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TMI Blog2014 (9) TMI 501X X X X Extracts X X X X X X X X Extracts X X X X ..... icate that the building had peculiar amenities, which could be commercially exploited such as facilities of sterilization of surgical instruments and bandages or an operation theatre - The Tribunal was rightly of the view that the building which was leased out by the appellant was nothing else but a building simplicitor and was not a building, which was equipped with specialized plant and machinery –assessee is not running the business of a hospital and has only let out the building - the income derived was from the ownership of the building and not from the personal exertion, which is necessary to treat the income as a business income – thus, the income derived by the assessee from the leasing out of its property was an income from house property and not a business income – Decided against assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax holding that the income of the appellant was an income from house property, but the other member dissented holding that such income is a business income. On account of difference of opinion between the two members, the matter was referred to the third member of the Tribunal, who opined that the income of the appellant should be assessed as income from house property. In view of the opinion of the third member, the appeal of the appellant was dismissed holding its income as income from house property. The appellant, being aggrieved, has filed the present appeal under Section 260A of the Income Tax Act, which was admitted on the following substantial questions of law: "(i) Whether, the income of ₹ 3,23,000/- is income from business and profession and not income from house property? (ii) Whether, the learned Tribunal has totally misread and misinterpreted the lease agreement between the appellant and M/s Deva Nursing Home (P) Ltd. to hold that the receipts derived thereunder were taxable at the hands of the appellant as "income from house property" and not "income from business and profession"? (iii) Whether, the finding of the learned Tribunal t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... head cannot be brought to charge under a different head for the simple reason that Rules for computing income and the deductions, which are permissible vary under each of the five different heads. The scheme of the Act is first to classify the income under the different heads and then work out the computation under each of the heads as per the provisions relating to such head and then total up the computation so made for the purpose of arriving at a final figure and the total income liable to tax. For the purpose of charge of income tax and computation of total income under Section 14 of the Act, all income shall be classified such as salaries, income from house property, profit and gains of business and profession, capital gains or income from other sources. Section 14 starts with the words "save as otherwise provided by this Act", which indicates that for the purpose of charge of income tax and computation of total income, all income shall be classified under the five following heads of income specified in Section 14 of the Act unless it is specifically provided otherwise elsewhere by the Act. On the other hand, Section 22 provides that income from house property woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xploitation of business assets." In the light of the aforesaid principles, the learned counsel for the appellant contended that the facts in the instant case has to be gone into for the purpose of holding whether it was a business income or income from property. The learned counsel contended that the appellant's intention was to run a hospital but since it had no experience it made a transient alternate arrangement to let out the building along with the plants and machinery for commercial exploitation of its commercial assets so that the income from such letting could be treated as a business income. This contention is misplaced. We also find that reliance by the appellant on the decision of the Supreme Court in Sultan Brothers' case (supra) is misplaced. The Supreme Court in that case considered a case where the assessee constructed a building and filled it up with furnitures and fixtures and let it out on a lease fully equipped and furnished for the purpose of running a hospital. The lease provided for a monthly rent for the building and a hire charge for the furnitures and fixtures. On these facts, the Supreme Court held that letting out of the said building did no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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