(The Judgment of the Court was made by CHITRA VENKATARAMAN, J. ) The Tax Case Appeal is filed by the Revenue against the common order of the Income Tax Appellate Tribunal, Chennai 'D' Bench dated 03.08.2004 in ITA.No.1236 to 1241/(Mds)/2003 relating to the assessment years 1992-93 to 1997-98 raising the following substantial questions of law:-

"1. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the CIT (Appeals) was correct in cancelling the reopening of the assessment for the assessment years in question on the ground that there was no fresh information and there was failure on the part of the assessee to disclose material facts without considering the fact that the returns had only been processed under section 143(1)(a) and the restrictions of reopening of assessments applicable to assessments u/s.143(3) were not applicable to intimations u/s.143(1)(a) ?

2. Without prejudice to the first question, whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in cancelling the reopening of the assessment for the assessment year under consideration on the ground that it was based on audit objection, without following the decision of the Supreme Court 237 ITR 13 relied on by the Revenue ?

3. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the income was not assessable under the head 'income from property' but was assessable under the head 'business' merely on the ground that the land on which the super-structure was built had been taken on lease overlooking the fact that the provisions for computation of in come under the head 'income from property' envisaged such a situation and provided for allowing the rent paid for the grounds as a deduction while computing income from house property owned by the assessee ?"

2. By a common order, the Income Tax Appellate Tribunal held that the income from letting out of the property was to be assessed as "business income". In so holding, the Tribunal considered the assessee's claim on the Officer's jurisdiction to deal with the assessment under Section 147 of the Income Tax Act, 1961, since there was no new information in possession of the Assessing Officer to reopen the assessment. Following the decisions in the case of CIT Vs. Sanmar Holdings Ltd reported in (2003) 129 Taxman 25 (Mad), in the case of ACIT Vs. Saptarshi Services Ltd reported in (265 ITR 379 (Guj)), the Tribunal held that the proceedings taken under Section 147 of the Income Tax Act, 1961 was bad in law. Thus, the Tribunal allowed the assessee's claim both on the aspect of jurisdiction to deal with the assessment under Section 147 of the Income Tax Act, 1961 as well as on the character of the receipt. Aggrieved by the same, the Revenue is on appeal before this Court.

3. The assessee herein is a company stated to have been incorporated with the object of carrying on business in real estate developing landed properties, promoting and setting up of a market thereon. The assessee claimed that the income derived from letting out of the properties was "business income" and was not to be taxed as "income from house property". While passing the assessment order under Section 143(1)(a) of the Income Tax Act, 1961, originally, the Assessing Officer accepted the claim of the assessee that the income thereon from letting out the property was "business income". However, proceedings under Section 147 of the Income Tax Act, 1961 was invoked on the basis of the decision of this Court in the case of Commissioner of Income Tax Vs. Indian Metal and Metallurgical Corporation reported in 215 ITR 424, wherein, this Court held that income received from letting out of property is to be assessed only as "income from house property".

4. The assessee filed its objection stating that the interpretation of law based on the decision of this Court reported in 215 ITR 424 ( Commissioner of Income Tax Vs. Indian Metal and Metallurgical Corporation) had no relevance to the facts of the case. Placing reliance on the decision of the Hon'ble Supreme Court in Indian and Eastern Newspaper Society Vs. Commissioner of Income Tax reported in 119 ITR 996 as well as on the decision in the case of Commissioner of Income Tax Vs. LKS Jewellers reported in 109 Taxman 114, the assessee contended that the opinion of the audit party as regards the application or interpretation of law could not be the basis for reopening the assessment. The assessee further contended that having regard to the business of the assessee to develop properties, the commercial complex constructed over the leasehold land was a commercial asset utilised for the purpose of the business, consequently, the income derived therefrom on letting out of the property had to be assessed only as "business income".

5. A reading of the order of assessment shows that the Assessing Officer rejected the assessee's contention and held that the decision of this Court reported in 215 ITR 424 (Commissioner of Income Tax Vs. Indian Metal and Metallurgical Corporation), which was rendered under similar circumstances would apply to the facts herein. The Assessing Authority held that the transaction being one of exploitation of the property as an owner and not by way of exploitation of business assets, the assessment of the rental receipts as "business income" would not arise but to be assessed under the head "income from house property" under Section 22 to 24 of the Income Tax Act. Aggrieved by the same, the assessee went on appeal before the Commissioner of Income Tax (Appeals).

