TMI Blog2023 (2) TMI 204X X X X Extracts X X X X X X X X Extracts X X X X ..... -10CCBBA certifying that the assessee satisfied all the conditions for claiming deduction under section 80-ID of the Act. No adverse comment in this regard has been made by the Ld. AO. We, therefore, uphold the finding of the Ld. CIT(A) that the income shown by the assessee is assessable as income from business and that the expenses claimed by the assessee thereagainst is an allowable deduction. It is also to be noted that the Revenue itself has accepted the claim of the assessee in AYs 2012-13 and 2014-15 - The facts remaining the same for the AY under consideration a different view is not tenable. Finding no substance in the appeal of the Revenue and no infirmity in the order of the Ld. CIT(A), we reject the Revenue s appeal. - ITA No. 4901/Del/2019 - - - Dated:- 30-1-2023 - N.K. Billaiya, Accountant Member And Ms. Astha Chandra, Judicial Member For the Department : Shri Vivek Vardhan, Sr. DR For the Assessee : Shri Arun Kishor, CA ORDER PER ASTHA CHANDRA, JM The appeal filed by the Revenue is directed against the order passed by the Ld. Commissioner of Income Tax (Appeals)-9, New Delhi ( CIT(A) ) dated 08.03.2019 pertaining to Assessment Year ( A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction under section 80-ID of the Act. Vide letter dated 28.11.2017, the assessee submitted that it got approval for a three star hotel in Goa with effect from 21.09.2013. Therefore, it has claimed proportionate deduction under section 80-ID for the period from 21.09.2013 to 31.03.2014 amounting to Rs.44,54,647 as per auditor s report. Necessary documents regarding ownership of the hotel property were produced before the Ld. Assessing Officer ( AO ). 4. The submission of the assessee was not acceptable to the Ld. AO. He found that the assessee company had taken the hotel property on rent which was subletted to M/s. Highest Cruises Entertainment Pvt. Ltd. and the assessee company received rental income only from subletting of its assets. He disbelieved the Revenue Sharing Agreement entered into between the assessee and M/s. Highest Cruises Entertainment Pvt. Ltd. saying that it was only a device in veil of which income from subletting is shown as income derived from the business of hotel located in the specified area. He, therefore, rejected the assessee s claim of deduction under section 80-ID of the Act holding that mere approval is not sufficient as the conditions prece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated manner along with the appellant as per the scope of work and responsibilities mutually agreed. The assessee company explained that it undertaken following business activities:- For increasing the profitability of joint business, the appellant has out of its own resources, during the current year with great effort has obtained Three Star rating from the Ministry of Tourism Govt, of India. The appellant as per its own leverage, corporate experience, knowledge is required to promote the brand for furtherance of joint business as per clause no. 8.9.2. The appellant had incurred costs on interior designer, decorator, consultant for the hotel who shall render design services for joint business - clause 8.9.3. HCEPL revenue sharing partner shall in consultation with the appellant carry out all advertising, marketing and other related promotional activities for the promotion of joint business of the two parties with a view to enhance the prospective business and common revenues - clause 8.1.2. It has incurred expenses on consultants for promotion, horticulture, advertising and marketing for joint business. 6.3 The appellant as an organizer of bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om that taken in earlier proceedings., the claim of the appellant for treating the receipt from business income deserves to be allowed. 6.7 Further after verification of facts and after considering the contentions of the assessing officer and submissions of the appellant, I find that in view of full compliance of conditions specified u/s 80ID of The IT Act, the appellant is entitled to claim incentive as provided u/s 80ID of The IT Act. In view of my detailed deliberation noted above, the claim of the appellant w.r.to treating the rental receipt as income from Business and Profession is upheld^ Consequently, the deduction u/s 80ID(2) is allowed. The AO is directed to compute and allow the same. Accordingly, the grounds no. 2 to 5 are allowed. 7 Ground no. 6 is directed against the assessing revenue from Business as Other Source income without allowing deduction of expenses incurred for earning of said income. The AO has hot given any finding or reason of not allowing said expenses. 7.1 I have gone through the nature of expenses incurred by the appellant company and debited to the Profit and Loss account of the appellant company. The expenses incurred by the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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