Professional income

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

28 July 2012 Dear sir,
My client is a HUF and earning rent income from godowns.In the year 2011-12 they have incurred a loss in the professional income.As a result while computing the income the income chargeable under the head "Buisness and Profession" shows negative of Rs.151540/-
I want to know whether this is acceptable or not.Please reply back immediately as we have to file this return before 31.07.2012

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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28 July 2012 According to section 22,Rental income from letting out of residential and commercial buildings is covered under this head of income. Where property constitutes stock in trade of business or where business of assessee is to let out house property, income is covered under the head profits and gains of Business & Profession. Further if letting out is subservient to the main business the annual value will not be chargeable u/s. 22 rather it will be chargeable under profits and gains of Business & Profession.

So my view, if the HUF`s main business to letting out the property,it can be claimed under Income from Business & Profession" other wise need to show under Income from house property and the HP loss also can be carried forward till 8 years and set of Income from house property