Hire charges treatment
This query is : Resolved
Shruti Mishra
(Querist)
24 November 2011
hello,
my client has group companies engaged in stuffing/destuffing at CFS. out of which a proprietory concern was idle with no operations.it lent its equipments on hire to its group concern and the income accrued is treated as other sources and not business income.
is the treatment correct.??
please recommend some case studys.
my client has group companies engaged in stuffing/destuffing at CFS. out of which a proprietory concern was idle with no operations.it lent its equipments on hire to its group concern and the income accrued is treated as other sources and not business income.
is the treatment correct.??
please recommend some case studys.
CA Satish Badve
(Expert)
24 November 2011
No, It should be treated as business income.
Shruti Mishra
(Querist)
24 November 2011
but sir, letting a machinery on hire is not the core business of the concern...
then y shud it be treated as business income.
then y shud it be treated as business income.
25 November 2011
If the idle situation is permanent , income can be offered under 'income from other sources'. If not, under 'profits and gains of business or profession' though letting out is not the business.
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