CA Final DT Case Laws May 17 Series - Income from House Property

Chapter: Income from House Property

#CAPassion #DTCL #M17-012

CIT v. Chennai Properties and Investments Ltd.(2015 – SC)

Issue: would income from letting out of properties by a company, whose main object as per its memorandum of association is to acquire and let out properties, be taxable as its business income or income from house property, considering the fact that the entire income of the company as per its return of income was only from letting out of properties?

Decision: SC held that the assessee had rightly disclosed the income derived from letting out of such properties under the head “Profits and Gains of business & profession”

#CAPassion #DTCL #M17-013

New Delhi Hotels Ltd. v. ACIT (2014 – Del. HC)

Issue: whether rental income derived from the unsold flats which are stock in trade of books of the assessee would be taxable under the head “PGBP” or “House Property” where actual rent receipts formed the basis of computation of income.

Decision: HC held that such income should be assessed under the head House Property not PGBP

#CAPassion #DTCL #M17-014

CIT v. NDR Warehousing P Ltd. (2015 – Mad. HC)

Issue: would income from letting out of godowns and provision of warehousing services be taxable under head PGBP or House property?

Decision: HC held that such income should be assessed under the head PGBP not House Property.

#CAPassion #DTCL #M17-015

CIT v. Hariparsad Bhojnagarwala (2012 – Guj. HC)

Issue: Can benefit of self occupation of house property u/s 23(2) be denied to a HUF on the ground that it, being a fictional entity, cannot occupy a house property?

Decision: HC observed that singular includes plural, the word owner would include owners. This is correct that HUF or firm cannot reside in a house, but HUF comprises of members of family and family comprises of natural persons. Hence HUF cannot be said to be a fictional entity. Held that HUF is entitle to claim such benefit u/s 23((2).

#CAPassion #DTCL #M17-016

CIT v. Asian Hotels Ltd. (2010 – Del. HC)

Issue: Can notional interest on interest free deposit received by an assessee in respect of a shop let out on rent be brought to tax as business income or income from house property?

Decision: HC held that such notional interest is neither assessable as business income nor as income from house property.

Gourav Kapoor
CA Passion


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