The Commissioner Of Income Tax-10 v. M/S.treva Health Care Pvt.ltd

ttm IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO.3029 OF 2009 The Commissioner of Income Tax-10 .. Appellant Vs.M/s.Treva Health Care Pvt.Ltd. .. Respondent. Mr.Suresh Kumar for the appellant CORAM: J.P. DEVADHAR & K.K. TATED, JJ.DATE: 27[th] SEPTEMBER, 2011. P.C. 1. Two questions of law raised by the Revenue in this appeal read thus: “(i) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the income from lease rental earned by the Assessee by letting out machinery was assessable under the head “income from Business” and not “income from other sources” u/s 56 of the I.T. Act, 1961? (ii) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in allowing the depreciation claim of Rs.3,85,390/- of the Assessee u/s.32 of the I.T.Act, 1961?” 2. The Assessment Year involved herein is A.Y. 2001-2002. 2 ITXAL3029-09.doc 3.It is not in dispute that in all the earlier years from A.Y. 1996-1997 to 2000-2001 the income from the lease rental earned by the Assessee by letting out machinery has been assessed under the head “income from Business”. In the assessment year in question, the only reason for assessing the lease rental income under the head ‘income from other sources’ is on the ground that the lease period had expired in the A.Y. in question. 2000-2001 the income from the lease rental earned by the Assessee by letting out machinery has been assessed under the head “income from Business”. In the assessment year in question, the only reason for assessing the lease rental income under the head ‘income from other sources’ is on the ground that the lease period had expired in the A.Y. in question. 4. The Tribunal has recorded a finding of fact that merely because the lease period has expired, the character of the rental income does not change from ‘business income’ to ‘income from other sources’. In our opinion, no fault can be found with the decision of the ITAT in holding that the lease rental income earned by the assessee is to be assessed as “income from business”. lease period has expired, the character of the rental income does not change from ‘business income’ to ‘income from other sources’. In our opinion, no fault can be found with the decision of the ITAT in holding that the lease rental income earned by the assessee is to be assessed as “income from business”. 5.In view of our decision to the first question the second question becomes academic, hence not entertained. becomes academic, hence not entertained. 6. Appeal is accordingly, dismissed. (J.P. DEVADHAR, J.) (K.K. TATED, J.)