O R D E R

PER SHRI PRAKASH CHAND YADAV, JUDICIAL MEMBER :

The present appeal of the assessee is arising from the order passed by the NFAC, Delhi dated 08/12/2023 in DIN No. ITBA/NFAC/S/

250/2023-24/1058596316(1) for the assessment year 2018-19.

2. The assessee is a partnership firm, earning income from ‘house property and other sources with regard to maintenance charges received from tenants and expenditure incurred for such maintenance. The assessee is assed to income tax with NFAC, Delhi. The assessee for the assessment year 2018-19 filed return of income on 5/7/2018, admitting total income of Rs.23,25,75,820/-, which included Rs.14,18,58,808/- under ‘’income from house property’’, Rs.6,30,38,931/- under‘’ income from capital gains’’ and Rs.2,76,78,077/- under ‘’income from other sources’’ including interest received on bank deposits. The notice u/s 143(2) & 142(1) of the Act were issued to the assessee calling for certain details. In response to the said notice, the assessee submitted all the required details and statements vide submissions vide dated 27/2/2020, 31/12/2020 and

17/2/2021.

2.’1 Further, the AO issued show notice cause notice on 23/4/2021 proposing to make an addition of Rs.2,24,28,827/- by disallowing the expenditure claimed against income from other sources. The asessee filed objection on 25/4/2021 against proposed disallowance with clarifications with regard to expenditure incurred and claimed u/s 57 oof the Act against income from other sources’’.

2.2 The AO without considering the explanations and clarifications furnished on the basis of audited financial statements and the computation of total income, has concluded the assessment by making the addition of Rs.2,24,28,927/- to the admitted income by disallowing portion of expenditure claimed in relation to income from other sources( Maintenance Charges), thereby assessing the income at Rs.25,50,04,647/- and subjecting the assessee to excess tax and interest of Rs.1,09,44,628/-.

3. At the time of hearing the ld. Counsel for the assessee took the Bench towards the additional grounds filed by assessee vide its application dated 5/2/2024. Ld Counsel fairly conceded that he would not press these grounds and argue the merits of the case. Ld Counsel has also acknowledged the averment of not pressing the additional grounds by putting his signature on the application dated 05.02.2024.

4. In rest of the grounds, the solitary issue involved is the taxability of the amount of Rs.6,07,97,039/- being maintenance charges under the “Income from other sources”(IOS) or “Income from House Property(IHP). It is the cases of the Revenue this 6.07 Cr is to be taxed under the head IHP, as held by the ld. CIT(A) and assessee deserves only 30% of deduction on this amount. On the other hand counsel for the assessee mainly contended that, considering the past history and the subsequent history of the assessee’s case this amount is to be taxed under the head IOS and accordingly, expenses attributable to this amount may kindly be allowed in terms of the provision of sec. 57 of the Income-tax Act. Ld Counsel has relied on the following judgments for the proposition that Maintence charges to be taxed under the head IOS and not IHP.

a) Rayla Corporation Vs ACIT 142 taxman.com 581(Mad).Copy of the judgment is at Pg No- 19-21 of case law compilation.

b) Tarapore & Com- 125 Taxman 446(Mad)- Copy of the judgment is at Pg No- 17-19 of case law compilation c) DC Shah Vs CIT 1 Taxman 545(Kar)

5 The ld.DR relied upon the orders of the authorities below.

6. After considering the rival submissions, we observe amount of Rs.6,07,97,039/-, claim to be maintenance charges, charged from the tenants for maintaining the lift, air conditioning, power back-up etc. We have perused the relevant clauses of the lease agreement and observed that these charges were for maintaining lift, air conditioning, power back- up etc. Which means they were not derived from any house rather the same were linked to some amenities, menti