Beneficial ownership test governs house-property income when rent is received despite absence of registered title.

Rental income from a flat was held assessable as income from house property because, for section 22 purposes, ownership is understood in a practical and beneficial sense rather than by strict legal title. The decisive test was whether the assessee was entitled to receive the income in her own right; receipt of rent by the assessee was sufficient, and the absence of a registered sale deed or gift deed did not justify taxing the rent as income from other sources. Property-transfer and registration requirements under the Transfer of Property Act and Registration Act did not alter the income-tax position. As the rent was taxable under the house-property head, the related statutory deductions could not be denied.

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Issues: Whether rental income from the flat was assessable under the head "Income from house property" in the assessee's hands despite absence of a registered conveyance or legal title, and whether the consequential disallowance of statutory deductions could be sustained.

Analysis: The decisive test under section 22 of the Income-tax Act, 1961 is not strict legal title under property law, but whether the assessee is entitled to receive the income in her own right. The Court followed the principle that, for income-tax purposes, ownership is understood in a practical and beneficial sense. Since the rent from the flat was received by the assessee, the absence of a registered sale deed or gift deed did not justify assessment of the rent as income from other sources. The reliance placed on property-transfer requirements under the Transfer of Property Act, 1882, and the Registration Act, 1908, did not alter the income-tax position. Once the rental income was held taxable as house-property income, the related statutory deductions could not be denied on the footing adopted by the revenue authorities.

Conclusion: The rental income was rightly assessable as income from house property in the assessee's hands, and the disallowances made by the revenue authorities were unsustainable.

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