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TMI Blog2008 (5) TMI 293X X X X Extracts X X X X X X X X Extracts X X X X ..... re was carried on under the name and style of 'Mehta Business Centre' was owned by the assessee while the property in which the business centre was run under the name and style of 'Pravhar Business Centre' was taken on lease by the assessee. The receipts credited to Profit & Loss Account represented the amount received by the assessee from its customers for using the space of the assessee along with other facilities which were shown as service charges. The assessee was asked to explain as to why the gross service charges received by it should not be taken into consideration for computing the income under the head 'income from house property' since the source of the receipt was from letting out of the house property. The explanation of the assessee as noted by the Assessing Officer at page 2 of the assessment order was "the primary intention is to rent various business service centre facilities and incidentally the premises are allowed to be used. As such, the assessee is providing business centre services and not falling in the category of letting out the premises. The premises is allowed to be used or occupied incidentally for the purpose of utilising the b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... immovable property but the property was exploited for providing various services and use of the property was incidental. The copy of the agreement was furnished before the CIT(A) to point out that the following features emerged from the agreement: (i) The centre is operating at the centre premises for offering various business services/facilities on what is commonly known as business centre. (ii) In view of the other side being desirous of availing itself of the services thus offered by the centre at the centre premises, the parties have entered into an agreement. (iii) Under the agreement the appellant has granted to the company permission to use the services offered by him as a business centre services/facilities. (iv) For that purpose the company is allowed to occupy a particular portion of the premises. (v) The services offered are of use of office furniture like tables, chair, fans, etc., as also electric and electronic installations like air-conditioners, telephone, fax machine etc. (vi) Certain services are, jointly given to all the persons who enter into similar agreements The services are offered by the centre for an aggregate period of certain weeks. (vii) T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or specialised services had been provided by the assessee. According to him, the term 'complex' is equated with specialised services as stated in the case of National Storage Ltd., or those in a hospital building, theatre, etc. According to him, mere provision of bare minimum furniture would not amount to any specialised services. He also rejected the contention of the assessee regarding rule of consistency on the ground that each year is a different year. The order of the Assessing Officer was, therefore, confirmed by him. Aggrieved by the same, the assessee is in further appeal before the Tribunal. 6. The learned Counsel for the assessee has submitted before us that the intention of the assessee is not to let out the building or any part thereof but the intention is to provide space along with other facilities to its customers for their use for a specified period. It was also submitted that it is not a case where the property is let out to the other parties as a permanent lessee. According to him, the space in property is given on short term basis subject to availability of space and the customers keep on changing from time to time. In support of this submission, he has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. Rival submissions of the parties have been considered carefully. The question for our consideration is whether the income accruing to the assessee should be assessed as 'business income' as claimed by the assessee or partly as 'Income from house property' and partly as 'income from other sources' as held by the Assessing Officer. At the outset, we may mention that the Assessing Officer has committed a mistake in computing the income arising from sublet property inasmuch as service charges received have been considered under the head 'income from house property'. Having held that gross receipts received in respect of sublet property is chargeable to tax under the head 'income from other sources', the Assessing Officer could not consider the same under the head 'income from house property'. Thus, the expenditure related to such charges stood disallowed. This mistake needs rectification if it is held that such charges are assessable under the head 'income from other sources'. 8. Now let us adjudicate the real issue whether a receipt is a business receipt or a receipt from mere letting out of an immovable property would depend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... istic. In big cities, there is always shortage of space. Even the businessman for carrying out some specific work requires temporary space where business like facilities are provided. Even hotels are used for such purposes. To meet out such requirement, some businessmen open business centres where space is provided for temporary period along with business like facilities. For example, space is provided for holding conferences, exhibitions, seminars, etc. Sometimes, space is provided for weeks/months so that the customers may complete their assignment during that period. For example, a foreign enterprise may hire such premises for providing training to its constituents or to certain other persons. Sometimes, a businessman may require the space for carrying out some project which may be completed in few months. There are only illustrations to prove the point that temporary spacers provided by business centres to suit the requirement of their customers. Sometimes, there may be no customer and space may remain vacant. In such cases, the activity is to run business centre as a commercial activity like hotels and hospitals and use of the property is incidental to carrying on such busines ..... 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