Head of income

This query is : Resolved

AMIT RATHI (Querist)
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19 June 2013 MY CLIENT HAS CLOSED HIS MFG. ACTIVITY AND PRODUCTION. NOW THE FACTORY BUILDING HAS BEEN LETOUT AND HE DERIVES INCOME FROM RENT. PLEASE LET ME KNOW WHETHER RENTED INCOME CAN BE DISCLOSED UNDER THE HEAD INCOME FROM BUSINESS AND WHETHER EXPENSES INCURRED FOR MAINTANENCE, ADMINISTRATION AND OFFICE CAN BE CLAIMED AS DEDUCTION.
PLEASE REPLY WITH CASE LAWS.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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19 June 2013 PLEASE MENTION CLEARLY WHETHER THE PLANT & MACHINERY HAS BEEN SOLD AWAY?
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IN CASE OF LETTING OUT OF FACTORY BUILDING ONLY , RENTAL INCOME IS CONSIDERED UNDER THE HEAD INCOME FROM HOUSE PROPERTY. IN THAT CASE IT CAN NOT BE SHOWN UNDER THE HEAD PGBP.
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Guest

Guest (Expert)

19 June 2013 Please clarify, is the business is shut down permanently, if yes, than in that case the same income can be assessed under other sources also

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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20 June 2013 If the factory building alone is let out, income should be offered for income tax assessment under the head 'income from house property'.

In case letting is 'composite' and rent for building and plant, furniture etc can't be separately know from the rent agreement, entire income should be offered under 'income from other sources' as rightly pointed out by Ashish Ji.