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September 2024

Section 22 vis-à-vis 28 — Income from house property” or “business income” — Rule of consistency — Applicable to tax proceeding

By Ajay R. Singh, Advocate
Reading Time 9 mins

Pr. CIT - 3 Mumbai vs. Banzai Estates P. Ltd.

ITXA No. 1703, 1727 & 1900 of 2018

A.Ys.: 2008–09, 2009–10 and 2010–11.

Dated: 9th July, 2024, (Bom) (HC).

13. Section 22 vis-à-vis 28 — Income from house property” or “business income” — Rule of consistency — Applicable to tax proceeding.

The issue before the Tribunal was as to whether the income received by the Respondent-Assessee from the property owned by it be accepted as “income from house property” or as contended by the Revenue, it should be treated as “business income”.

The Assessee is engaged in the business of hiring and leasing of properties. The Assessee declared an income from a self-owned property situated at MBC Tower, TTK Road, Chennai (for short, “MBC Tower property”) as income from house property. Apart from such income, the Assessee also declared rental income received from sub-letting of four other properties not owned by the Assessee, as income from business. The Assessing Officer did not accept the income earned from the MBC Tower property as “income from house property” and held such income necessarily to be a “business income”.

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