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TMI Blog2002 (9) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... es. In the context of the facts of that case, the court held that the amounts paid to the lessors by the sub-lessees constituted business income. - The Tribunal was in error in holding that the rental income derived by the assessee was required to be treated as business income and not as income from property. The question referred to us is answered in favour of the Revenue and against the assessee. - - - - - Dated:- 2-9-2002 - Judge(s) : R. JAYASIMHA BABU., K. RAVIRAJA PANDIAN. JUDGMENT The judgment of the court was delivered by R. JAYASIMHA BABU J.-The assessment years are 1984-85 to 1988-89. The question referred in these tax cases is: "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g and developing markets. While examining its claim that the rents it received from the shops and stalls formed its business income and should be assessed as such, the court observed that the income derived from letting out property belonging to the appellant did not constitute "profits and gains" from business within the meaning of sections 6 and 10 of the Indian Income-tax Act, 1922. The court referred to section 6 of that Act which categorised income under six different heads and observed that: "This classification under distinct heads of income, profits and gains is made having regard to the sources from which the income is derived. Income-tax is undoubtedly levied on the total taxable income of the taxpayer and the tax levied is a si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shorter periods and paid rental for such use. The case of Karanpura Development Co. Ltd. v. CIT [1962] 44 ITR 362 (SC) relied upon by the Tribunal, dealt with the case of sub-lease given by a company which had acquired coal mining leases over large areas and the object of the company was to acquire such leases, develop them as coalfields and then sub-lease them to collieries and other companies. In the context of the facts of that case, the court held that the amounts paid to the lessors by the sub-lessees constituted business income. The Tribunal was in error in holding that the rental income derived by the assessee was required to be treated as business income and not as income from property. The question referred to us is answered ..... X X X X Extracts X X X X X X X X Extracts X X X X
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