Section 139(3) of the Income Tax Act
Income-tax Act, 2025: s.263
Section 139(3) falls under section 139 of the Income-tax Act, 1961, which corresponds to section 263 (Return of income) of the Income-tax Act, 2025.
Read section 263 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 139(3) is Rayala Corporation (P.) Ltd. v. Assistant Commissioner of Income-tax (72 Taxmann.com 149), cited in 22 of the 118 judgments on BharatTax that turn on this section.
Leading authorities on Section 139(3)
Income derived from renting out property by a company whose business, as per its Memorandum of Association, is commercial exploitation of property is to be treated as business income, even if it is in the nature of rent.
Whether a business is considered 'setup' depends on the specific facts of each case, considering whether the business involves manufacturing or providing services, and the nature of those services.
