COMMISSIONER OF INCOME TAX Vs. MAYAR INDIA LTD.

JUDGEMENT

(1.) Vide order dated 18th January, 2011, the following substantial question of law was framed :-

(2.) As we have heard the learned counsel for the parties, we proceed to pronounce our decision. Learned counsel for the Revenue has pointed out that similar additions were made in the following assessment years by treating the rental income as "income from the house property" and not income taxable under the head "income from business". However, the said findings were reversed by the CIT (Appeals) and affirmed by the ITAT. Revenue, it is stated, did not prefer any appeal against the order of the ITAT for the reason that the assessment had been completed under the MAT provisions i.e. under Section 115JB and the tax was on the lower side than the prescribed limit. The statement made by the learned senior standing counsel is taken on record.

(3.) The respondent-assessee is a company and for the assessment year 2002-03 it had filed its return of income dated 30th October, 2002 declaring total income of Rs. 1,53,11,558/-. The Assessing Officer, as noticed above, held that the rental income received from the property was taxable under the head "income from house property" and not under the head "income from business". The reasons given by the Assessing Officer read as under:-