AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2014 (11) TMI 895
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....8- 89, 1989-90, 1990-91, 1991-92 & 1992-93 respectively, the revenue has preferred the present Tax Appeals for consideration of the following substantial question of law which were framed while admitting the matters: "Whether, on the facts and circumstances, the Tribunal was justified in holding that the rental income from letting out of warehouses/godowns together with various services rendered to the occupant did not constitute a business activity of the appellant and as such the income arising therefrom was not assessable under sec. 28 of the Income-tax Act, 1961 as business income? Whether, on the facts and circumstances of the case, the Tribunal could have arrive....
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.... partnership deed and submitted that the rent received from the warehouse in the case of the assessee is incidental to the business. He submitted that such income can be assessable only under the head 'business income' and not as 'income from house property'. 4.1 Mr. Divetia has relied upon the decision of this Court in the case of Commissioner of Income-tax vs. Surat Textile Market Co-operative Shops and Warehouse Society Ltd reported in [2003] 264 ITR 289 wherein it is held that nominal rent for godown and shops constitutes income from other sources and that the income derived by the assessee by permitting use of auditorium by collecting charges would fall under the head 'business income'. It is held that the income which was derived by ....
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....did not accept the contention and treated the income, derived from the house property. The Tribunal ultimately held in favour of the assessee and came to conclusion that, , ..the director of M/s. Saptarashi Services (P) Limited are not related to the directors of M/s. Kohinoor Tabacco Products (P) Limited. The electricity charges from October 1, 1989 to March 31, 1990, were paid to M/s. Mohanlal Hargovandas who were one of the members of the service centre and M/s. Saptarshi Services (P) Limited reimbursed them later. The assessee is having EPABX machine which facilitates providing telephone services to the occupants of the service centre. Besides this, the assessee is providing various services to the occupants like services of lift, servi....
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....ther facilities and providing tarred roads are incidental to the main activity of letting out of godowns for storage of fertilizers. 5.1 Mr. Bhatt submitted that it can be seen from the assessment order as well as the letter from Indian Potash Ltd that their requirement was semi plinth which means there were no constructed godowns and that there cannot be godowns without walls, doors and roofs. He submitted that therefore whatever the assessee earned from Indian Potash Limited cannot by any strength of imagination be said to be godown rent claimed to be assessable as business income. 6. We have carefully considered the submissions made by learned advocates for both the sides. The ground in these appeals relates to the head of income as to....
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.... being assessable under the head "income from house property". The provision for security, adequate space for canteen, light and water arrangements telephone and other facilities and providing tarred roads are incidental to the main activity of letting out of godowns for storage of fertilizers. M/s. IPL making payment for use of godowns for storage of fertilizers and such rental income squarely falls within the ambit and scope of "income from house property" chargeable to tax u/s 22 to 27 of the Act." 7.1 We are in complete agreement with the reasonings adopted and findings arrived at by the Tribunal. It is a settled law that whether any income falls under one head or the other has to be decided according to the common notions of practical....