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2014 (11) TMI 895 - HC - Income TaxRental income from letting out of warehouses – Business income or income from house property - Whether the Tribunal was justified in holding that the rental income from letting out of warehouses/godowns together with various services rendered to the occupant did not constitute a business activity of the appellant - Held that:- The Tribunal was rightly of the view that the income derived by the assessee by way of rent of such godowns from M/s. IPL is therefore cleraly liable to be taxed as “income from property” and not as “income from business” - the company had rendered certain incidental services for earning such rental income would not alter the nature of such income as being assessable under the head “income from house property” - whether any income falls under one head or the other has to be decided according to the common notions of practical and reasonable man for the act does not provide any guidance in the matter and that no general principle could be laid down which is applicable to all cases and each case has to be decided on its own facts and circumstances - assessee has not let out the constructed building but is providing complex service oriented activities - The return received by the assessee is not the income derived from the exercise of property rights only but is derived from carrying on an adventure in the nature of trade - If the entire conduct and series of activities undertaken by the assessee firm is examined right from the inception of firm, it is borne out that the assessee carried out the activities with a view to earn profit or gain rather than to earn income as an owner of the asset – thus, the Tribunal was justified in holding that the rental income from letting out of warehouses/godowns together with various services rendered to the occupant did not constitute a business activity and the income was not assessable u/s 28 as business income – Decided against assessee.
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