Ita/74/2012 Of The Commissioner Of Income Tax v. M/S. Information Technology Park Lt.d

IN THR HIGH COURT OF KARNATAKA AT BENGALURUDATED THIS THE 21 DAY OF SKHPTRBMBER 2016 PRESENT THE HON’BLE MR.JUSTICE JAYANT PATEL AND THR HON’BLE MR.JUSTICK ARAVIND KUMAR| ITA NO.74/2012C/WITA NO.79/2012C/WITA NO.80/2012C/WITA NO.81/2012 IN ITA NO.74/2012:BETWEEN: 1. THE COMMISSIONER OF INCOME-TAX| C R BUILDING,QUEENS ROAD,BANGALORE. | 2. LHE INCOME-TAX OFFICER, |WARD-11(2),C R BUILDING,QUEENS ROAD,BANGALORE. ... APPELLANTS (BY SRI.K V ARAVIND, ADVOCATE)| AND: M/S. INFORMATION TECHNOLOGY PARK LTD., —ITPL, WHITEFIELD ROAD,BANGALORE.| _. RESPONDENT (BY SMT.TANMAYEE RAJKUMAR, ADVOCATE FORM/S. KING & PARTRIDGE) THIS APPEAL IS FILED U/S.2600-A OF LT. ACT, 1961ARISING OUT OF ORDEBR DATBRD 30-11-2011 PASSED IN [TNO.1148/BANG/2010, FOR THE ASSESSMENT YEAR 2000-2001,PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OFLAW STATED THRRBIN AND ALLOW THR APPBAL AND SBT ASIDETHE ORDER DATED 30/11/2011 PASSED BY THE MITAT,BANGALORE IN ITA NO.1148/BANG/2010 CONFIRMING THE.ORDER OF THR APPBHLLATE COMMISSIONER AND CONFIRM THEORDER PASSED BY THE INCOME TAX OFFICER, WARD-11(2),.BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. IN ITA NO.79/2012:BETWEEN: 1. THE COMMISSIONER OF INCOME-TAX|C R BUILDING,QUEENS ROAD,BANGALORE. | 2. THE INCOME-TAX OFFICER, |WARD-11(2), |C R BUILDING,QUEENS ROAD,BANGALORE.|_.. APPELLANTS (BY SRIL.K V ARAVIND, ADVOCATE) AND: M/S. INFORMATION TECHNOLOGY PARK LTD.,.ITPL, WHITEFIELD ROAD,BANGALORE.| _. RESPONDENT (BY SMT. TANMAYEE RAJKUMAR, ADVOCATE FORM/S.KING AND PARTRIDGE) THIS ITA IS FILED U/S.2600-A OF I.T. ACT, 1961 ARISINGOUTORORDERDATED|30-11-2011PASSEDIN|ITA.NO.1149/BANG/2010, FOR THE ASSESSMENT YEAR 2001-2002,PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OFLAW STATED THERBIN AND ALLOW THE APPBKAL AND SEIT ASIDTHE ORDER DATED 30/11/2011 PASSED BY THE MITAT, BANGALRE IN ITA NO.1149/BANG/2010 CONFIRMING THE.ORDER OF THR APPBHLLATE COMMISSIONER AND CONFIRM THEORDER PASSED BY THE INCOME TAX OFFICER, WARD-11(2),.BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. IN ITA NO.80/2012:BETWEEN: 1. THE COMMISSIONER OF INCOME-TAX,C R BUILDING,QUEENS ROAD, BANGALORE. | 2. LHE INCOME-TAX OFFICER, | WARD —- 11(2), C R BUILDING,QUEENS ROAD,BANGALORE.| _.. APPELLANTS (BY SRI.K.V.ARAVIND, ADVOCATE)| AND: M/S. INFORMATION TECHNOLOGY PARK LTD., ©ITPL,. WHITEFIELD ROAD,BANGALORE.| _. RESPONDENT (BY SRI.TANMAYEE RAJKUMAR, ADVOCATE FORM/S. KING AND PARTRIDGE) THIS ITA IS FILED U/S.260-A OF I.T. ACT, 1961 ARISINGOUTOFORDERDATRBR30-11-2011.PASSEDIN|ITA|NO.1150/BANG/2010, FOR THE ASSESSMENT YEAR 2002-20038,PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OFLAW STATED THRRBIN AND ALLOW THR APPBAL AND SBT ASIDETHE ORDER DATED 30/11/2011 PASSED BY THE ITAT,.BANGALORE IN ITA NO.1150/BANG/2010 CONFIRMING THE.ORDER OF THR APPBHLLATE COMMISSIONER AND CONFIRM THEORDER PASSED BY THE INCOME TAX OFFICER, WARD-11(2),.BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. IN ITA NO.81/2012:BETWEEN: 1. THE COMMISSIONER OF INCOME-TAX,C R BUILDING,QUEENS ROAD,BANGALORE. | 2. LHE INCOME-TAX OFFICER, |WARD-11(2), |C R BUILDING,QUEENS ROAD,BANGALORE.