JUDGMENT - Desai, J. 1. This is a reference under Section 66(1) of the Indian Income-tax Act (hereinafter referred to as the Act), and the questions which are raised thereon arise out of the orders of assessment of the National Storage Private Limited, Bombay (respondent herein) for the assessment years 1953-54, 1954-55, 1955-56 and 1956-57. The assessee company was promoted by the Film Distributors of Bombay and was Incorporated on the 23rd of October 1948. The activity of the company, which was set out m clause (1) of the Object clause of the Memorandum of Association was to carry on the business of storing and preserving films, chemicals, cinema accessories and any articles of merchandise in Cinema Industry in suitable vaults specially constructed for the purpose and equipped with all the necessary arrangement. Clause 2 enabled the assessee company to carry on the business of storage of articles in the Cinema Industry and for that purpose to build or construct such other vault or vaults as may be deemed necessary by the company. Clause (3) set out the object of the company as generally to carry of all sorts of business of Safe Deposit Vaults in all us aspects. Clause (5) authorised the company to acquire by purchase or lease a suitable plot of land and to construct thereon safe deposit vaults and other necessary buildings as may be thought fit by the company. What led to the incorporation of this company was the promulgation of the Cinematograph Film Rules, 1948, by the Government of India under which films were required to be stored in specially constructed premises strictly in conformity with the specifications laid down in the said rules and situated at places to be approved by the Chief Inspector of Explosives. Government of India. Under these rules, a place at Mahim was approved by the Chief Inspector of Explosives, Government of India, as a suitable place for the construction of the film godowns. The company alter its incorporation purchased a plot at Mahim, the place which was approved of by the Chief Inspector of Explosives, and constructed 13 units on the said plot of land in conformity with the specifications laid down in the Cinematograph Film Rules of 1948. The company alter its incorporation purchased a plot at Mahim, the place which was approved of by the Chief Inspector of Explosives, and constructed 13 units on the said plot of land in conformity with the specifications laid down in the Cinematograph Film Rules of 1948. 12 of these 13 units were constructed for members of the Indian Motion Pictures Distributors Association, who had taken part in the floating of me company and the 13th unit was made available for the use of Foreign Film Distributors in Bombay, who were not members of the Indian Motion Pictures Distributors Association. Each unit consisted of four vaults and each vault had a ground-floor for re-winding of films and an upper floor for storage of films. After the construction of these Units, the vaults were permitted by the company to be used by the Film Distributors on terms and conditions of the Agreements arrived at between them and the company. Some of these agreements, which were entered into with the members of the Indian. Motion Pictures Distributors Association, who had subscribed a large amount towards the share capital of the company, were classifies as A Licenses and the charges for these A Licences, were Rs. 407- per month. The other agreements, winch were entered into with members of the Indian Motion Pictures Producers Association, who had only supplied a small share of capital, were classified as B Licence-holders and were charged at Rs. 140/- per month. The Licences granted to the Foreign Film Distributors, for whom one Unit of four vaults was reserved, were charged at Rs. 300/-per month for each vault at the beginning but later on those charges were reduced to Rs. 100/- per month. Under these Agreements the right to use the vaults was given initially for a period of five years. The vault-holder was given a key of the vault but the key of the entrance, which permitted access to the vaults remained in the exclusive possession of the company. The company also rendered certain services to the vault holders. It had installed a fire alarm and had obtained the fire service from the Municipality for which it was paying a certain annual amount to the Municipality. It had opened two railway booking Offices in the premises free of charge for the convenience of the vault holders for dispatch and receipt of film parcels. It had installed a fire alarm and had obtained the fire service from the Municipality for which it was paying a certain annual amount to the Municipality. It had opened two railway booking Offices in the premises free of charge for the convenience of the vault holders for dispatch and receipt of film parcels. It was also running a canteen in the premises and had installed a telephone. It also appears that it had maintained a regular staff for running the aforesaid services in the form of a Secretary, a peon and two watchmen and a sweeper. Besides, the entire staff of the Indian Motion Pictures Distributors Association was paid Rs. 800/- by the company for the part-time services rendered by them. During the first three years after its incorporation, i.e. during the assessment years 1950-51, 1951-52 and 1952-53, the Department assessed the company under Section 10 of the Income-tax Act. For the subSEQuent four assessment years, which is the period in question in the present reference the Income-tax Officer took the view that the income which the company obtained was appropriately to be assessed under Section 9 and not under Section 10 of the Act. He accordingly made the assessment fell under Schedule A as income from property and not under Schedule D as income from business. Viscount Dunedin took the view that the income-tax was only one tax, a tax on the income of the person whom it was sought to assess, and that the different Schedules were the modes in which the Statute directed the tax to be levied. If the income of the assessee consisted in part of real property, it fell under Schedule A and had to be taxed under that Schedule and no other. In the case in question, he was of the opinion that the income arose from real property