6. In respect of the above said assessments, the assessee reiterated its contentions as taken before the Assessing Officer. By a common order, the Commissioner of Income Tax (Appeals) considered the question as to whether there was mere change of opinion by the Officer for reopening the assessment and ultimately the Commissioner of Income Tax (Appeals) came to the conclusion that the reopening of the assessment was the result of the Audit Objection. Thus accepting the contention of the assessee, based on the decision of this Court reported in 215 ITR 424 ( Commissioner of Income Tax Vs. Indian Metal and Metallurgical Corporation) and the decision of the Supreme Court, the Commissioner of Income Tax (Appeals) held that the Assessing authority wrongly applied the law to the facts herein. In the circumstances, following the decision of the Gujarat High Court in the case of Gujarat Ginning Factory Ltd reported in (94) 205 ITR 40 (Guj), in the case of Balaji Enterprises reported in (97) 225 ITR 471 (Kar), in the case of Shah Brothers reported in (99) 110 Taxmann 40 (Karnataka), the Commissioner of Income Tax (Appeals) agreed with the view of the assessee that the income was to be assessed under the head "business income" and not under "income from house property". Aggrieved by the same, the Revenue went on appeal before the Income Tax Appellate Tribunal, wherein, the Department placed reliance on the decision of the Apex Court in the case of the CIT Vs. P.V.S.Beedies Pvt Ltd., reported in 237 ITR 13 on the aspect of the reopening of the assessment.

7. The Tribunal accepted the contention of the assessee that the reopening of the assessment was made based on the change of opinion and there were no fresh information available. Thus holding , it rejected the Revenue's appeal.

8. Learned Standing counsel appearing for the Revenue brought before us the decision of the Apex Court in the case of A.C.I.T Vs. Rajesh Jhaveri Stock Brokers P.Ltd reported in 291 ITR 500 (SC), wherein, the Apex Court pointed out to the scope of Section 143(1) as well as Sections 147 and 148 of the Income Tax Act, 1961, only to hold that Section 147 as substituted with effect from April 1, 1989, enabled the Officer to reopen the assessment. So long as the ingredients of Section 147 of the Income Tax Act, 1961 are fulfilled, the Assessing Officer is free to initiate proceeding under Section 147 of the Income Tax Act, 1961 to reopen the assessment. Considering the provisions of section 143(1)(a) of the Act, as it stood during the relevant assessment years under consideration, the moment the Officer found that the assessment had been wrongly made and that the facts were not under any controversy, rightly, the Officer concerned applied the law of this Court following the Apex Court decision under similar circumstances to the case of the assessee to assess the rental receipts as "income from house property".

9. Learned Standing counsel for the Revenue further placed reliance on the decision of the Apex Court in the case of East India Housing and Land Development Trust Ltd Vs. CIT reported in 42 ITR 49 (SC), in the case of CIT Vs. Indian Metal and Metallurgical Corporation reported in 215 ITR 424 (Mad), in the case of (1)Universal Plast Ltd (2) Guntur Merchants Cottpn Press Co. Ltd. , Vs. CIT reported in 237 ITR 454 (SC), which were all considered in the case of CIT Vs. Chennai Properties and Investments Ltd., reported in 266 ITR 685 (Mad), that income from letting out of the property in case of company carrying on business in real estate, in construction and letting out of properties has to be assessed as "income from house property" and not as "business income". In the light of the above said decisions, the Tribunal committed serious error in allowing the claim of the assessee. He placed reliance on the decision of this Court in the case of Keyaram Hotels (P) Ltd Vs. Assistant Commissioner of Income Tax reported in (2008) 300 ITR 118 (Mad), which, once again reiterated the law declared by this Court by following the Supreme Court decision. Learned Standing Counsel for Revenue thus prays for setting aside the order of the Tribunal.

