2003 (1) TMI 52

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... eferred by the Department under section 260A of the Income-tax Act, 1961 (in short "the Act"). The substantial question of law arising out of the Tribunal's order is-whether the income derived by the assessee from letting out of the house property should be assessed under the head "Income from house property" under section 22 or "Income from business" under section 28 of the Act. The relevant facts lie in a narrow compass. The assessee is a private limited company. One of the directors of the company, Sri B.R. Kapanipathy, had taken certain extent of lands situate at Bangalore on a long-term lease of 36 years under a registered lease-deed dated December 20, 1972. He executed a registered deed of transfer in favour of the assessee-company t .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... ording to the Tribunal, since the land over which the property had been built is a leasehold land, the assessee cannot be treated as the owner of the land which is a condition precedent for treating the income as income from house property under section 22 of the Act. Taking into account the identical facts as obtained in the case and on review of earlier judgments on the point, a three-judge Bench of the Supreme Court in the case of CIT v. Podar Cement (P.) Ltd. [1997] 226 ITR 625 has held that: "We are conscious of the settled position that under the common law, 'owner' means a person who has got valid title legally conveyed to him after complying with the requirements of law such as the Transfer of Property Act, Registration Act, etc. .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... der specific heads has to be computed for the purpose of taxation in the manner provided by the appropriate section. If the income from a source falls within a specific head set out in section 6, the fact that it may indirectly be covered by another head will not make the income taxable under the latter head. The income derived by the company from shops and stalls is income received from property and falls under the specific head described in section 9. The character of that income is not altered because it is received by a company formed with the object of developing and setting up markets." Learned counsel for the assessee has placed reliance on the judgment of the Supreme Court in the case of S.G. Mercantile Corporation (P.) Ltd. v. CI .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X