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Rent received from cellphone tower

**KK** (B.Com. MBA. Pursuing CA & CS)   (255 Points)

27 January 2012  

Rent Received for letting out his vacant land to cellphone company for tower...It is chargeable under which head of income?

The cellphone company pays rent to assessee as "Payment of Building Rent"...


 16 Replies

CS,CA F,Numrologi TusharSampat (CS CA F Numerologist Astrologer Graphologist Face reader Vastu Expert)   (85905 Points)
Replied 27 January 2012

In ma view its chargeable under Income from house property as u said vacant land is given on rent.

Wait for others to comment.

1 Like

Z (         ) (2945 Points)
Replied 27 January 2012

The property would be out of the scope of sec 22 if only land and no building or land NOT appurtenant to building is rented

Therefore in my opinion it should be u/h income from other sources provided its not coming u/h PGBP 

1 Like

P.SUHAS (FINANCIAL ADVISOR) (82 Points)
Replied 28 January 2012

Income from House Property

1 Like

kanagaraj (CHARTERED ACCOUNTANT) (793 Points)
Replied 28 January 2012

The income is under income from other sources only. You are not supposed to show it under income from house property

1 Like

CS,CA F,Numrologi TusharSampat (CS CA F Numerologist Astrologer Graphologist Face reader Vastu Expert)   (85905 Points)
Replied 28 January 2012

@ Kanga raj  when there is a landlord tenant relationship and since consideration is recived for letting out vacant land den i think it should be chargeable under House property pls justify ur view of taxing under other source?????????

Ramya (Internal Audit) (59 Points)
Replied 28 January 2012

it should be under income from other sources as rent is from vacant land.

Ramanuj (Accountant.) (829 Points)
Replied 28 January 2012

I think it is come under Income from Other source.

Thanks

Regards

Ramanuj

 

1 Like

Ramanuj (Accountant.) (829 Points)
Replied 28 January 2012

I think it is come under Income from Other source.

Thanks

Regards

Ramanuj

 

santhosh kumar (article student) (79 Points)
Replied 28 January 2012

it is chargeable under head INCOME FROM OTHER SOURCE.The reason is income from letting house property is taxed under head "houseproperty" and the definition of house property isbuildings or lands appurtenant thereto.in the above case only land is given on rent to cell phone compnay.no building is attached to it .

1 Like

**KK** (B.Com. MBA. Pursuing CA & CS)   (255 Points)
Replied 28 January 2012

Thanks a lot guys for ur reply.... but then let me widen it some more... 

If it is not covered under building or land appurtenant thereto then why the cell phone company declares it as "Payment of Building Rent"??? and tell me also know whether the Cellphone tower comes under building or land appurtenant ???

Bhav Bhuti Sharma (Towards Professionalism )   (823 Points)
Replied 28 January 2012

The word property in section 22 to 27 have been not been used in a wider sense or meaning . It is very much limited to a type defined by the language of the section i.e. buildigs or land appurtenant there to (Chitpore Golabari Co P Ltd V CIT (1971) 82 ITR

So by the above case you have to try to understand the limited defination of building and land appurtenant.

Indications for this are while calculating Income from house property you come across Standard rent, Municipal value. you would not be able to get these figures for your calculation.

Moreover there is a case law not exactly matching your case but you can get a hint from the same

If a land appurtant thereto yealds any independent and commercial income such income shall be taxed under business income or income from other sources
(Ramalakshmi Reddy (M) v CIT (1998) 232 ITR 281 (Mad)

2 Like

santhosh kumar (article student) (79 Points)
Replied 29 January 2012

THANK YOU FOR UR REPLY BHAV

mannu (1/2 CA) (589 Points)
Replied 29 January 2012

hi...tell me its tds aspect......how much tds will be deducted..........????

BHARAT BAMBHAROLIYA (CA FINAL) (57 Points)
Replied 29 January 2012

 Income received for vacant land is taxable under other source income.

1 Like

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