10. Per contra, learned counsel for the assessee relied on decision of the Supreme Court in the case of Indian & Eastern Newspaper Society, New Delhi Vs. Commissioner of Income Tax, New Delhi reported in (1979) 119 ITR 996, in the case of Vishwanath Vs. Asst. Controller of Estate Duty reported in (1983) 139 ITR 610 (Indore), in the case of Commissioner of Income Tax Vs. Lucas T.V.S.Ltd., reported in (1998) 234 ITR 296 (Mad), the decision of the Bombay High Court in the case of Sesa Goa Ltd., Vs. Joint Commissioner of Income Tax and Others reported in (2007) 294 ITR 101 (Bom) as well as in the case of Transworld International Inc. Vs. Jt. Commissioner of Income Tax reported in (2005) 273 ITR 242 (Delhi) on the question as to whether Audit Objection could be the basis for reopening the assessment and submitted that the assessment could not be reopened based on subsequent decision, To do so in the absence of any fresh material would amount to change of opinion. Placing reliance on the decision in the case of Commissioner of Income Tax, Spl.Range II Vs. Sanmar Holding Ltd., reported in (2005) 272 ITR 345(Mad) as well as order passed in T.C.A.707 to 709 of 2005 (Commissioner of Income Tax, Spl.Range II Vs. Sanmar Holdings Ltd) , in the case of Commissioner of Income Tax Vs. D.S.Promoters and Developers Pvt Ltd., reported in (2009) 183 TAXMAN 153 (Delhi), he pointed out to the memorandum of the Company that when the business of the Company is essentially one of construction and letting out properties, income from letting out of the property has to be assessed only as "business income". Even in the case of CIT Vs. Chennai Properties and Investments Ltd reported in 266 ITR 685 (Mad), this Court had pointed out to various decisions and laid down propositions, which have to be satisfied before assessing the income as "business income" or "income from house property". In the light of the above said facts and the decisions relied on, rightly, the Tribunal came to the conclusion that there was only change of opinion and that cannot be the basis for initiating proceedings under Section 147 of the Income Tax Act, 1961. Having regard to the nature of business carried on by the assessee, as a fact finding authority, the Tribunal held that business is assessable only as "business income".

11. Referring to the contention of learned Standing counsel, placing reliance on the decision of the Supreme Court in the case of ACIT Vs. Rajesh Jhaveri Stock Brokers P.Ltd., reported in 291 ITR 500 (SC), learned counsel for the assessee pointed out that the Tribunal had not considered this aspect on the jurisdiction issue but held that the Audit Party Objection was the only reason on which the Assessing Officer resorted to reopen the assessment. Neither the Tribunal nor the Appellate Authority considered the jurisdiction issue. In fitness of things, the matter may have to be remanded to the Assessing Officer for de novo consideration.

12. Heard learned Standing counsel for the Revenue as well as learned counsel for the assessee and perused the materials available on record.

13. At the outset, we would state that in the light of the Apex Court decision in the case of ACIT Vs. Rajesh Jhaveri Stock Brokers P.Ltd reported in 291 ITR 500 (SC), we do not think that it is a fit case for remand to the Assessing Officer to consider the issue on reopening under Section 147.

14. A reading of the decision of the Apex Court reported in 291 ITR 500 (SC)( ACIT Vs. Rajesh Jhaveri Stock Brokers P.Ltd-), particularly, in the context of provisions of Sections 147 and 148 of the Income Tax Act, 1961 (hereinafter called as the "Act"), after amendment, as well as section 143(1)(a) of the Act as it stood at the relevant point of time shows that with the substitution of Section 147 of the Act, as well as amendment to Section 148 of the Act with effect from 01.04.1989, the Officer is endowed with the jurisdiction to initiate proceedings under Section 147 of the Act, in cases, where he has reason to believe that income has escaped assessment. The Apex Court pointed out to the provisions as it stood prior to the amendment in 1989 that under the original provision, two conditions were required to be satisfied viz., the Officer must have reason to believe that income, profits or gains chargeable to income tax have escaped assessment and secondly, he must also have reason to believe that such escapement is either on account of omission or failure on the part of the assessee to disclose fully or truly all material facts necessary for his assessment of that year.

