has returned a finding that the assessee has reported interest income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e however not supported by any documentation and in such a scenario, we do not see any infirmity in the action of the AO and in action of the ld CIT(A) in confirming the same. In light of the same, we do not see any justifiable basis to interfere with the findings of the ld CIT(A) and the same are hereby confirmed and the ground of appeal taken by the assessee is dismissed. 19. Regarding ground No.11, wherein the ld.CIT(A) has confirmed the addition of . 1,35,000/- under section 68 of the Act. It was submitted by the ld AR that the same relates to loan transactions and in respect of two persons namely Umesh Gupta and Dilip Thakre, the assessee has furnished the confirmation and in respect of remaining loan transaction from different persons amounting to . 1 lakh, the name of these persons were submitted. It was submitted that these two confirmations filed by the assessee before the Assessing Officer were not considered either by the Assessing Officer or by the ld. CIT(A). It was submitted that these are small transactions and duly reflected in regular books of accounts. No evidence was found of unaccounted income being used as cash credit. Therefore, the addition may kindly be del ..... X X X X Extracts X X X X X X X X Extracts X X X X
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