Land taxes

You have to pay taxes under PGBP, while your father can pay tax on rental income u/s. IFOS.

@ Nitesh

Really appreciate your contribution........  towards .......... " Be Helpful To One Another" ....

Yes, your father can get deduction of the property tax payment from the rental income, which you pay him.

I wish to take Dhirajlal Rambhia Sir's point further ahead and wish to add that in respect of income accruing/arising from the lawn is taxable in your hands under the head of "profit and gains from business and profession". But the land is in the ownership of the father. It does not appear that you have any contract with your father regarding the use of his land. If your income would be more than that of your father, you must have a rental/lease agreement with your father. Your rental expenses would be deducted from your business income and rental income would be chargeable to your father.

Since the father is the owner of the property, he should pay the municipal taxes and while computing his income from income from house property (or income from other sources), such taxes shall be allowed to be deducted in accordance with S. 23 (if chargeable under the head of "income from house property") or u/s 57 (if chargeable under the head of "income from other sources".

As per S.57 (iii) any other expenditure (not being in the nature of capital expenditure) laid out or expended wholly and exclusively for the purpose of making or earning such income is allowed to be deducted while computing the income u/s 56.

Non-payment of taxes can even lead you to lose the property without which you can not earn rental income and therefore is an allowable expense.

Do not go without a rental/lease agreement, or you may consider the transfer of the property in your name or in the name of your business (after considering the capital gain implications).

Or perhaps NOC from the father for use of his premise for your business. Leaving this matter un-attended does not feels correct.