15. Noting the substantial change made to Section 143 of the Act with effect from 01.06.1999, the Supreme Court pointed out that up to March 31st, 1989, after a return was filed, the Officer could make an assessment under Section 143(1) of the Act, without requiring the presence of the assessee or the production by him of any evidence in support of the return. Where the assessee objected to such an assessment or where the officer was of the opinion that the assessment was incorrect or incomplete or the officer did not complete the assessment under Section 143(1), but wanted to make an inquiry, a notice under Section 143(2) was required to be issued to the assessee requiring him to produce evidence in support of his return. After considering the material and evidence produced and after making necessary inquiries, the officer had power to make assessment under Section 143(3). With effect from April 1, 1989, the provisions underwent substantial and material changes. A new scheme was introduced and in the new substituted section 143(1) prior to the subsequent substitution with effect from June 1, 1999, in clause (a), a provision was made that where a return was filed under Section 139 or in response to a notice under Section 142(1), and any tax or refund was found due on the basis of such return after adjustment of tax deducted at source, without prejudice to the provisions of section 143(2) an intimation was to be sent to the assessee specifying the sum so payable and such intimation was deemed to be a notice of demand issued under Section 156 for the apparent purpose of making machinery provisions relating to recovery of tax applicable. The first proviso to section 143(1)(a) allowed the Department to make certain adjustments in the income or loss declared in the return. The Supreme Court held that there being no assessment under section 143(1)(a) of the Act, the question of change of opinion, did not arise. The Supreme Court also held that with Section 147 permitting the Officer to assess or reassess the income chargeable to tax when he has reason to believe income escaping assessment, the mere failure to take steps under Section 143(3) would not render the Assessing Officer powerless to initiate reassessment proceedings under Section 147 of the Act even when intimation under Section 143(1) had been issued. In the light of the above said decision of the Apex Court, which was rendered on 23.05.2007, we do not think that the reliance on the decision of the Bombay High Court in the case of Sesa Goa Ltd., Vs. Joint Commissioner of Income Tax and Others reported in (2007) 294 ITR 101 (Bom) could be of any assistance to the assessee. So too, the reliance on the decision in the case of Indian & Eastern Newspaper Society, New Delhi Vs. Commissioner of Income Tax, New Delhi reported in (1979) 119 ITR 996.

16. The decisions therein have to be seen in the context of the provisions as they stood therein. Thus, with the amendment brought to Section 147 of the Act, on and from 01.04.1989 and the elucidation on the scope of the authority and jurisdiction of the Officer under Section 147 of the Act as given in the above referred decision of the Apex Court, we have no hesitation in holding that the Tribunal committed serious error in holding that there was no material to justify the resort to Section 147 proceedings. Consequently, substantial question No.1 is answered in favour of the Revenue. In so holding, we have no hesitation in rejecting the assessee's prayer to remit the matter to the Assessing Officer. We do not think that any worthwhile exercise could be carried on by the Assessing Officer to consider the question as to whether assessment could be reopened, on the basis of the objection of the Audit party, which contention has no relevance for the purpose of considering the assessment under Section 147 of the Act, having regard to the order under section 143(1)(a) of the Act.

17. In the light of the above, we reject the prayer of the assessee for remand. Consequently, we also hold that substantial question No.2 merits to be answered in favour of the Revenue.

18. In view of the above findings, the only question that is left behind is whether income from letting out of the property is to be assessable as "business income" or "income from house property".

19. Learned Standing Counsel appearing for the Revenue in this regard placed heavy reliance on the decision of the Supreme Court in the case of East India Housing and Land Development Trust Ltd Vs. CIT reported in 42 ITR 49 (SC), in the case of CIT Vs. Indian Metal and Metallurgical Corporation reported in 215 ITR 424 (Mad) as well as in the case of CIT Vs. Chennai Properties and Investment Ltd, reported in 266 ITR 345 (Mad).

20. As far as the first cited decision reported in 42 ITR 49(SC) (East India Housing and Land Development Trust Ltd Vs. CIT) is concerned, the assessee therein is a company formed with the object of promoting real estate business and developing markets. It claimed that the income derived from shops let out was to be assessed under section 10 of the 1922 act as "profits or gains" of business. In considering the question, the Supreme Court pointed out that the mere fact that the assessee had to obtain licence from the Corporation of Calcutta and to maintain sanitary and other services in conformity with the provisions of the Act, by itself, would not enable the assess to claim that income from letting out of the property was to be treated as "business income". Referring to different heads of income under section 6 of the 1922 act, the Apex Court pointed out as under:-

" If the income from a source falls within a specific head set out in S.6 the fact that it may indirectly be covered by another head will not make the income taxable under the latter head. The income derived by the company from shops and stalls is income received from property and falls under the specific head described in S.9. The character of that income is not altered because it is received by a company formed within object of developing and setting up markets. In United Commercial Bank Ltd Vs. CIT (1957) 32 ITR 688 (SC) this Court explained after an exhaustive review of the authorities that under the scheme of the IT Act, 1922, the heads of income, profits and gains enumerated in the different clauses of S.6 are mutually exclusive, each specific head covering items of income arising from a particular source."

