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2019 (10) TMI 1002 - HC - Income TaxCorrect head of Income - Income from business or income from house property or income from other sources - property acquired by the assessee and subsequently entered into an agreement with GAIL and the receipts at the hand of assessee pursuant to the agreements - HELD THAT:- In the present case, the AO found sufficient materials and changes in the year under consideration, as he after examining the relevant clauses of agreements formed an opinion that the property was taken on lease for giving it on rent to GAIL. Further, Section 2(13) defines business, which includes any trade, commerce or manufacture or adventure or concerned in the nature of trade, commerce or manufacture. In the present case no business activity was being carried out by the assessee as business is a continuous and systematic activity carried on with a view to earn profit. Further, the records of the assessee revealed that only one person was employed, which cannot go on to establish the fact that any business activity was being carried out by the appellant, and the premises was only let out to GAIL pursuant to the agreement and was thus rightly assessed by the Assessing Officer under the heading 'income from house property and income from other sources'. In a similar set of fact, the Bombay High Court in case of Mangla Homes Pvt. Ltd. vs. Income Tax Officer [2008 (8) TMI 522 - BOMBAY HIGH COURT] following the decision of the Apex Court in case of East India Housing and Land Development Trust Ltd. v. CIT [1960 (11) TMI 7 - SUPREME COURT] held that income derived by the company from shops and stalls is income received from property and falls under the specific head described in Section 9 being income from property. AO after examining all the three agreements found that the assessee did not indulge in any kind of recurring, systematic and in organized manner, business activity and having only one employee rightly assessed the receipts under the heading 'income from house property and income from other sources'. In depth and the findings recorded by the authorities below, we are of the considered opinion that as the appellant-assessee did not carry out any systematic, recurring and in organised manner, any business activity nor there was any volume, frequency, continuity and regularity of transactions, and only one person was employed by him for the management and look after of the leased property, the taxing authorities had rightly held the receipts to be income from house property and income from other sources and not business income.
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