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Appeal of revenue regarding direction to assess property income in status of registered firm. Analysis: The case involves appeals by the revenue concerning the assessment years 1984-85 to 1991-92, focusing on the direction of the CIT(A) to assess property income in the status of a registered firm. The assessee firm, as per the Partnership Deed, engaged in activities related to immovable properties, particularly developing property at a specific location. The lease deed involved demolishing an existing building and constructing a new one for leasing purposes. The CIT(A) determined the activity as a business under the Indian Partnership Act, directing the Assessing Officer to treat the firm as a registered firm. In the assessment years under consideration, the first appellate authority concluded that the rental income received by the assessee falls under the head 'house property,' following relevant judicial precedents. The CIT(A) emphasized that the activity of the assessee constitutes a business within the broad meaning of the term as understood commercially. The revenue contended that since there was no business activity beyond rental income, the firm cannot be considered a registered firm. However, the assessee argued that previous Tribunal decisions in their case supported the CIT(A)'s orders. The Tribunal analyzed the definitions of 'business' under the Indian Partnership Act and the Income-tax Act, emphasizing that even a single profit-oriented activity constitutes a business. The Tribunal delved into the requirements for a valid Partnership Firm under the Indian Partnership Act, highlighting the necessity of an agreement to share profits from a business. Referring to relevant case laws, the Tribunal affirmed that income from property should be taxed under the head 'Income from property,' even if the firm's only income source is property-related. The Tribunal stressed that the classification of income heads under the Income-tax Act does not negate the business nature of a firm under the Partnership Act. Ultimately, the Tribunal concluded that the firm's activities, as outlined in the Partnership Deed, constituted a business, despite the income being taxable under 'house property.' Citing previous Tribunal decisions and lack of new evidence, the Tribunal upheld the status of the firm as a registered firm, dismissing all appeals by the revenue.
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