In so holding, the Apex Court ultimately held as follows:-

" The income received by the appellant from shops is indisputable income from property ; so is the income from stall from occupants. The character of the income is not altered merely because some stalls remain occupied by the same occupants and the remaining source of income from the stalls is occupation of the stalls, and it is a matter of little moment that the occupation which is the source of the income is temporary. The IT authorities were, in our judgment, right in holding that the income received by the appellant was assessable under S.9 of the IT Act."

21. In the decision reported in 215 ITR 424 (Mad) (CIT Vs. Indian Metal and Metallurgical Corporation), which was referred to by the Assessing Officer, this Court considered the case of the assessee, who was the owner of multi-storeyed building, in which, a part of the building in the first, second and fourth floors were let out with amenities. The Tribunal held that the income derived by the assessee should be treated as "income from other sources". On a reference before this Court, reversing the order of the Tribunal, this Court held that the income derived by the assessee could not be assessed as "income from other sources". In so holding, this Court pointed out to the decision of the Apex Court in Sultan Brothers' case reported in (1964) 51 ITR 353 and distinguished the same and held that when the assessee had let out the building along with amenities, the assessee derived income from letting out of the property owned by it, in the circumstances, the question of the income derived by the assessee from letting out of the property viz., first, second and fourth floors could not be assessed as income from "other sources", but to be assessed as "income from house property".

22. In the decision reported in 266 ITR 685 (Mad) (Commissioner of Income Tax Vs. Chennai Properties and Investments Ltd), this Court elaborately considered the decisions of the Apex Court as well as this Court and pointed out that the question as to whether letting out of the property results in "business income" or "income from property" is to be decided based on the facts of each case. Pointing out to the decision in the case of East India Housing (1961) 42 ITR 49 (SC) as well as in the case of Karanpura Development Co.Ltd Vs. CIT reported in (1962) 44 ITR 362(SC), in the case of Sultan Brothers (1964) 51 ITR 353 (SC), approving the reasoning in the decision reported in 42 ITR 49 (East India Housing and Land Development Trust Ltd., Vs. CIT), this Court further pointed out to the decision reported in (1964) 51 ITR 353 (SC)(Sultan Brothers case), holding that income from letting out of the property, even in case of company carrying on business in real estate as well as having rental income from the property owned by the assessee has to be assessed as "income from house property". This Court in Chennai Properties case, further pointed out as follows:-

" Though it is not clear from the context as to why the Act describes income from property as income from house property, the substantive provision of law which creates the charge and obligates the person who receives such income to have it assessed under the head does not confine its application only to house property, but extends to all buildings whether such building is used as dwelling house or for other purposes."

23. It further pointed out therein that there had been a consistent view by the Apex Court in all these cases that even if the assessee's business was in real estate, the income on letting out of the property was to be assessed as "income from house property". The only exception are cases, where the letting of the building was inseparable from the letting of the machinery, plant and furniture. In such cases, it was held that the rental income would not have been realised, but for the letting out of the machinery, plant or furniture along with such building and therefore, the rental received for the building had to be assessed under the head "Income from other sources". It was reiterated that where the owner of the property exploited the property by leasing out the same and realised income by way of rent, the same was to be assessed under the head "Income from house property" and not as "business income". The said decision was applied in the decision of this Court in the case of Keyaram Hotels (P) Ltd Vs. Assistant Commissioner of Income Tax reported in (2008) 300 ITR 118 (Mad).

24. The Supreme Court in the decision of (1) Universal Plast Ltd., (2) Guntur Merchants Cotton Press Co. Ltd Vs. Commissioner of Income Tax laid down the following ratio :-

"(1) no precise test can be laid down to ascertain whether income (referred to by whatever nomenclature, lease, amount, rents, licence fee) received by an assessee from leasing or letting out of assets would fall under the head "Profits and gains of business or profession";

(2) it is a mixed question of law and fact and has to be determined from the point of view of a businessman in that business on the facts and in the circumstances of each case, including true interpretation of the agreement under which the assets are let out ;

(3) where all the assets of the business are let out, the period for which the assets are let out is a relevant factor to find out whether the intention of the assessee is to go out of business altogether or to come back and restart the same ;

(4) if only a few of the business assets are let out temporarily, while the assessee is carrying out his other business activities, then it is a case of exploiting the business assets otherwise than employing them for his own use for making profit for that business ; but if the business never started or has started but ceased with no intention to be resumed, the assets also will cease to be business assets and the transaction will only be exploitation of property by an owner thereof, but not exploitation of business assets."

