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2014 (10) TMI 978 - ITAT MUMBAITreatment to rental income received by the assessee on letting out the unsold stock - “Income from house property” or “Business income” - allowing of deduction under section 24 - Held that:- On identical set of facts, it has been held consistently by the Tribunal that the rental income received by the assessee has to be assessed under the head “Income from house property”. Therefore, following the orders of the Tribunal in the preceding assessment years on the same issue, we confirm the order of the ld. CIT(A) on this issue and thus the appeal of the Revenue is hereby dismissed accordingly. Income from the sale of the premises in question as sale of the stock in trade - busniss income - assessee submitted that property in question was converted from stock in trade to investment in the year 2005 - Held that:- Mere changing the head in the balance sheet is not sufficient to hold that the intention of the assessee to hold the property was as investment. From the record, we observe that since the assessee could not sell its property at appropriate time and therefore had exploited it for rental purposes. To get the benefit of indexation, the assessee made the accounting entry treating the same as investment, whereas, the real business intention and treatment of the property remained the same i.e. to sell it for the purpose of business of the assessee. The AO has discussed in detail, the nature, character and business of the assessee, the clauses of the partnership deed as well as the terms and conditions of the agreement entered into by the assessee while selling the property in question as promoter of the property. The order of the AO as well as of the ld. CIT(A) is well reasoned and we do not find any infirmity in the same. Lower authorities have rightly treated the income from the sale of the premises in question as sale of the stock in trade and as such the income from the same has rightly been taxed under the head “Business income.”
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