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section 14A r.w.r. 8D are very much applicable in this case and disallowed Rs. 1,47,97,219/-.`

5. With regard to rental income, assessee explained that he had entered into rental agreement with M/s Spanco BPO Services Ltd. The said company had made payment of rent as well as reimbursement of electricity up-to the financial year 2009-10 regularly. Thereafter, the said tenant (M/s Spanco BPO Services Ltd) did not make any payment due to financial constrains. Only a part payment of reimbursement of electricity and outstanding opening balance was paid by M/s Spanco BPO Services Ltd. Ultimately, M/s Spanco BPO Services Ltd vacated the premises in November 2011. The assessee has further submitted that though M/s Spanco BPO Services Ltd has made TDS & deposited the same into Government Account, but no rent has been received by the assessee. Therefore the assessee has not disclosed such rental income in the return of income. The assessee has also taken support of Rule 4 of Income tax Rules 1962 for unrealized rent.

9. Aggrieved with the above order, assessee is in appeal before us on the grounds mentioned below:-

1. i) The Commissioner of Income Tax(Appeals) - 53, Mumbai erred in confirming the addition of Rs.3,85,85,341/- made by the AO, being unrealized rent receivable from licensee M/s. Spanco BPO Services Pvt. Ltd and M/s Spanko Respondez BPO Private Limited.(hereinafter referred to as SPANKO) Your Appellant submits that it has not received any rent from these Licensees and hence no income is offered to tax.

amend the aforesaid grounds of appeal.

10. At the time of hearing, Ld. AR appearing on behalf of the assessee submitted with regard to rental income that assessee entered into L & L agreement in the previous year 2007-2008 with Spanco Telesystems and Solutions Ltd. for giving 4 floors namely 5th, 6th, 7th and 13th floor on leave and license in Infotech Park at Vashi, Navi Mumbai and brought to our notice at page 60 to 98 of the paper book. In April 2008, Spanco Telesystems and Solutions Ltd. informed the Assessee of the slump sale of their unit to Spanco BPO Services Ltd. and Spanco Respondez BPO Pvt. Ltd. and requested the assessee to substitute the names of these new companies as licensee in the assessee's books of accounts. It was submitted that the licensees stopped paying the rent from F.Y. 2010-11 relevant to A.Y. 2011-12 citing financial problems. The closing balance as on 31st March 2011 on account of rent dues was Rs.15.60 cr. However, on a lot of persuasion the licensees paid Rs. 10.51 cr. in the previous year 2011-12 relevant to A.Y. 2012-13 towards old outstanding leaving still the balance of Rs. 7.09 cr. being outstanding rent for the period prior to A.Y. 2012-13. Inspite of the same, the assessee offered rental income I.T.A. No. 633/Mum/2019 M/s Vishwaroop Infotech Pvt. Ltd.

16. On the other hand, Ld. DR relied on the orders passed by the revenue authorities.

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I.T.A. No. 633/Mum/2019 M/s Vishwaroop Infotech Pvt. Ltd.

17. Considered the rival submission and material placed on record. We notice from the record that assessee has not received the rent to the extent of Rs. 3,85,85,341/- and the revenue is not disputing the fact. The assessee gave the property at Vashi, Navi Mumbai consisting of 5th, 6th, 7th and 13th Floor to M/s. Spanco Telesystems and Solutions Ltd, on Leave and License basis. Subsequently, the Spanco Telesystems informed the assessee about the slump sale of their business to M/s. Spanco BPO Services Ltd. and Spanco Respondez BPO Pvt. Ltd. and requested the assessee to substitute the names of these new Companies as licensee in their place w.e.f. 01.04.2008. Due to financial problems in the new companies, they stopped making payment towards rent from F.Y. 2010-11 relevant to A.Y. 2011-