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2011 (1) TMI 763 - PUNJAB AND HARYANA HIGH COURTBusiness income or Income from house property - The assessee received income from letting out of a building but sought to treat the same as business income. However, the Assessing Officer treated the same as rental income relying upon judgment of Hon’ble Supreme Court in Shambhu Investment (P.) Ltd. v. CIT (2003 -TMI - 40351 - SUPREME Court) - Held that:- Whether the income falls under the head of business income or income from property has to be decided from case to case depending on the question whether transaction involved business activity or merely deriving rental income. One of the determining factors may be whether the transaction is normal part of business of the assessee. If business of the assessee has nothing to do with the renting of property and renting is an isolated transaction to earn property income, mere fact that such income will result in reduction of business loss is not enough to hold that it will fall under the head of business income. If this was to be the sole test, every rental income of a businessman has to be held to be business income which is not the statutory scheme as held by the Hon’ble Supreme Court particularly in East India Housing & Land Development Trust Ltd.’s case (1960 -TMI - 49490 - SUPREME Court). - the Tribunal was right in holding that the income derived by the assessee was from property and not business income. - Decided against the assessee.
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