Commissioner Of Income Tax- Udaipur v. The Lake Palace Hotels & Motels Pvt. Ltd. City Palace, Udaipur

1 IN THE HIGH COURT OF JUDICATURE FORRAJASTHAN AT JODHPUR. (1) D.B. INCOME TAX APPEAL NO.64/2012 Commissioner of Income Tax- Udaipur vs. The Lake Palace Hotels & Motels Pvt. Ltd. City Palace, Udaipur. (2) D.B. INCOME TAX APPEAL NO.66/2012 Commissioner of Income Tax- Udaipurvs. The Lake Palace Hotels & Motels Pvt. Ltd. City Palace, Udaipur. (3) D.B. INCOME TAX APPEAL NO.67/2012 Commissioner of Income Tax- Udaipurvs. The Lake Palace Hotels & Motels Pvt. Ltd. City Palace, Udaipur. DATE OF ORDER :: 24.08.2016 HON'BLE MR. JUSTICE K.S. JHAVERIHON'BLE MR. JUSTICE GOVIND MATHUR Mr. K.K. Bissa, for the appellant. Mr. N.M. Ranka, Sr. Advocate with Mr. N.K. Jain and Mr. M. Aslam Naushad, for the respondents. ... By way of these appeals, the Revenue Department haschallenged the orders of the learned Tribunal whereby thelearned Tribunal dismissed the Revenue Appeals andconfirmed the orders of the CIT (A). Counsel for the appellant contended that the expenseswhich are done for the aircraft services will not fall within thepurview of the services of the Hotel and the lease, which hasbeen treated as business income and not income from othersources is the income from other sources. Following substantial questions of law are sought to be framed in the appeals: “(1) Whether on the facts & in the circumstancesof the case, the Hon’ble ITAT is legallyjustified and correct in Treating the amountreceived from Indian Hotel Co. Ltd. asbusiness income and not income from othersources.of the case, the Hon’ble ITAT is legallyjustified and correct in Treating the amountreceived from Indian Hotel Co. Ltd. asbusiness income and not income from othersources. (2)Whether on the facts & in the circumstancesof the case, the Hon’ble ITAT is legallyjustified and correct in deleting disallowanceof Rs.13,61,191/- made on account ofdelayed payment of PF and ESI.of the case, the Hon’ble ITAT is legallyjustified and correct in deleting disallowanceof Rs.13,61,191/- made on account ofdelayed payment of PF and ESI. (3)Whether on the facts & in the circumstancesof the case, the Hon’ble ITAT is legallyjustified and correct in deleting disallowanceof Rs.4,53,971/- out of deferred revenueexpenditure.of the case, the Hon’ble ITAT is legallyjustified and correct in deleting disallowanceof Rs.4,53,971/- out of deferred revenueexpenditure. (4)Whether on the facts & in the circumstancesof the case, the Hon’ble ITAT is legallyjustified and correct in reversing the decisionof the ld. CIT (A) in treating the receipt oflease rent of Rs.48,61,880/- and aircraftscharges of Rs.41,31,670/- as businessincome and not income from other sources.of the case, the Hon’ble ITAT is legallyjustified and correct in reversing the decisionof the ld. CIT (A) in treating the receipt oflease rent of Rs.48,61,880/- and aircraftscharges of Rs.41,31,670/- as businessincome and not income from other sources. (5)The order of the ITAT is perverse as it isagainst the material evidence on record andagainst the facts of the case.”against the material evidence on record andagainst the facts of the case.” Learned counsel for the appellant has placed reliance on the following decisions of the Gujarat High Court as well asKerala High Court:Kerala High Court: (1) Commissioner of Income-tax-II vs. Gujarat State Road Transport Corporation, reported in (2014) 41 taxmann.com 100 (Gujarat); and (2) Commissioner of Income-tax, Cochin vs. MerchemLtd., reported in (2015) 61 taxmann.com 119Ltd., reported in (2015) 61 taxmann.com 119 (Kerala) 3 (5)The order of the ITAT is perverse as it isagainst the material evidence on record andagainst the facts of the case.”against the material evidence on record andagainst the facts of the case.” Learned counsel for the appellant has placed reliance on the following decisions of the Gujarat High Court as well asKerala High Court:Kerala High Court: (1) Commissioner of Income-tax-II vs. Gujarat State Road Transport Corporation, reported in (2014) 41 taxmann.com 100 (Gujarat); and (2) Commissioner of Income-tax, Cochin vs. MerchemLtd., reported in (2015) 61 taxmann.com 119Ltd., reported in (2015) 61 taxmann.com 119 (Kerala) 3 However, counsel for the respondent has raisedpreliminary objections to the substantial questions of law andsubmits that no substantial question of law are liable to beframed against the finding of fact arrived by the learnedTribunal and the CIT and the income which has been raised byway of lease will fall within the purview of the property whichwas done by the assessee. We have gone through the orders passed by the CIT aswell as the learned Tribunal and the contention raised by thelearned counsel for the respondents that no substantialquestions are required to be framed. Even otherwise, theincome by lease was the property of the assessee and will fallwithin his income and the allowances which were for dailypayment for PF and ESI which has rightly been decided by theTribunal. In our view, no substantial questions of law are requiredto be framed. Consequently, the appeals being devoid of any meritdeserve to be dismissed and the same are hereby dismissed. A copy of this order be placed in each file. (GOVIND MATHUR),J. (K.S. JHAVERI),J. tikam daiyaItem No.34-36