- (1.) This is an appeal against the order of the Income Tax Appellate Tribunal confirming the order of the Commissioner of Income Tax (Appeals) in respect of the issue that falls for consideration. The appeal pertains to the assessment year 2002-03.
(2.) The appeal is admitted on these following substantial questions of law which really raise only one point. i) Whether in the facts and circumstances of the case the maintenance charges could be included as part of rent ii) Whether in the facts and circumstances of the case interpretation given to Section 23 of Income Tax Act, 1961 is correct iii) Whether in the facts and circumstances of the case the maintenance charges given by the sub sub licensees to builder can be included as part of rent iv) Whether in the facts and circumstances of the case orders Annexures A-1 to A-3 are sustainable in law
(3.) The appellant is a sub-licencee of an apartment admeasuring 367 sq. feet in a commercial building. The assessee entered into a sub-sublicence agreement dated 03.05.2000 with one M/s RSM & Company. Clause-1 of the sub-sub-licence agreement reads as under:- "1. That the Sub-Licencee hereby demises unto the SubSub-Licencee all that the Demised Premises comprised of the area known and identified as Flat No. 412, measuring about 367 sq. ft. (super area), situated on the fourth floor of the commercial building known as World Trade Centre Barakhamba Lance, Connaught Circus, New Delhi-110001 and more specifically described in schedule I hereinbelow for the term of 2 (two) years commencing from the 1.5.2000 together with the right in the Sub-Sub-Licence and their employees and authorized agent/agents/visitors and staff to use in common with the other Sub-Sub-Licencee/occupants of the Building at all times during the terms of Sub-SubLicence Agreement hereby created for Office purpose connected with the Demised Premises, but not for any other purpose. (i) The main gate, doors, entrance hall, passages and the staircase and landings of and in the building leading to the Demised Premises for unrestricted ingress to and egress from the Building and the Demised Premises; and (ii) The passenger lifts, provided that nothing greater in weights and bulk other than handbags, brief case and attached cases shall be taken into passenger lifts; and the Sub-Sub-Licencee paying and yielding therefore unto the Sub-Licencee during the said period of terms:- (a) Rent in respect of the Demised Premises calculated @ Rs.40/- (Rupees Forty only) per sq. ft. (Super Area) total monthly rent is Rs.14,680/- (Rupees Fourteen thousand six hundred eighty only) of the area comprised in the Demised Premises, the said rent be paid quarterly in advance. The first payment, however, will be for two months (May & June, 2000). (b) In addition to the monthly rent, monthly and proportionately for any part of the month, all maintenance charges payable to the Builders, M/s Bharat Hotels Limited, as per their current bills in respect of the Demised Premises. Presently the maintenance charges fixed by the Builders are Rs.14.22 (Rupees fourteen and paisa twenty two only) per sq. ft. per month. All reasonable and future enhancements, if any, will also be to the Sub-Sub-Licencee account. Any abnormal increase will be to the Sub-Licencee account. However, any increases in maintenance charges due to increase in electricity tariff by N.D.M.C. would be to Sub-SubLicencee account.";