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2014 (9) TMI 431 - HC - Income TaxAssessment of rental income from lease/finance – Business income of House property – Held that:- The assessee has not leased out the property merely as a land and building, but also with further conditions as to how the business of the lessees/franchiees should be conducted with regard to the hotel industry only - The Special conditions of contract make it clear that the name of the assessee should clearly indicated in the name Board and the name of the franchisee should be below the name of TTDC, making it clear that the TTDC continues to be operating their business through their franchisees - the Special conditions make it clear that the assessee corporation continues to be in the business of tourism activities, though not directly but through the franchisees and has received income as franchisee fee and that cannot be lost sight of while determining the nature of income. Tribunal rightly was of the view that the properties let out by the assessee are business assets of the assessee corporation, as they have not treated the leased out properties as non-business assets of the assessee-corporation - the assessee has given a special right or privilege to the franchisees to undertake a particular business in the property of the assessee on receipt of franchisee fee - the income is clearly in the nature of business income and not income from house property – thus, the order of the Tribunal is upheld – Decided against assessee.
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