IN THE HIGH COURT OF DELHI AT NEW DELHI 
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  17.01.2011 
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 Present:        None. 
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 +ITA No.42/2011 
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 Some rentals were received by the assessee and the rental income was 
 shown as ?income from house property? on which 30% deduction under Section 24 of 
 the Income Tax Act was claimed.  Assessing Officer disallowed the said deduction 
 treating it as ?business income?.  The CIT(A) reversed the decision of the 
 Assessing Officer holding it to be a ?rental income? and not ?business income? 
 and that order is upheld by the ITAT observing as under: 
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 ?6.       We have heard both the counsels and perused the records.  Both the 
 counsels fairly agreed that the issue is covered in favour of the assessee by 
 the decision of the Tribunal in assessee?s own case in ITA no.2795 for preceding 
 assessment year.  Vide order dated 4.9.2009 the Tribunal had adjudicated the 
 issue as under:- 
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 ?6.       We have heard both the counsel and perused the record.  We find 
 that it is an admitted fact of the case that the assessee had obtained office 
 premises on lease and sub-let the same and derived income therefrom.  In the 
 view of the authorities below, in order to derive income from house property, 
 the assessee has to be registered owner thereof.  In our 
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 ITA No.42/2011                                                        Page 1 of 
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 opinion this view is not sustainable on the anvil of Apex Court decision 
 delivered in the case of C.I.T. vs. Poddar Cement Pvt. Ltd.  in 226 ITR 625. 
 Further the contention that letting out of office space when not required can be 
 the business income is not sustainable on the anvil of decision of the Hon?ble 
 Jurisdictional High Court in the case of Smarts (P) Ltd. vs. C.I.T. (2008) 166 
 Taxman 53 (Delhi).  In this case it was held that ?where the assessee in 
 occupation of rented premises sub-let a portion thereof and claimed that income 
 from such sub-letting was assessable as business income, the department was 
 justified in assessing the said income under ?income from house property?, in 
 view of the fact that the assessee was in full control in his capacity as a 
 tenant, and had earned income by sub-letting the property.  In situations of 
 this type, there is nothing to suggest that ownership of the premises is 
 essential for levying tax under the head ?income from house property.? 
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 These are pure findings of fact and no question of law arises. 
 The appeal is dismissed. 
 A.K. SIKRI, J. 
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 M.L. MEHTA, J. 
 JANUARY 17, 2011 
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 ITA No.42/2011                                                        Page 2 of 
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