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TMI Blog2015 (7) TMI 1131X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing Officer ("AO") that the Assessee's income (Loss), is to be computed under the head "Profits and Gains of Business and Profession. 2. On the facts and circumstances of the case and in law, the Assessee submits that the income (Loss) is to be computed under the head Income from House Property". 3. The Department has taken the following sole ground of appeal:- "On the facts and in the circumstances of the case and in law, the ld. CIT(A) erred in allowing carry forward of losses u/s 71B of the I.T. Act without appreciating the fact that the ld. CIT(A) himself has confirmed the expenses as "Pre-operative expenses" and such expenses can be claimed u/s 35D of the I.T. Act only." 4. The assessee company was formed with the object of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld. CIT(A), despite holding the income to be business income, held that the A.O. ought to have allowed carry forward of loss under the head "income from house property". He directed the A.O. to allow the carry forward loss to be capitalized and to be allowed as per the provisions of section 71B of the Act. This has grievanced the Department, which has filed its separate appeal before us. 8. Apropos the issue as to whether the assessee's income is to be computed as 'income from house property' as claimed by the assessee, or under the head 'profits and gains of business or profession', as held by the ld. CIT(A), Section 22 of the Act provides that the annual value of the property consisting of any building or land appurtenant thereto, of wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. CIT(A) at page 4, para (d) of the impugned order. 9. For the above discussion, the grievance of the assessee is found to be justified and is accepted as such. The order of the ld. CIT(A) in this regard is cancelled and it is held that the income of the assessee is to be computed as 'income from house property'. The assessee's claim in this regard is, thus, allowed. 10. Coming to the Department's grievance, once we have held that the income is to be assessed as 'income from house property' as above, on this very basis, the order of the ld. CIT(A) on this issue is upheld, rejecting the grievance of the Department as shorn of merit. 11. In the result, appeal of the assessee is allowed and that of the appeal filed by the Department is dis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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