| _.. APPELLANTS (BY SRI.K.V.ARAVIND, ADVOCATE)| AND: M/S. INFORMATION TECHNOLOGY PARK LTD., —ITPL, WHITEFIELD ROAD,BANGALORE. ... RESPONDENT (BY SMT.TANMAYEE RAJKUMAR, ADVOCATE FORM/S. KING AND PARTRIDGE) THIS ITA IS FILED U/S.2600-A OF I.T. ACT, 1961 ARISINGOUTOFORDERDATED|30-11-2011.PASSEDIN|ITA.NO.1151/BANG/2010, FOR THE ASSESSMENT YEAR 2003-2004, PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF.LAW STATHBHD THRERBIN AND ALLOW THR APPBAL AND SET ASITHE ORDER DATED 30/11/2011 PASSED BY THE ITAT,|BANGALORE IN ITA NO.1151/BANG/2010 CONFIRMING THE)ORDER OF THE APPBELLATE COMMISSIONBR AND CONFIRM THEORDER PASSED BY THE INCOME TAX OFFICER, WARD-11(2),|BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. | THESE APPEALS COMING ON FOR HEARING THIS DAY,JAYANT PATEL J., DELIVERED THE FOLLOWING: JUDGMENT AND: M/S. INFORMATION TECHNOLOGY PARK LTD., —ITPL, WHITEFIELD ROAD,BANGALORE. ... RESPONDENT (BY SMT.TANMAYEE RAJKUMAR, ADVOCATE FORM/S. KING AND PARTRIDGE) THIS ITA IS FILED U/S.2600-A OF I.T. ACT, 1961 ARISINGOUTOFORDERDATED|30-11-2011.PASSEDIN|ITA.NO.1151/BANG/2010, FOR THE ASSESSMENT YEAR 2003-2004, PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF.LAW STATHBHD THRERBIN AND ALLOW THR APPBAL AND SET ASITHE ORDER DATED 30/11/2011 PASSED BY THE ITAT,|BANGALORE IN ITA NO.1151/BANG/2010 CONFIRMING THE)ORDER OF THE APPBELLATE COMMISSIONBR AND CONFIRM THEORDER PASSED BY THE INCOME TAX OFFICER, WARD-11(2),|BANGALORE, IN THE INTEREST OF JUSTICE AND EQUITY. | THESE APPEALS COMING ON FOR HEARING THIS DAY,JAYANT PATEL J., DELIVERED THE FOLLOWING: JUDGMENT These matters arise from the common Judgment and orderpassed by the Tribunal in ITA No.1147 to 1152/Bang/2010. | 2. It has been brought to our notice by the learned counselappearing for the appellant that one of the matters being ITA|1192/Bang/2010 was carried before this Court in ITA No.76/2012C/w ITA No.78/2012 and this Court for the reasons recorded in theorder dated 30.4.2014 has not interfered with the view taken by theTribunal and the appeals were dismissed. 3. We may record that this Court in the decision rendered inITA 76 & 78 ot 2012 has observed thus: | “These Income Tax appeals are filed by theRevenue under Section QOO0OA of the Income TaAct, 1961 (for short ‘the Act’), being aggrieved bythe order dated 30-11-2011 in ITA.Nos.1147-1192/Bang/2010 passed by the Income TaxAppellate Tribunal, Bangalore Bench ‘B’ (for short‘the Tribunal’) whereby the Tribunal dismissed theappeals filed by the revenue and confirmed theorder.dated23-07-2010.passedby|the.CommissioneroT|IncomeTax|(Appeals)-IV,Bangalore, (hereinafter referred to as °the First AppellateAuthority’),whereinthe.FirstAppellate Authority held that rental incomereceived by the assessee from letting out buildingsalong with other amenities in Software TechnologyPark falls under the head of ‘business income’and not under the ‘Income from house property’while setting aside the order passed by theAssessing Authority for the assessment years.1999-2000 to JOO4-05. 2 |since the common question of law andfacts are involved in these two appeals and a.common order passed by the Tribunal has been.challenged,theseTWO|appeals aI €clubbedtogether and disposed of by this common order. 3.The above appeals are admitted toconsider the following substantial question of law: “Whether the Tribunal wascorrect in holding that the lease|rent received by the assesseefrom letting out buildings along)with other amenities in a SoftwareTechnology Park is chargeable totax under the head ‘income frombusiness’ and not under the head|‘Income from house property’ asheld by this Hon’ble Court in|Bhoopalam Commercial Complex& Industries and by the Apex|Court in East India Housing &Land Development Trust Ltd.? 4Learned counsel appearing for theparties submitted that the substantial question oflaw raised in these appeals are fully covered by thejudgment reported in.