Deemed ownership under Chapter XXC applies only to transfer-like transactions, not mere lease and sub-letting arrangements.

Chapter XXC deeming ownership applies only where the assessee's rights arise from a transaction falling within the statutory definition of transfer under section 269UA(f), not from a mere lease and sub-letting arrangement. A lease taken for sub-letting, even for a long term, does not by itself make the lessee a deemed owner under section 27(iiib). The Board circular was read as confined to transfer-like situations where the occupier effectively has all rights except legal title, such as section 53A-type arrangements. On that basis, lease rent from sub-letting could not be assessed as income from house property on the footing of deemed ownership.

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Issues: Whether lease rent received from sub-letting leased property was assessable as income from business or as income from house property, and whether the deeming provisions relating to ownership under Chapter XXC could be applied to treat the assessee as owner.

Analysis: The assessment was based on the assumption that the assessee became a deemed owner merely because the property had been taken on lease and sub-let for a period exceeding twelve years. The relevant provisions of Chapter XXC were held to operate in the limited context of transactions for transfer of immovable property intended to counter tax evasion, and the extended meaning of transfer under section 269UA(f) applied only to the transactions covered by that Chapter. The deeming ownership provision in section 27(iiib) was therefore held to depend on a transaction falling within section 269UA(f), not on a mere lease arrangement for carrying on the business of sub-letting. The Board circular relied on was also read as confined to cases where the occupier effectively had all rights in the property except legal title, such as transactions under section 53A of the Transfer of Property Act, 1882, and similar transfer-like situations.

Conclusion: The assessee was not a deemed owner under the applicable provisions, and the lease rent from sub-letting could not be assessed as income from house property on that basis.

Ratio Decidendi: The deeming fiction of ownership for income from house property applies only where the assessee acquires rights through a transaction that falls within the statutory definition of transfer under Chapter XXC, and not to a mere lease and sub-letting arrangement unconnected with such a transfer.

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