COMMISSIONER OF INCOME TAX Vs. REEBOK INDIA COMPANY
HIGH COURT OF DELHI
COMMISSIONER OF INCOME TAX
REEBOK INDIA COMPANY
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V.B.GUPTA, J. -
(1.) Present appeal has been filed by the Revenue under Section 260A of the
Income Tax Act, 1961 (hereinafter referred to as Act) against the order dated
2nd September, 2005 passed by the Income Tax Appellate Tribunal, Delhi in
ITA(TDS) No.5/Del/2002 for the assessment year 1994-95.
(2.) The following substantial question of law has been framed by us for
"Whether the Income Tax Appellate Tribunal was correct in law in holding that
the amount of Rs.1,50,24,000/-(termed as security deposit) paid by the Assessee
to its landlord under the Agreement to Lease dated 10th March, 1995 was not
'rent' as defined in the Explanation to Section 194-I of the Income Tax Act,
(3.) The brief facts of this case are that the Assessee-company entered into
an agreement with M/s ABCO Footwear Care to take on lease the premises bearing
No.328/1, Village Bijwasan, New Delhi at a monthly rent of Rs.6,26,000/-. The
lease agreement also provided for payment of security deposit amounting to
Rs.1,50,24,000/- which was to be reduced every six months by an amount of rent
which became payable in accordance with the agreement. The Assessee deducted
tax at source under Section 194-I of the Act, on the actual payment of rent made
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