and, therefore, had to be taxed under Schedule A only. If the income of the assessee consisted in part of real property, it fell under Schedule A and had to be taxed under that Schedule and no other. In the case in question, he was of the opinion that the income arose from real property and, therefore, had to be taxed under Schedule A only. Lord Warrington in his speech observed: "The first question to be determined is whether in its capacity as landowner deriving rents from its land the Company is carrying on the trade within the meaning of Schedule D and the Rules thereunder, and if this question is answered in the negative the further questions raised and argued in this House do not arise." After examining the facts of the case, the learned and noble Lord observed: "There is nothing in the facts stated in the Case which would properly lead to the conclusion that in dealing with the property the Company is acting otherwise than an ordinary landowner would act in turning to profitable account the land of which he is the owner. It would in my opinion be impossible to hold that in such a case the landowner is carrying on a trade. Such a person would, I think, clearly be assessable under Schedule A only, and his taxable income would be measured by the conventional annual value and not by the amounts of the rents he actually received." He pointed out that the circumstance that a taxpayer was a limited company did not distinguish its operations from those of an individual. Nor could they be distinguished simply because its Memorandum of Association enabled it to build houses and let them out on rent. The company was just as capable as an individual of being a landowner and as such deriving rents without thereby becoming a trader. In his view it was the nature of the operations and not its own capacity which must determine whether it was carrying on a trade or not. 2. Lord Atkin based his conclusion on the ground that annual income derived from ownership of lands, tenements and hereditaments could only be assessed under Schedule A and in accordance with the Rules of that Schedule. In his opinion it made no difference that 1112 income so derived formed part of the annual profits of a trading concern. 3. 2. Lord Atkin based his conclusion on the ground that annual income derived from ownership of lands, tenements and hereditaments could only be assessed under Schedule A and in accordance with the Rules of that Schedule. In his opinion it made no difference that 1112 income so derived formed part of the annual profits of a trading concern. 3. Lord Macmillan took the view that landowning, however profitable, was not a trade within the meaning or the Income-tax Code. Property in land as a source of income was dealt with, and could only be dealt with, under Schedule A and the Rules of that Schedule prescribe how the income from landed property was to be ascertained and measured. He, however, observed: "....income from property which is taxable under, and only under, Schedule A is income derived from the exercise of property rights properly so called." In his opinion the income of the company was derived from the location of the land or in other words in the normal manner in which properly in land yielded revenue and it was, therefore, not possible to hold that it was its income from trade. A land-owner cannot be represented as carrying on a trade of owning land because he makes an Income by letting it. The relatively insignificant services for which the Company made charges to its tenants were not in his opinion sufficient to convert the Company from a landowner into a trader. 4. Mr. Joshi has very strongly relied on this case for his submission that it is not only where there is a bare letting of tenements but also in cases where further services such as cleaning, heating and lighting or the facilities of lifts and canteens are supplied, that the income derived is still the income from property and not income from business. It may, however, be noted that although there were some services rendered by the company to its tenants, these services were regarded as minor or incidental services not different from the services which an individual landlord provides to the tenants of his house property and it was held that the supply of these additional services did not constitute the activity as a trading activity and the source of the income still remained mainly the ownership of the property and the income therefrom was assessable under Schedule A. 5. 1961-42 ITR 49 (SC) is the next case referred to by Mr. Joshi. This was also a case of a limited company, which was incorporated with the objects of developing landed properties and promoting and developing markets. It had purchased a plot of land in the town or Calcutta and set up a market thereon. For the purpose of setting up this market the company had obtained a licence from the Calcutta Municipality to maintain sanitary and other services and for that purpose it had also maintained staff and had incurred expenditure. The market, which the company had set up, consisted of shops and stalls. It had let out the shops for longer terms and the stalls for temporary durations and had earned income from the said letting. The question that arose was whether the income realised by the company from the tenants of the shops and stalls was liable to be taxed under Section 10 of the Income-tax Act as income from business or as income from property under Section 9 of the Act. It was held that the income was received from property and tell under Section 9, and that the character of the income was not altered merely because some stalls were occupied by the same occupants and the remaining stalls were occupied by a shifting class of occupants, or from the fact that the company was required to obtain a licence from the Calcutta Municipality to maintain sanitary and other facilities and for that purpose it had to maintain a staff and to incur expenditure. It was held that the primary source of income from the stalls was the occupation of the stalls, and it was a matter of little moment that me occupation which was the source of the income was temporary. In this case also the tenants of the shops and stalls had the advantage of the sanitary and other services which had been provided by the company. These services, however, were regarded as incidental to the letting out of the property and not sufficient to convert the nature of operations of the company into those of a trader as distinguished from the operations of a landowner. 