There 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!!
It should be taxable under the head Income from House Property.
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.
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
CAclubindia
