About Rent income

If letting out building and machinery are not separable (i.e. one dependent on the other), then entire income is treated as PGBP or IFOS, as applicable. But if letting out building and machinery are separable (that one is not dependent on the other), then rental income from building is treated as income from house property and that from machinery under PGBP/IFOS as applicable.

If in the rent agreement, you have separately mentioned the rent of building and  Machinery, the it is advisable to take Building rent in HP head and claim standard deduction of 30% and Take machine rent in income from other source and claim (depreciation/ wear and tear) of machine against the rent of machine.

However, if you do not have any separate rent in agreement, it is advisable to go by the majority value or purpose.

If it is single activity means not a regular one and inseparable then it is chargeable under IFOS the related clause of section 56 is given below.

56(2)(iii)     where an assessee lets on hire machinery, plant or furniture belonging to him and also buildings, and the letting of the buildings is inseparable from the letting of the said machinery, plant or furniture, the income from such letting, if it is not chargeable to income-tax under the head "Profits and gains of business or profession";