Rental income from warehouses taxed as house property income where ownership and letting, not commercial intent, determined the head of income.

Rental income derived from the letting of owned warehouses was held to fall under the head of income from house property because the source of receipt was ownership and letting of the property. The assessee's object of commercially exploiting the warehouses did not change the character of the income, as the heads of income are mutually exclusive and property income cannot be reclassified as business income merely on that basis. Temporary or continuing occupation by a lessee also did not alter the tax character of the receipt. The issue was therefore answered in favour of the Revenue, and the income was taxable as house property income, not business income.

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Issues: Whether rental income from letting warehouses was assessable as business income or as income from house property.

Analysis: The income arose from ownership and letting of warehouses, which constituted the source of receipt. The classification of income under distinct heads depends on the source from which it is derived, and where income falls within the head of property income, it cannot be brought under business income merely because the assessee had an object of letting out warehouses. The reasoning applied the principle that the heads of income are mutually exclusive and that temporary or continuing occupation by a lessee does not alter the character of the income.

Conclusion: The rental income from the warehouses was assessable as income from house property and not as business income, so the question was answered in favour of the Revenue.

Ratio Decidendi: Rental income derived from the letting of owned property is taxable under the specific head applicable to property income, and the assessee's commercial object of letting does not, by itself, convert such receipt into business income.

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