Commissioner Of Income Tax vs M/S. Concrete Developers Ltd on 1 April, 2010

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Calcutta High Court

Commissioner Of Income Tax vs M/S. Concrete Developers Ltd on 1 April, 2010

Bench: Kalyan Jyoti Sengupta

                             ITA No. 52 OF 2009

                    IN THE HIGH COURT AT CALCUTTA
                   SPECIAL JURISDICTION (INCOME TAX)
                             ORIGINAL SIDE

       COMMISSIONER OF INCOME TAX, KOLKATA-IV, KOLKATA

                                    Versus

                    M/S. CONCRETE DEVELOPERS LTD.



  BEFORE:

  The Hon'ble JUSTICE KALYAN JYOTI SENGUPTA

  The Hon'ble JUSTICE KALIDAS MUKHERJEE

  Date : 1st April, 2010.



              The Court :-Having heard Mr. P.Dudhoria, Learned Counsel
for the appellant and having gone through the impugned judgment and
order it appears that this appeal is sought to be admitted on the following
grounds ;-
             (i)   Whether on the facts and in the circumstances of the case
                   the Learned Income Tax Appellate Tribunal erred in law in
                   upholding the order of Commissioner of Income Tax
                   (Appeal) and thereby allowing deducting under Section 24
                   of the Income Tax Act, 1961 and in holding that the rental
                   income from undisposed flats (being stock in trade) as
                   income under the head Income from house property
                   without considering the fact that the unsold flats from
                                        2

                   where   rent   received   was   stock   in   trade   of   the
                   respondent/assessee and it       was only a temporary

exploitation of business Asset. The income was, therefore, to be treated as business income only ?

(ii) Whether the impugned order is perverse and the same is nothing but the result of total non application of mind of the concerned respondent?

(iii) Whether the impugned order is otherwise bad in law and/or not sustainable in the eye of law?

We have gone through the impugned judgment and order of the Learned Tribunal. The broad question which is formulated is whether in this case the income from house property which was let out to the tenant should be treated as income from house property or business income or other income or not. The Learned Tribunal while appreciating the fact and applying the decision of the Hon'ble Madras High Court in the case of C.I.T.-vs.-Chennai Properties & Investment Ltd. reported in 266 ITR 685 as well as that of the Tribunal of the Gauhati Bench of ITAT in the case of ACIT-vs.-Eastern Industrial Enterprises Limited reported in 80 ITD 355 has come to the conclusion that the income from the flats let out by the assessee is the income from house property.

It is recorded on fact that the flats were let out by the assessee for a period of three years with an option for renewal for two similar terms.

On fact it is found that this was let out for exploiting the property for income but such an income is always attached to house property and this income is placed under the terms of the lease. There is no scope for deciding otherwise than what has been observed by the Learned Tribunal.

Under such circumstances, we do not find any point of law not to speak of substantial point of law.

We, however, decline to admit the appeal and hence the same is dismissed.

All parties are to act on a xerox signed copy of this order on the usual undertakings.

(KALYAN JYOTI SENGUPTA, J.) (KALIDAS MUKHERJEE, J.) GH.

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