Lease income from industrial lands was treated as State Government income, following the Tribunal's prior binding view.

Lease premium, rent and interest from industrial lands and related funds were held not assessable in the hands of the assessee corporation, because the statutory scheme under the Maharashtra Industrial Development Corporation Act did not create conclusive vesting of ownership for income-tax purposes and an earlier Tribunal decision in the same assessee's case had already treated the income as belonging to the State Government. As that prior view had not been reversed by the jurisdictional High Court, the Tribunal applied it for the year in question. The Revenue's challenge failed and the lower appellate orders were affirmed.

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Issues: Whether lease premium, rent and interest income arising from industrial lands and related funds were assessable in the hands of the assessee corporation or belonged to the State Government.

Analysis: The appeals were covered by the Tribunal's earlier decision in the assessee's own case for a prior assessment year, which had examined the scheme of the Maharashtra Industrial Development Corporation Act, 1961. The scheme showed that the corporation was empowered to acquire, hold, manage and dispose of property for industrial development, but the land acquisition and transfer machinery under the Act did not establish any conclusive vesting of ownership in the corporation for income-tax purposes. As the earlier order had already held that the income from lease premium, rent and interest did not belong to the assessee corporation, and that decision had not been reversed by the jurisdictional High Court, the same view was applied for the year under appeal.

Conclusion: The income in question was not assessable as the assessee corporation's income and the Revenue's challenge failed.

Final Conclusion: The orders of the lower appellate authority were affirmed and the Revenue's appeals were dismissed.

Ratio Decidendi: Where the governing statutory scheme and binding prior decision show that income is earned on behalf of the State Government and the earlier view has not been overturned, the same income cannot be assessed in the hands of the corporation.

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