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2016 (7) TMI 504 - AT - Income TaxRevision u/s 263 - Rental income received - treated as income from business or house property - Held that:- There is no break-up of the rent between facilities and shop area rented out. Obviously the lease deeds were composite. No doubt consistent view taken by various courts including Hon’ble Apex Court is that an assessee, even if it was in the business of real estate, income earned from letting out of property was to be assessed under the head ‘ income from house property’. Exception to this rule is where letting of the building was inseparable from letting of the plant, machinery and furniture in which case circumstance alone, it could be treated as income from business. This position of law has been clearly enunciated by the Hon’ble Madras High Court in the case of Keyaram Hotels (2014 (11) TMI 633 - MADRAS HIGH COURT ), after considering its own judgment in the case of Chennai Properties & Investments Ltd, (2003 (3) TMI 28 - MADRAS High Court ). AO was aware that assessee was in the business of real estate development and leasing of commercial space. This mentioned in the first sentence of the assessment order passed u/s.143(3) of the Act, which was the subject matter of the revisionary proceedings. So it is not a case where AO had not made enquiries. He was aware that assessee was into real estate development and leasing of commercial space. Assessee was required to file copies of lease deeds, specifically mentioning the types of services to be given by the assessee. AO thereafter assessed thes income of the assessee was to be considered under the head ‘income from business’. We cannot say that it is an illegal or unlawful view which was not possible in the facts and circumstances of the case. - Decided in favour of assessee
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