Legal ownership governs house property income tax until registered transfer; possession under sale agreement does not shift tax liability.

Income from immovable property remains chargeable under section 22 in the hands of the legal owner until title passes by a registered conveyance deed. Payment of consideration and delivery of possession under an agreement for sale do not, by themselves, divest ownership for tax purposes. Section 53A protects possession under part performance, but it does not create real ownership or shift the incidence of tax from the transferor. The view followed is that rental income continues to be assessable to the transferor until registered transfer of title is completed.

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Issues: Whether income from an immovable property is assessable under section 22 in the hands of the transferor until title passes by a registered conveyance, notwithstanding payment of consideration and delivery of possession to the transferee.

Analysis: Income from house property is chargeable in the hands of the owner, and for an immovable property ownership refers to legal ownership. Where title has not passed by a registered conveyance deed, the transferor continues to be the legal owner. Delivery of possession and payment of consideration under an agreement for sale do not, by themselves, divest ownership for the purposes of section 22. The doctrine of part performance under section 53A protects possession but does not create real ownership or displace the transferor's title. The later Andhra Pradesh High Court view, which reiterated that rental income remains assessable in the hands of the legal owner until registered transfer, was followed.

Conclusion: The income from the property remained assessable in the hands of the assessee until execution of the registered conveyance, and the assessment made by the Income-tax Officer was upheld.

Ratio Decidendi: For purposes of section 22, the taxable owner of immovable property is the legal owner, and possession under an agreement of sale does not shift tax liability absent a registered transfer of title.

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