Ajit K.Sengupta, J. - (1.) This reference relates to the assessment year 1975-76. The question is whether there was any mistake apparent from the record which could be rectified under Section 154 of the Income-tax Act.
(2.) Shortly stated the facts are that the Income-tax Officer framed the assessment for the assessment year 1975-76, in the case of the assessee company on January 2, 1976. The assessee had leased out its land and also calender machines and sizing machines along with the building. It showed receipt of rent of Rs. 6,000 from the land and of Rs. 60,069 from the calender machines and sizing machines and the building in which they were fitted. The said income of Rs. 66,069 (Rs. 6,000 plus Rs. 60,069) was assessed by the Income-tax Officer under the head "House property". The assessee thereafter filed an application dated April 16, 1977, before the Income-tax Officer for rectification of a mistake in the assessment order. The contention of the assessee in the said application was that the land was not appurtenant to any building of the company not used for its business and was given on lease for 90 years and, therefore, the income of rent from the land could not be treated as house property income. According to the assessee it was to be assessed under the head "Other sources".
(3.) The further contention of the assessee was that the rental income of Rs. 60,069 comprised rent for sheds with plant and machinery for calendering and sizing and other sheds in the factory including a godown. It was thus contended that the income from those assets could not be treated as income from "House property" and should be assessed under the head "Business". It was also the contention of the assessee in the said application that depreciation was allowed on the said machinery and plant and buildings and they were being used as business assets.;