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Issues: Whether, on the terms of the agreement to sell and the subsequent construction arrangement, the assessee was chargeable to income from the entire building or only in respect of the flats and cottage specifically allotted to him.
Analysis: The agreement showed that what was sold was the land, while the building was to be constructed by the purchaser through the builder. Applying the principle recognised in the cited authority, the taxability under section 9 depended on who could be regarded as the owner of the relevant property. The revenue had not established that the assessee remained the owner of the superstructure as a whole. The earlier Bombay decisions relied on by the revenue were distinguishable because, on the facts there, the competing ownership structure was not the same. On the facts here, the assessee retained ownership only to the extent of the specific flats and cottage reserved for him, while the remaining flats were attributable to their respective purchasers.
Conclusion: The assessee was liable to be assessed only on the income referable to the two flats and the cottage allotted to him, and not on the income from the remaining flats.
Ratio Decidendi: Where an agreement for sale and construction leaves the land with one party but allocates the superstructure to the purchaser and individual flat buyers, income from house property can be taxed only in respect of the portion in which the assessee is the owner, and the revenue must prove ownership of the balance property.
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