Bhabi Properties Pvt. Ltd. v. The Income-tax Officer, Ward-3 - 2014-LL-0924-78

Citation	2014-LL-0924-78
Appellant Name	Bhabi Properties Pvt. Ltd.
Respondent Name	The Income-tax Officer, Ward-3
Court	HIGH COURT OF CALCUTTA
Relevant Act	Income-tax
Date of Order	24/09/2014
Judgment	View Judgment
Keyword Tags	house property
Bot Summary:	Whether income of a company whose main business is inter alia to acquire properties on lease and let them out for profit should fall under the heading Income fkrom House property or should fall under the heading income from profits and gain of business 3. Whether the section 27(iii) of the Income-Tax Act, 1951 relates back to past transactions particularly when Section 27 of the Income-Tax Act, 1961 refers to transaction as contained in Section 269UA of the Income-Tax Act, 1961 which itself has come into force with effect from 1st April, 1986 4. Whether even assuming that your petitioner is a deemed owner of the leasehold premises the rental income of the petitioner should be assessed under the head, Income from Profits and Gains of Business particularly as the main business of the petitioners is to acquire properties on lease and let them out for profit Heard Mr.J.P.Khaitan, learned Senior Advocate for the appellant and Mr.Nizamuddin, learned advocate for the respondent. 3 We find that the questions are covered by the judgement in the assessee s own case in Bhabi Properties Ltd. v. Assistant Commissioner of Income-tax, Company Circle 9(1), Calcutta : 201 Taxman 59. The question nos.1 and 3 stand decided by the aforesaid judgement as held particularly in paragraph 22 thereof. We answer the question no.1 in negative and question no.3 in affirmative, both in favour of the revenue and against the assessee. So far as question nos.2 and 4 are concerned, we answer them in line with the findings as held in paragraph-27 of the said judgement by restoring the matter to the file of the assessing officer in relation to those questions.

ORDER SHEET ITA 100 OF 2006 IN HIGH COURT AT CALCUTTA Special Jurisdiction (Income Tax) ORIGINAL SIDE BHABI PROPERTIES PVT. LTD. Versus INCOME TAX OFFICER WARD-3 BEFORE: Hon'ble JUSTICE SOUMITRA PAL Hon'ble JUSTICE ARINDAM SINHA Date : 24th September, 2014. For appellant : Mr.J.P.Khaitan,Senior Advocate For respondent : Md.Nizamuddin, Advocate. Court : appeal was admitted on following questions : 1. Whether use of word acquires appearing in Section 27(iii)(b) of Income-Tax Act, 1961 which was introduced with effect from 1st April, 1988 relates to prospective transactions, or to be more specific, rights which have been acquired on or after relevant date of insertion of provision that is 1st April, 1988 ? 2 2. Whether income of company whose main business is inter alia to acquire properties on lease and let them out for profit should fall under heading Income fkrom House property or should fall under heading income from profits and gain of business ? 3. Whether section 27(iii) (b) of Income-Tax Act, 1951 relates back to past transactions particularly when Section 27 (iii) (b) of Income-Tax Act, 1961 refers to transaction as contained in Section 269UA (f) of Income-Tax Act, 1961 which itself has come into force with effect from 1st April, 1986 ? 4. Whether even assuming that your petitioner is deemed owner of leasehold premises rental income of petitioner should be assessed under head, Income from Profits and Gains of Business particularly as main business of petitioners is to acquire properties on lease and let them out for profit ? Heard Mr.J.P.Khaitan, learned Senior Advocate for appellant and Mr.Nizamuddin, learned advocate for respondent. 3 We find that questions are covered by judgement in assessee s own case in Bhabi Properties (P) Ltd. v. Assistant Commissioner of Income-tax, Company Circle 9(1), Calcutta : 201 Taxman 59 (Cal). question nos.1 and 3 stand decided by aforesaid judgement as held particularly in paragraph 22 thereof. Hence, we answer question no.1 in negative and question no.3 in affirmative, both in favour of revenue and against assessee. So far as question nos.2 and 4 are concerned, we answer them in line with findings as held in paragraph-27 of said judgement by restoring matter to file of assessing officer in relation to those questions. (SOUMITRA PAL, J.) (ARINDAM SINHA, J.) ssaha AR(CR) Bhabi Properties Pvt. Ltd. v. Income-tax Officer, Ward-3

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