Harsh shah (Final CA Student) (50 Points)
01 July 2012There are 3 persons holding property in their individual names.
They form a partnership firm and introduce these properties into the firm without transferring the ownership.
These properties are being let out and rental income is earned by the firm.
Now this rental income should be charged as Income from House Property or Business Income and WHY in the hands of FIRM?
OWNERSHIP IS NOT TRANSFERRED.
Kindly provide relevant case laws, if any!!
Devendra
(Chartered Accountant)
(4775 Points)
Replied 01 July 2012
It should be taxable under the head Income from House Property.
Harsh shah
(Final CA Student)
(50 Points)
Replied 01 July 2012
But 1 of the basic condition to charge income under Income from House Property is that the Assessee should be the owner of the property.
And in this case the Assessee i.e. the Firm is not the owner.
Deepak Goel
(Partner)
(54 Points)
Replied 02 July 2012
Dear Harsh,
What do you mean when you say "introduce these properties in firm"????
As at the end of FY, where are these properties appearing the BS of firm??
Best Rgds
Deepak Goel
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