Case Law Details
Mahesh Devdutta Gupta Vs ACIT (ITAT Nagpur)
Held that we are of the considered view that the predominant intention of entering into these agreements is letting out of the property and not provision of any independent services.
Facts-
The assessee entered into two agreements of leave license and service charges, in respect of which, the assessee has offered the income under the head “income from house property”, whereas the AO had brought the same under the head “income from other sources”. It was submitted that in the AY 2003–04, AO assessed income from rent and service charges received from ICICI Prudential Life Insurance Co. Ltd and IDBI Bank Ltd. as income from House property. CIT(A) invoked provisions of section 263 on the issue that deduction claimed under section 24(a) was not allowable on service charges.
Further, assessee also alleged disallowance of interest holding that loan taken from the bank is not used towards house property and the same was obtained to be utilized for investment in sponge iron project.
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