6. The two latter cases referred to by Mr. These services, however, were regarded as incidental to the letting out of the property and not sufficient to convert the nature of operations of the company into those of a trader as distinguished from the operations of a landowner. 6. The two latter cases referred to by Mr. Joshi 1929-15 Tax Cas 266 and 1961-42 ITR 49 (SC) would lead to the proposition that not only when the letting is of the bare tenement but also where the letting is along with certain other services and facilities, that the income will be regarded as income derived from the ownership of property and hence income from the property if the additional services or facilities rendered to the tenants are of a minor character or such as may be regarded as ordinarily provided by a private landlord to his tenants. 7. Mr. Palkhiwala, on the other hand, has contended that there are cases which show that where the letting is not of bare tenements but is of a complex nature and consists of providing specialised devices and facilities and also affording specialised services, the income received is regarded as income from a business operation or enterprise and not income from property. He has in that connection relied on the House of Lords case in Governors of the Rotunda Hospital, Dublin v. Coman, (1918) 7 Tax Cas 617/. The facts of the case were: The Governors of a maternity hospital established for charitable purposes by Royal Chatter in 1753, were the owners of a building which comprised rooms adopted for public entertainments, and which was connected with the hospital buildings proper by an internal passage. These rooms were let out by the hospital for public entertainments, concerts, etc. for periods varying from one night to six months and the income received from such letting was applied to the general maintenance of the hospital. The terms on which the letting was made included the provision of facilities like sealing, heating and attendance but an additional charge was levied for gas and electricity supplied. The question arise whether the profits derived from the letting of the rooms were assessable to income-tax under. Schedule D as income from business or whether it fell outside the said Schedule being income from properly. It was held that the profits derived from the letting of the rooms were assessable under Schedule D as profits of a trade or Business. Schedule D as income from business or whether it fell outside the said Schedule being income from properly. It was held that the profits derived from the letting of the rooms were assessable under Schedule D as profits of a trade or Business. It was contended on behalf of the Revenue that the Governors of Rotunda Hospital were retaining control of the premises, selected the persons to whom the user was granted and regulated the conduct and behaviour of the persons allowed to resort thereto, and, for the purpose of enabling or facilitating the making of contract for such user, they had properly fitted up the rooms with fixtures, fittings and other things and had provided attendance and other services. Such utilisation of property, It was claimed, went far beyond the scope of Schedule A, This contention of the Revenue was accepted by the House of Lords and the Lord Chancellor in his speech observed: "When the facts set out in the case stated and the documents annexed to it are considered as a whole, it becomes plain that the Respondents, with the laudable object of raising an income for the support of their charitable activities, have engaged in what can only be described as business or a concern in the nature, of business, and thereby have earned annual profits." Viscount Finlay pointed out that the profits were derived not merely from the letting of the tenements but from its being let properly equipped for entertainments with seats, lighting, heating and attendance. The subject which was hired out was a complex one and the mere tenement as it stood without the furniture, fixtures, etc. would have been almost useless for entertainment. The business of the Governors in respect of those entertainments was to have the hall properly fitted and prepared for being hired out for such uses. The profits, therefore, fell under Schedule D and rot under Schedule A. 8. Mr. Palkhiwalas submission is that the case before us is a case, which does not fall in the category of the case dealt with in (1929) 15 Tax Cas 266. The income derived in the present case is not from mere letting cut of the tenement but from the complex operations, which were in the nature of trade or business embarked upon by the assesses. Mr. The income derived in the present case is not from mere letting cut of the tenement but from the complex operations, which were in the nature of trade or business embarked upon by the assesses. Mr. Palkhiwala has argued that the mere circumstance that the property has been let out or given for use 2nd occupation by the assessee is not sufficient to make the income received by the assessee in all cases the income from property. He has submitted as observed by Lord Macmillan in 1929-15 Tax Cas 266 that the income from property which is taxable under, and only under, Schedule A, is income derived from the exercise of property rights properly so-called. If the income derived is not from the exercise of property rights properly so-called, out from a complex letting or hiring as in 1918-7 Tax Cas 517, the income derived does not fall under Section 9 as income from property but would appropriately fall under Section 10 of the Income-tax Act as income from business, for his submission that in every case where there is a letting out the income does not necessarily come under the head "income from property", Mr. Palkhivala has invited our attention to two more cases. The first of these is Jamshedpur Engineering and Machine Manufacturing Co. Ltd. v. Commr., Income-tax B and O, 1957-32 ITR 41. In that case the assessee-company, which was carrying on business of manufacturing and selling agricultural