TMI Blog2002 (7) TMI 231X X X X Extracts X X X X X X X X Extracts X X X X ..... ent, ground floor and first floor. The assessee had shown income from storage charges received from sundry parties for letting out of the basement as "income from other sources" and claimed therefrom various expenses incurred as deduction while computing the total income. The expenses also includes interest of Rs. 43,077 payable to M/s Debidutt Poddar Sons. Loan originally taken from M/s. Debidutt Poddar and Sons for acquisition of the aforesaid property was Rs. 1,50,000 only and the above interest of Rs. 43,077 includes interest on interest. According to the Assessing Officer, the income from letting out of the aforesaid property is to be assessed under the head "income from house property". The Assessing Officer also observed that no income was shown by the assessee from the ground floor and the first floor. She estimated the annual rateable value of the whole property at Rs. 1,20,000 and the same being more than storage charges received by the assessee, she took the annual value of the property at Rs. 1,20,000 and accordingly computed the income under the head "income from house property". In computing the said income, as the loan taken for acquisition of the property was Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vity of earning an income from making the building available to others for a charge for limited period is not to be equated with the letting out of a building on lease from month to month or year to year, wherein it would be said that the building was being exploited by, the owner to earn a rental income. Here the expression "letting out" is used only for a limited purpose. The building remains under the control of the owner. What is granted by the owner is only a licence for a prescribed fee for a specified period. This activity of the assessee can be described as a business carried on by the assessee with the intention of earning income from the building, the business being that of making available the building to others for a charge for a limited duration. The overall control of the building at all times being retained by the assessee." Observing as above, the Hon'ble Madras High Court held that the Tribunal is, therefore, right in holding that the income derived by the assessee from making the building available to others for a limited period fur various purposes is only business income. Thus, it is clear that whenever the building remains under the control of an owner, the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the order of assessment that no charges are shown as received for letting out of the ground floor and the first floor. The order is silent about the manner of use of the ground floor and the first floor. Admittedly, the property is a commercial property. The purpose for which the ground floor and the first floor of the property was used during the year under consideration is not in record. If the ground floor and the first floor remained vacant throughout the year, then its proportionate annual rateable value is to be assessed under the head "Income from house property" and if the ground floor and first floor is used in the own business of the assessee, then no income from it can be brought to tax separately. In the circumstances, we set aside the order of the both the lower authorities and remand the matter back to the file of the Assessing Officer for deciding the issue afresh in accordance with the discussion made hereinabove and after allowing an opportunity of being heard to the assessee. The Revenue succeeds on this ground of appeal. 8. The 2nd ground of appeal relates to interest an d other relevant expenses claimed as deduction by the assessee. This ground is conseque ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has rejected the claim of the assessee that the property was used for the purposes of business, without any basis. The Assessing Officer has failed to make an enquiry through her counterpart in New Delhi as has been done in another case of the assessee to verify and ascertain the claim of the business activities of the assessee. In view of this, he deleted the notional income from house property calculated by the Assessing Officer at Rs. 69,000 and directed the Assessing Officer to allow deduction for interest of Rs. 61,646 from out of the business income of the assessee. Being aggrieved the Department is in appeal before us. 12. After hearing the rival submissions in the light of the material available before us, we find that the house property under consideration is a commercial property. The submission of the assessee before the Assessing Officer regarding the prevailing bad law and order situation at the material time at Gauhati was not disputed by the Assessing Officer. The Assessing Officer, rejected the explanation of the assessee merely because no other expenses in respect of Delhi office was claimed by the assessee out of his business income. The explanation of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
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