| Case ID |
e2ecfdba-d770-482f-89b1-b8368d3e35ba |
| Body |
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| Case Number |
1946 SLD 46 |
| Decision Date |
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| Hearing Date |
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| Decision |
The court held that the rent derived from the buildings erected by the assessee was properly assessed under section 9 of the Income-tax Act, 1922. The court affirmed that the assessee, a public limited company, was the owner of the structures during the currency of the lease. The lease agreement stipulated that the lessors would only acquire ownership of the buildings upon the expiration of the lease, thus validating the assessment under section 9. The court also referenced previous judgments to support that ownership, not the nature of the enterprise, dictates tax obligations under the Income-tax Act. |
| Summary |
In this significant case adjudicated by the Calcutta High Court, the court examined the tax implications surrounding the ownership of structures erected by a lessee on leased land. The primary issue was whether the income derived from the rent of these buildings should be assessed under section 9 of the Income-tax Act, 1922, or considered as profits and gains of business under section 10. The case revolves around the legal principles of property ownership, lease agreements, and the taxation of income derived from property. The court concluded that the lessee maintained ownership of the structures throughout the lease term, with ownership only transferring to the lessor upon lease expiration. This decision is pivotal for understanding the intersection of property law and taxation, particularly the implications for companies engaged in real estate development and management. Keywords such as 'Income-tax Act', 'property ownership', and 'real estate taxation' are vital for those studying property law and taxation, as they reflect ongoing discussions in legal and financial circles. |
| Court |
Calcutta High Court
|
| Entities Involved |
Commissioner of Income Tax,
Ballygunge Bank Ltd
|
| Judges |
Gentle, J.,
Ormond, J.
|
| Lawyers |
J.N. Majumdar,
R.B. Bakshi,
Amal Kumar Mukherji,
P.C. Basu,
Sachindra K. Roy,
Sushil K. Biswas,
S.K. Gupta,
J.C. Pal
|
| Petitioners |
Ballygunge Bank Ltd
|
| Respondents |
Commissioner of Income Tax
|
| Citations |
1946 SLD 46,
(1946) 14 ITR 409
|
| Other Citations |
Commercial Properties Ltd., In re [1928] ITR 55,
Kaladan Suratee Bazaar Co., In re [1920] 1 ITC 50
|
| Laws Involved |
Income-tax Act, 1961,
Indian Income-tax Act, 1922,
Transfer of Property Act, 1882
|
| Sections |
22,
9,
9,
10,
108(h)
|