implements, had constructed residential quarters for its employees and let out the quarters to its employees, as incidental to its main, business. The company incurred expenditure for repairs and maintenance of the residential quarters. The question arose as to whether the income received by the Company by way of rents from the employees fell under Section 9 of the Income-tax Act as income from property. It was held that the letting out of residential quarters as subservient to and incidental to the main business and Section 9 of the Act did not supply the same is the view taken in Rohtas Industries Ltd. Ulmla-nagar v. Commissioner of Income-tax, B. and Q., 1961-41 ITR 524. The assessee company in that case carried on the business of manufacture and sale of cement, sugar, paper, pulp and certain chemical products. The assessee company in that case carried on the business of manufacture and sale of cement, sugar, paper, pulp and certain chemical products. It owned certain buildings and residential quarters around its factory most of which it let out to its employees and some to outsiders. It was held that the letting out was subservient to and incidental to the main business of the assessee and the exception to Section 9(1) of the Indian Income-tax Act applied. The rent received by the assessee for the letting cut of the quarters to its employees was assessable not under Section 9 but under Section 10 of the Act. 9. From the several cases, which have been cited on either side, the following conclusions appear to follow: 1. Income-tax is a single tax levied on the total income classified and chargeable under the various heads and not an aggregate of the distinct taxes levied separately on each head of income. 2. That the heads of income in Section 6 of the Act are specific heads, which are exclusive and exhaustive. 3. The income which falls under any of these specific heads has got to be computed under that head only in the manner specified in the following Sections 7 to 12. 4. If the income falls under the head "income from property", which is chargeable under Section 9, it his to be taxed under Section 9 only and cannot be taken to Section 10 on the ground that the business of the assessee was to exploit property and earn income or because the income was obtained by a trading concern in the course of its business. 5. House-owning, however profitable, cannot be a business or trade under the Income-tax Act. Where income is derived from house property by the exercise of property rights properly so-called, the income falls under the head Income from property chargeable under Section 9. It is the nature of the operations and not the capacity of the owner that must determine whether the income Is from property or from trade. Where income is derived from house property by the exercise of property rights properly so-called, the income falls under the head Income from property chargeable under Section 9. It is the nature of the operations and not the capacity of the owner that must determine whether the income Is from property or from trade. Where the operations involved in the activity of earning income from house property are not different from those of an ordinary house-owner turning to profitable account the properly of which he is the owner, the income derived is income from property chargeable under Section 9 irrespective of whether the operations are earned by a company one of whose objects or even the sole object is to indulge in the activity of earning income from house property. Thus, where house property is given on lease or licence basis for earning income therefrom, the true character of the income derived is income from property falling under Section 9. The said character is not changed and the income aces not become income from trade or business lf the luring is inclusive of certain additional services such as heating, cleaning, lighting or sanitation, which are relatively insignificant and only incidental to the use and occupation of the tenements. 6. In cases where the income received is not from the bare letting of the tenement or from the letting accompanied by incidental services or facilities, but the subject hired out is a complex one and the income obtained is not so much because of the bare letting of the tenement but because of the facilities and services rendered, the operations involved in such letting of the property may be of the nature of business or trading operations and the income derived may be income nut from exercise of property rights properly so called so as to fall under Section 9 but income from operations of a tracing nature falling under Section 10 of the Act, and 7. In cases where the letting is only incidental and subservient to the main business of the assessee, me income derived from the letting will not be the income from property falling under Section 9 and the exception to Section 9 may also come into operation in such cases. 10. It is in the light of these principles that the question before us in the present case will have to be examined and decided. 11. 10. It is in the light of these principles that the question before us in the present case will have to be examined and decided. 11. Now, in the present case, the company has been formed with the object of carrying on the business or storing and preserving films and other articles of cinema industry, and generally to carry on all sorts of business of safe deposit vaults in all its aspects. Under the Cinematograph, Film Rules, 1948, a person desiring to Store films has to obtain a licence and under the terms of me licence he has to store films exceeding 1000 Ibs. in a vault built according to certain specifications and he has also to observe certain other precautions and conditions in the matter of storage of films. The vaults, besides, have to be constructed at an approved place. The vault under the said Rules has been defined as "any premises constructed and equipped in accordance with the requirements of these rules for the storage of films in quantity exceeding 1000 Ibs." The specifications for the vault relate to its dimensions, walls, floors, roof, exits and ventilations. The company purchased a plot of land at Mahim and built 13 units containing vaults, which were constructed and