TMI Blog2017 (2) TMI 556X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee firm was right in showing its both incomes under the head income from business. Therefore, we find no merit in the argument of learned Standing Counsel that the rental income should be shown under a different head. We also do not find any merit in the other argument that since the Tribunal has held in the previous instances that the income received by the same assessee was the income from house property and not a business income, in the instant case also it should have held similarly for the reason that in the earlier instances, the Tribunal had no occasion to peruse the judgment in M/s.Chennai Properties & Investments Ltd., Chennais case (2015 (5) TMI 46 - SUPREME COURT). - I.T.T.A No. 667 of 2016 - - - Dated:- 30-1-2017 - Sanjay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der which the rentals were to be brought to tax was Income from house property but not Income from Profits and Gains of business or profession and accordingly, issued show cause notice to the assessee as to why the income shown by him should not be treated as Income from house property. The assessee responded submitting its explanation to the effect that the main object of the firm was to carry on business in letting out the properties constructed either on acquired or leased lands for a considerable rent and in addition to it, the firm was also carrying on the business in tobacco and the intention of the assessee firm was to let out the property only to earn considerable amount of rent much like an ordinary prudent businessman and the prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the date on which it was existed as to carryout the business activity such as to construct the godowns or residential or commercial buildings or commercial shops etc, on the lands either owned by the firm or by taking land on long lease from others which was the activity of the assessee and in that view, the judgment of the Supreme Court in M/s.Chennai Properties Investments Ltd., Chennais case (supra) would squarely apply to the facts of the instant case and therefore, the income earned by the assessee was Income from business and not Income from house property. Hence, the instant appeal. 3) The appellant, in the grounds of appeal has, in terms of Section 260-A(2)(c) of the I.T.Act mentioned the following substantial questions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chennais case (supra) has no application to the present case for the reason that the main objective of assessee firm was to conduct tobacco business and hence it was liable to show the rents derived from various complexes as income from house property but not as income from business. She thus prayed to admit the appeal and allow the same. 6) We have perused the impugned order and also the partnership deed dated 21.01.2000 of the assessee firm, a copy of which was filed by the appellant as part of the material papers. The partnership deed would show that three partners constituted a partnership firm namely Sri Bharathi Warehousing Corporation by virtue of partnership deed dated 21.01.2000. In it, they got it mentioned that the partnership ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... artnership firm. Thus the optional business proposed was not as clear and emphatic as that of the main business. b) Be that as it may, admittedly during the assessment period under scrutiny, the assessee firm earned income in tobacco business as well as by rents. Hence the point was whether the assessee firm under law, was entitled to show both the incomes under the head income from business or under two different heads i.e, income from business and profession and income from house property. c) In M/s.Chennai Properties Investments Ltd., Chennais case (supra), the brief facts were that the appellant-assessee was a Company and its main objective as stated in its Memorandum of Association was to acquire the properties in City of Madra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property as an owner. In simple, construction of different types of buildings and leasing them out was the main business activity of the firm and doing other activity was only an optional one. In that view, the assessee firm was right in showing its both incomes under the head income from business. Therefore, we find no merit in the argument of learned Standing Counsel that the rental income should be shown under a different head. We also do not find any merit in the other argument that since the Tribunal has held in the previous instances that the income received by the same assessee was the income from house property and not a business income, in the instant case also it should have held similarly, for the reason that in the earlier insta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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