25. In the background of the above said decisions, we reject the reliance placed on by the learned counsel for the assessee in the decision reported in the case of Commissioner of Income Tax, Spl.Range II Vs. Sanmar Holdings Ltd., reported in (2005) 272 ITR 345 (Mad). The said decision related to a case, where one of the objects of the Company was to deal in shares, stocks, debentures, bonds, obligations, chits, securities and to purchase, take on lease or in exchange, hire or otherwise acquire and deal in any movable or immovable property. In respect of rental income, the question arose as to whether the income was to be assessed as a "business income" ; this Court referred to the decision of the Apex Court in Sultan Brother P.Ltd Vs. CIT (1964) (51 ITR 353) and pointed out whether a particular letting was "business" had to be decided in the circumstances of each case and each case had to be looked at from a businessman's point of view to find out whether the letting was the doing of a business or the exploitation of the property as an owner. This Court referred to the decision in Sultan Brother P.Ltd., Vs. CIT (1964) 51 ITR 353 and held that before invoking Section 22 of the Act, for the purpose of assessing the rental income as an "income from the house property", the revenue authorities must go into the question whether there was any exploitation of the property by their owner by giving it away for rent, before assessing such rental income as an income from house property. Going through the records, this Court held that in the absence of any finding on this aspect, the proper course would be to remand the matter back to the Assessing Officer for de novo consideration. In the light of the above said decision, this Court remitted the matter to the Assessing Officer.

26. It is seen from the order of assessment that the assessee took on lease the land and building owned by Mr.Sethu-Director of the Company. The assessee constructed the commercial complex and received rental income therefrom. The Assessing Officer pointed out that it was the only activity carried out during the year 1991-92 ; there were no other activity thereafter carried on ever since 1991-92. Under such circumstances, the Assessing Officer concluded that there was no such thing as exploitation of business assets. There are no materials placed before us by the assessee to contradict the above said facts.

27. It was highlighted by learned counsel for the assessee that the assessee herein is not the owner of the land but only owner of the superstructure and submitted for application of the above said decision to the cases on hand for a remand. We do not think the facts of the present cases warrant such remand.

28. We have already referred to the decision of the Apex Court in East India Housing and Land Development Trust Ltd Vs. Commissioner of Income Tax reported in (1961) 42 ITR 49 (SC), which was also considered in the case of (1)Universal Plast Ltd., (2) Guntur Merchants Cottpn Press Co.Ltd Vs. CIT reported in 237 ITR 454. The question involved therein was as to whether income from letting of the property was to be treated as "business income" or not. As has been pointed out in the decision in the case of (1)Universal Plast Ltd., (2) Guntur Merchants Cottpn Press Co.Ltd Vs. CIT reported in 237 ITR 454, when the facts noted in the case before us clearly point out that the transaction was only by way of exploitation of the property by the assessee and not by way of exploitation of business assets, we do not find any ground to accept the contention of the assessee that the nature of business carried on by the assessee would be conclusive of the nature of receipts on the letting of the property. Going by the decision in East India Housing and Land Development Trust Ltd., Vs. Commissioner of Income Tax reported in (1961) 42 ITR 49 (SC), when the rental income falls within the specific head of income from house property, the mere fact of the assessee having business in letting out the property as stated in its memorandum, by itself, will not conclusively point out that the income is nothing but business income. Even in the case of Commercial Properties Ltd., Vs. CIT reported in (1928) 1 LR 55 Calcutta, a decision which was confirmed by the Apex Court, it was held that rental income derived by a company, whose sole object was to acquire lands, build houses and let them to tenants and whose sole business was management and collection of rents from the said properties, was held assessable under Section 9 and not under Section 10 of the Income Tax Act.

29. Thus, applying the decision in the case of East India Housing and Land Development Trust Ltd Vs CIT reported in 42 ITR 49 (SC) to the facts as found by the Assessing Officer that the assessee had no other activity during 1991-92 too, this Court accepts the case of the Revenue that income received from letting out of the property was rightly assessed by the Officer as "income from property". In the circumstances, we set aside the order of the Tribunal.

30. In the result, we allow the Tax Case Appeals and the substantial questions of law are answered in favour of the Revenue.

nvsri To

1.Commissioner of Income Tax, Salem

2.The Commissioner of Income-Tax(Appeals) Salem

3.The Income Tax Appellate Tribunal Bench 'D', Chennai