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TMI Blog1988 (9) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... er section 256(1) of the Income-tax Act, 1961. The questions read as under : "(1) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the income derived from lease rent of the building with plant, machinery, furniture and fixtures relating to the Anjali Cinema at Shillong is assessable as income from business and not as income from other sources ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the instance of the Revenue, the above two questions are referred to this court. The assessee was carrying on business in exhibiting motion pictures. The firm runs theatres "Kelvin" at. Guwahati, and "Biju" at Shillong. Regarding "Anjali", the assessee invested Rs. 9,26,296 for construction of a building at Shillong which is involved in the present reference. The particulars are : building Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... et out Anjali Cinema thereby to H. O. Unger as he possessed a licence for running a cinema. The moment the firm got the licence, it was agreed that the firm is to terminate the lease and run this business. The Tribunal held that the rental income from the Anjali Cinema would be business income because the assessee constructed the building, equipped it with plant and machinery, furniture and fixtu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [1969] 74 ITR 7 (SC) where the intention of the assessee was to part with the entire machinery of the factory for the obvious purpose of earning rental income and not to treat the factory and the machinery as a commercial asset during the subsistence of the lease. These two cases show the tests. We see that the intention of the assessee was not to let out the building. The intention was to run t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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