TaxTMI 
TaxTMI 
1969 (2) TMI 55
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....3, the account year being the period from 1st April, 1961, to 31st March, 1962. The assesses is a private limited company and is a distributor of Fiat Cars at Indore. It has to maintain a workshop and showroom for the purposes of its business. The principals of the assessee, the Premier Automobiles Ltd., wanted it to rent a modern showroom and workshop, as the then existing showroom and workshop were not suitable. To meet the demand of the principals the assessee entered into an agreement on 1st April, 1960, with M/s. Goolbanu Godrej and others (an association of persons and hereinafter referred to as the "landlords"), who owned a suitable plot of land for construction of a building to house the showroom and workshop. It was agreed that the....
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....ficer and the Appellate Assistant Commissioner were confirmed. On an application made by the assessee, the Tribunal referred to us the question of law that we have already set out. The facts found are that the association of persons constituting the landlords in the relevant year consisted of members who were all shareholders in the assessee-company ; they were all persons from the same family, the details of which are given in the order of the Appellate Assistant Commissioner, which forms part of the statement of the case. There was, therefore, virtual identity of interest between the landlords and share holders of the assessee. The assessee's workshop was actually shifted to the new building in October, 1962, and the showroom was shift....
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....mises are occupied by the assessee- (i) as a tenant the rent paid for such premises ; and further if he has undertaken to bear the cost of repairs to the premises, the amount paid on account of such repairs ; (ii) otherwise than as a tenant, the amount paid by him on account of current repairs to the premises ; (b) any sums paid on account of land revenue, local rates or municipal taxes ; (c) the amount of any premium paid in respect of insurance against risk of damage or destruction of the premises. " It would be seen that a deduction under section 30 in respect of rent for premises is admissible only if the premises are " used for the purposes of the business ". The only question before us is whether the rent paid in respec....
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..... There is no substance in this contention. Even according to the facts alleged by the assessee (which have not been accepted), the building was not kept ready for use but was being made fit for use of business by installing machinery and furnishing it. It was never ready for use during the accounting year. When a building is being made fit for use, the building cannot be said to be in use either actively or passively. In Liquidators of Pursa Ltd. v Commissioner of Income-tax their Lordships while referring to clauses (v), (vi) and (vii) of section 10(2) of the 1922 Act, said thatthe words " used for the purposes of the business " mean used for the purpose of enabling the owner to " carry on the business and earn profits in the business ", ....