(2013) 218 Taxman 88(Karnataka)1. in the case oCOMMISSIONER OFINCOME TAX-III v/s VELANKANI INFORMATIONSYSTEMS (P) LTD 5.|Division Bench oft this Court in theabove said judgment at paragraph 26 has clearlyheld as under: “Whether the Tribunal wascorrect in holding that the lease|rent received by the assesseefrom letting out buildings along)with other amenities in a SoftwareTechnology Park is chargeable totax under the head ‘income frombusiness’ and not under the head|‘Income from house property’ asheld by this Hon’ble Court in|Bhoopalam Commercial Complex& Industries and by the Apex|Court in East India Housing &Land Development Trust Ltd.? 4Learned counsel appearing for theparties submitted that the substantial question oflaw raised in these appeals are fully covered by thejudgment reported in.(2013) 218 Taxman 88(Karnataka)1. in the case oCOMMISSIONER OFINCOME TAX-III v/s VELANKANI INFORMATIONSYSTEMS (P) LTD 5.|Division Bench oft this Court in theabove said judgment at paragraph 26 has clearlyheld as under: 20............... If the intentexploit commercial property by puttingup construction and letting it out for thepurpose of getting rental income, thennotwithstandingthe|factthatthefurniture and fittings are provided to thelessee, the income from the building fallunder the head ‘income from houseproperty. But uf the assessee is in thebusiness of taking land, putting upcommercialbuildingsthereonand.letting out such buildings with allfurniture as his profession or business,then notwithstanding the fact that hehas constructed a building and he hasalso provided other facilities and even tfthere are two separate rental deeds, itdoes not fall within the heading ofincome from house property. Therefore,firstly what is the intention behind thelease and secondly what are_ thefacilities given along with the buildingsand documents executed in respect ofeach of them 1s to be seen. Thirdly it istO be|foundOUT|whetherit1S inseparableOrnot.Iftheyare inseparable and the intention is to carryon the business of letting out thecommercial property and carrying atcomplex commercial activity and gettingrental income therefrom, then such arental income falls under the heading ofproftts|and.gainsof|businessOrprofession.” 6. We are in respectful agreement withthe judgment of the Division Bench of this Court.Inthe instantCaS€@Ethe asse€ssce-Compa lengaged in the business of developing, operatingand maintaining an industrial park and providinginfrastructure facilities to different companies asits business. In view of that, the substantialquestion of law is held against the Revenue.Accordingly, these two appeals are dismissed.” 4. As all the appeals arise from the common order of theTribunal in respect of the very assessee but for the dlitfferenassessment year, question of law has been answered in favour otfassessee, the same should be the view as has been taken by this|Court in the above referred matter. ,���/98/ �3./�H:/03579�0.2@@�0329;�290B/4/;�2<25903�3./� �/C/9:/���==/2@0�0.2@@�0329;�;501500/;��� �D%�� ����������� �����������