Itxa/2342/2009 Of The Commissioner Of Income Tax- 9 Mumbai v. Automann India Pvt Ltd

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.2342 OF 2009 The Commissioner of Income Tax ..Appellant. V/s. M/s. Automann India Pvt. Ltd. ..Respondent. Mr.Suresh Kumar for appellant. Mr.Balasaheb G. Yewale i/b. Rajesh Shah & Co. for respondent. CORAM : DR. D.Y.CHANDRACHUD AND J.P.DEVADHAR, JJ. DATED : 5TH JANUARY, 2010 P.C. :- 1.The following question of law has been framed in the appeal filed by the revenue against the judgment of the Income Tax Appellate Tribunal dated 20th November, 2008:- " Whether on the facts and circumstances of the case the Tribunal was justified in holding that conduction royalty amount received on letting out the business is "Business Income", without appreciating the fact that the entire business along with its commercial assets were leased out for a fixed monthly rent and there was no intention to carry out the business itself and therefore conduction royalty amount is to be taxed under "Income from other sources" ? " 2.The appeal pertains to the assessment year 2003-04. 3.The Tribunal arrived at a finding of fact, after considering the terms of the agreement entered into between the assessee and the third party that the assessee had effectively kept control of the business to itself. The term of the agreement was three years. The licenses and permits stood in the name of the assessee. The conductor agreed that on termination of the agreement or upon the expiry thereof, he would vacate the premises and remove himself and the equipment from the premises. In these circumstances, the Tribunal came to the conclusion that the royalty income from the conducting agreement was assessable as income from business. The finding of fact is based on a correct interpretation of the terms of the agreement. No substantial question of law arises in the appeal. The appeal is dismissed. No order as to costs. (J.P.DEVADHAR, J.) (DR. D.Y.CHANDRACHUD, J.)