Opinion Of Eminent Legal Luminaries On Controversial Issues

Income from house property – Deduction u/s. 24

QUERY: Is it permissible to show rental income from shops u/s. 22 & claim any deduction in the hands of the Trust?
ANSWER: ‘Owner’ for the purpose of section 22 may be an individual, a company, a firm, an association of persons or an artificial juridical entity. The term “owner” includes a legal owner such as a trustee, an executor and an official assignee or an official receiver etc. Thus, the trustee of the Trust or trust can be owner.
Similarly, as per the Supreme Court in East India Housing and Land Development Trust Ltd. [42 ITR 49], shops, Bazaars and stalls are buildings within the meaning of section 22 and fall to be chargeable under that section. Thus income from a market consisting of shops, bazaars, stall and open spaces appurtenant to the building in the hands of the owner thereof would be assessable under the head “Income from house property”. This is on the basis that the words “buildings” and “house property” are not defined in the Act and they have to be understood in the same sense and in their ordinary dictionary meaning. Further sections 22 to 27 of the Act are wholly silent as to the purpose for which a building or a house property is to be used [see CIT v. Kanaiyalal Nimani and Others [120 ITR 892 (Cal.)]
So, once a property falls under section 22 and it is owned by the Trust, deductions mentioned under section 24 are available.
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