Income from bare letting of tenement is taxable as Income from house property

CWT Vs Atma Ram Properties (P) Ltd. (Delhi High Court)

In the present case, the subject property let out by the assessee-company was undisputedly owned by it and it was a case of bare letting of tenement and the subject hired out was not a complex one. It was thus a case of letting out of a property owned by the assessee simpliciter and not a case of exploitation of the property by way of complex commercial activity. The rental income earned from the said property thus was chargeable to tax under the head “Income from house property” and not under the head “Profits and gains of business or profession” as claimed by the assessee. As such, considering all the facts of the case and keeping in view the legal position emanating from the various judicial pronouncements discussed hereinabove, we hold that the rental income received by the assessee in the year under consideration was assessable to tax under the head “Income from house property” and not under the head “Profits and gains of business”.

FULL TEXT OF THE HIGH COURT JUDGMENT / ORDER IS AS FOLLOWS:-

These are eleven appeals by the Commissioner of Wealth Tax (hereafter ‘Revenue’) under section 27A of the Wealth Tax Act, 1957 (‘WTA’), against the orders of the Income Tax Appellate Tribunal (ITAT) for assessment years (‘AYs’) 1984-85 to 1992-93 and assessment years 1997-98 to 1998-99.

Facts in brief

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