Meaning of “Building”

The meaning of building under section 22 of the Income Tax Act is not defined in the act itself. But we can take guidance from decisions by various high courts. Here are excerpts of courts orders in which the Hon’ble High Court tried to explain the meaning of building.

Meaning of building defined by court

The phrase ‘building’ used in section 22 of the Income Tax Act came up before various high courts as detailed under :

1. Hon’ble Madras high court explained the meaning of ‘building’ while delivering judgment in CIT vs. Chennai properties & investments ltd. [2004] 136 Taxman 202/266 ITD 685 (Mad.) as under :

Meaning : The word ‘building’ is not confined in its scope only to dwelling houses. ‘House’ is defined in the oxford dictionary of english, 10th edition as : a building for human habitation especially one that is lived in by a family or by a small group of people consisting of ground floor and one or more storeys. The word ‘house’ in association with other words also has many other meanings. But a commercial building is not regarded as a house. That, however, would not take the income from such buildings out of the ambit of section 22.

2. Hon’ble delhi high court explained the meaning of ‘building’ while delivering judgment in S. Sohan Singh vs. ITO [1986] 16 ITD 272 (Delhi – Trib.) as under :

Meaning : The meaning of the word ‘building‘ cannot be restricted merely to a dwelling house. The legislature has in its legislative wisdom used the wider term, namely, building instead of the word ‘house’ though the income is to be taxed under the head ‘income from house property’. It is also to be appreciated that the income which is to be taxed as income from house property is not restricted to merely the buildings but can also be derived from ‘lands appurtenant thereto’.

If there is a land appurtenant to the building income therefrom has to be taxed under the head ‘income from house property’. Similarly income from the terrace of the building cannot be taxed under the head ‘income from other sources’.

Section 22 of the Income Tax Act

Income from house property.

22. The annual value of property consisting of any buildings or lands appurtenant thereto of which the assessee is the owner, other than such portions of such property as he may occupy for the purposes of any business or profession carried on by him the profits of which are chargeable to income-tax, shall be chargeable to income-tax under the head “Income from house property”.

In this article, you can get guidance from high courts on the meaning of building under section 22 of the Income Tax Act.

Updated up to Finance Act 2021