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Taxation of kayana mandap

N.N.RAJAN (PROFESSIONAL) (243 Points)

28 August 2011

Dear Members,

Please answer my following query.

Whether Income from Marriage Hall / Kalyana Mandap is is taxable under Property Income or Business Income ?

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13 Replies

CA PRAVEEN SINGH (MANAGER ACCOUNTS) (2277 Points)
Replied 28 August 2011

Business income.

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N.N.RAJAN (PROFESSIONAL) (243 Points)
Replied 29 August 2011

Thanks for your reply. But it is the property which is eaning out of its inherent capacity.Is itn't?

Ravi Chopra (CA) (661 Points)
Replied 30 August 2011

It is used for Assessee's business purpose.. It should not be in house property since Assessee is using the premises and it is not LET OUT!!!

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Dhanabal Ramasamy (CHARTERED ACCOUNTANT) (105 Points)
Replied 30 August 2011

Hai..

It is to be assessed as House property income. Because sec 22 say " any building" which is not confined to house only. It is a commercial building let out for rent which cannot said as business purpose.

Ravi Chopra (CA) (661 Points)
Replied 30 August 2011

Do not read half section. read full section 22.. specially the highlighted portion.

Income from house property.

The annual value of property consisting of any buildings or lands appurtenant thereto of which the assessee is the owner, other than such portions of such property as he may occupy for the purposes of any business or profession carried on by him the profits of which are chargeable to incometax, shall be chargeable to income-tax under the head “Income from house property”.

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N.N.RAJAN (PROFESSIONAL) (243 Points)
Replied 30 August 2011

Well. The assessee is not occupying it for his business since he is not doing any business in it. He only rents it out to others for specified days. So only the property which is earning income. In this light can we conclude that it is assessable uner Property Income?

Ravi Chopra (CA) (661 Points)
Replied 30 August 2011

Kindly refer to this case law

The Director Of Income-Tax vs Paramartha Bhushanam

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CA PRAVEEN SINGH (MANAGER ACCOUNTS) (2277 Points)
Replied 02 September 2011

Agree with Mr Ravi...

CA. Roopali Kadam (Jobs on assignment basis.) (1459 Points)
Replied 02 September 2011

Business Income

Dhanabal Ramasamy (CHARTERED ACCOUNTANT) (105 Points)
Replied 03 September 2011

Originally posted by : Ravi Chopra
	Do not read half section. read full section 22.. specially the highlighted portion. Income from house property. The annual value of property consisting of any buildings or lands appurtenant thereto of which the assessee is the owner, other than such portions of such property as he may occupy for the purposes of any business or profession carried on by him the profits of which are chargeable to incometax, shall be chargeable to income-tax under the head “Income from house property”.

Mr.Ravi

what u have highlited in sec 22 - means that any property is ocuppied by the assessee for his business is need not be computed as house property. In case of kalyana mandapam he never occupies but he just leases it out for earnig income. For an example if i start a company and my business is letting the building for rent then is it a business income? as i m using the building for my business. No. Same is in the kalyana mandapam case.

Please go through the case law completely. it has gone to Apellate Tribunal and assessee was awarded favourable but the thing is the case is with reference to assessing income of trust and related to 11(4A) and no where related to sec 22.

Attached File : 73985 820920 the director of income tax vs paramartha bhushanam on 18 december 2002.pdf downloaded: 218 times