Supreme Court: Courts Have Sometimes Failed Arbitration, With Interference Curing No Disease  ||  Supreme Court: Co-Heir Cannot Sell Other Heirs' Shares as Karta After Intestate Succession  ||  SC: Casual Labourers With Temporary Status are Eligible For Pension Even Without Regularisation  ||  Supreme Court: High Courts Must Record the Nature of Crime and Allegations While Quashing FIRs  ||  Delhi HC Rejected Pernod Ricard’s Plea Against Denial of Wholesale Liquor License over Excise Case  ||  Gujarat HC: Lalita Kumari Ruling Does Not Permit Deceased’s Kin to Invoke Art 226 For FIR Failure  ||  Ker HC: Denying Disability Pension to Army Personnel Based on Unreasoned Medical Opinion is Invalid  ||  Kerala HC Directs Family Courts to Follow Calcutta HC Custody Guidelines Till State Rules Framed  ||  Allahabad HC Allows LIC Employees to Be Engaged as Census Enumerators and Supervisors For Duties  ||  Supreme Court Unveiled Victim Protection Plan For Trafficking Survivors and Urged Legal Reforms    

Neelyog Builders P.Ltd, Mumbai vs. Acit - (Income Tax Appellate Tribunal) (28 Sep 2023)

Common maintenance charges cannot be termed as the income of the assessee

MANU/IU/0847/2023

Direct Taxation

The only dispute raised by the assessee is against the taxation of maintenance charges in its hands as income from house property. The Assessing Officer ("AO") vide order, passed under Section 143(3) of the Act held that, no documentary evidence has been furnished by the assessee to prove that, the said sum of Rs.13,00,659, was received by it as maintenance charges. Accordingly, the AO added the aforesaid amount to the total income of the assessee under the head "income from house property".

The learned CIT(A), vide impugned order, dismissed the appeal filed by the assessee and held that, the tenants have deducted TDS on the gross amount which is inclusive of the maintenance charge and the assessee has claimed the entire TDS. The learned CIT(A) further held that, while computing the gross rent received by the house owner, it has to be inclusive of the maintenance charge since payment of maintenance charges is the liability of the house owner.

As per the assessee, the amount of maintenance charges whenever received were deposited in a separate bank account not belonging to the assessee but maintained by the Kapole Co-operative Bank Ltd. Society for the specific purpose of collecting maintenance charges and making payments therefrom for the purpose for which said sum was collected. Accordingly, the assessee claimed that the amount of Rs.13,00,659, was never received by the assessee and the maintenance charges given by three parties were neither the receipt of the income of the assessee as the said charges were not forming part of the receipt of the assessee rather it was deposited in a separate account which was exclusively used by the assessee for maintenance charges.

The taxability of maintenance charges in the hands of the assessee came up for consideration before the Co-ordinate Bench of the Tribunal in assessee's own case in Neelyog Builders Private Limited v/s DCIT, for the assessment year 2012-13. The Co-ordinate Bench, vide order decided a similar issue in favour of the assessee and held that, the common maintenance charges cannot be termed as the income of the assessee.

The learned Departmental Representative neither could show any reason to deviate from the conclusion so reached by the Co-ordinate Bench in the aforesaid decision nor any change in facts or law was alleged. Thus, respectfully following the decision of the Co-ordinate Bench in assessee's own case, present Tribunal delete the addition made by the AO on account of maintenance charges. It is further directed that the TDS credit if any granted to the assessee in respect of the maintenance charges be withdrawn. The impugned order passed by the learned CIT(A) is set aside. The appeal by the assessee is partly allowed.

Tags : MAINTENANCE CHARGES   TAX   LEVY  

Share :        

Disclaimer | Copyright 2026 - All Rights Reserved