TMI Blog2000 (7) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... ome therefrom would constitute an activity of business carried on by the assessee-firm ? (2) Whether, on the facts and circumstances of the case, the Appellate Tribunal is right in holding that the assessee is entitled to renewal of registration ?" The facts of these cases are as follows : The assessee in these cases is George Oommen and Co., Kottayam. For the assessment year 1989-90, the assessee filed an application for registration in Form No. 11 on March 30, 1989, along with a copy of the partnership deed dated January 15, 1982. The assessing authority found that the income earned during the year is income from house property and interest received from Asian Investments. The assessing authority refused to grant registration for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness. The absence of construction activity in the assessment years under appeal does not mean that the partnership firm was not genuine". Then, it went on to consider the decisions on this aspect. Thereafter, it is held as follows : "Apart from this, we are not inclined to agree with the learned Departmental Representative that the activity of financing and earning interest income therefrom and the activity of letting out the premises and earning rental income therefrom would not constitute the activity of business carried on by the assessee. These activities very well amount to business activities and they have been carried on by the assessee in the relevant assessment years in question. Considering all these facts and the case law rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation at Any point of time earlier. However, the second question referred to is as to whether the Appellate Tribunal is right in holding that the assessee is entitled to renewal of registration. Hence, we have to take it that the question for the first year, i.e., 1989-90, is regarding the grant of registration and in the subsequent years regarding renewal of registration. It is true that for the purpose of registration of the firm, under the Income-tax Act, whit is. to be looked Into is whether the partnership has come into force as per the Indian Partnership Act. Whatever may be the head of assessment under the Income-tax Act, so long as what was carried on by the firm could be classified as business in the sense of the Partnership Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n this case to show that any activity was carried on by the assessee. In the decision reported in CIT v. Veerabhadra Industries [1999] 240 ITR 5, the Andhra Pradesh High Court held that a single act of constructing a godown and letting it out cannot be treated as a business. The expression "business" contemplates continuous activity from year to year. There was no evidence that the assessee was continuing the activity of constructing godowns and letting them out from year to year. The decision in CIT v. Lakshmi Co. [1982] 133 ITR 904 (Mad) is distinguishable. In that case, the assessee put up additional constructions and let it out to various tenants. In view of the above facts, we answer the first question in the negative and against th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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