equipped in accordance with the said Rules. After Having constructed the vaults, it entered into agreements with persons, who wanted to store their films in the vaults. Under these agreements, which were called Licences, use of the vaults was permitted to the vault-holders on their Paying a certain monthly charge. These licences were given for a period of five years, but the said period was subject to termination and extension as provided in the other terms of the agreement. The payment to be made in respect of the vault was termed as compensation for the vault. The use of the vault was permitted only for storing of films and for no other purpose, and the corresponding ground floor attached to the vault was to be used for operations connected with repairings, cleaning, waxing and rewinding of the films only. The licencee was to permit the Officers and Agents of the company, Government Municipality, Police or other public servants authorised to enter the premises with or without workmen for the purpose of inspecting and viewing the state and condition thereof. The licencee was to permit the Officers and Agents of the company, Government Municipality, Police or other public servants authorised to enter the premises with or without workmen for the purpose of inspecting and viewing the state and condition thereof. The licences was not to transfer, assign or sub-Iet his right to the user of the vault except with a written permission of the company. At the end of the period, the licencee was to yield up to the company the licenced premises. The company under the terms of the licence had a right by giving two days notice to the licencee to allocate alternative space for storing his cinema films. The licence also provided: "Nothing herein contained shall be construed to create any right (other than the revocable permission granted by the company) in favour of the Licencee of the licensee vault nor as conferring any right to quiet enjoyment to other right except so far as the Company has power to grant the same and the Company may of its mere motion and absolutely retain possession of the licenced vault with all additions fittings and fixtures thereto." It is found on facts that the company was rendering other services to the vault-holders. It had installed a fire-alarm and was incurring expenditure for the maintenance of the fire-alarm by paying fire-service charges to the Municipality. It had opened in the premises two railway booking offices free of charge for dispatch and receipt of film parcels. The company had also maintained a regular staff consisting of a Secretary, a peon and a watchman and a sweeper and it was also paying for the entire staff of the Indian Motion Pictures Distributors Association an amount of Rs. 800/- per month for services rendered to the licence-holders. The licence-holder was given the key of the vault, but the key to the entrance which permitted access to the vaults was kept in the exclusive possession of the company. 12. Now, the units constructed by the company were having regard to their location and construction only suitable for the specific purpose of storage of films. The construction in order to be suitable for this purpose had not only to be built according to the specifications but had to be also further fitted with other devices such as automatic fire-proof doors, which will close immediately on the outbreak of fire in the vault, etc. The construction in order to be suitable for this purpose had not only to be built according to the specifications but had to be also further fitted with other devices such as automatic fire-proof doors, which will close immediately on the outbreak of fire in the vault, etc. In order to facilitate the business of storage of films the company had provided other facilities and conveniences such as booking offences opened by it, and the canteen, etc. In order further to see that the storage of films by the licence-holders in the vaults belonging to the company was properly carried on according to the rules and regulations, the company had maintained a staff. It was also paying for services rendered for maintaining the vaults in proper condition and for securing that all the several devices and mechanised constructions which had been installed were properly maintained. The charges of Rs. 40/- per month from certain licence-holders, Rs. 140/- per month and Rs. 300/- or Rs. 100/-from others were charges obtained by the company not merely for the bare use of the vaults but for the use or the vaults as well as for the several services and conveniences afforded to the vault-holders. To use the words employed by Viscount Finlay in the Rotunda Hospital case, 1918-7 Tax Cas 517 "the subject which was hired out was a complex one" and the mere tenement as it stood without the special devices and services was almost useless for the purpose for which It was required. The charges, which the company was receiving, therefore, were not the income from the exercise of property rights properly so called but was the income derived from the enterprise which it was carrying on of providing facilities for the storage of films to the licencees. This activity of the company, in our opinion, was in the nature of a business activity and the providing of vaults to the persons who wanted to store their films was a part of the business enterprise or operation, which was carried on by the company. Where house property is turned to profitable account by letting or hiring the tenements with or without such other relatively insignificant or minor services, which are ordinarily incidental to the letting or hiring, the income from the house property would be income chargeable under Section 9. Where house property is turned to profitable account by letting or hiring the tenements with or without such other relatively insignificant or minor services, which are ordinarily incidental to the letting or hiring, the income from the house property would be income chargeable under Section 9. This would be clear when we consider the nature or deductions, which are permitted from the gross income under that section. The income, which is obtained by the company in the present case, required considerable expenditure to be incurred by the company, which is ordinarily not incurred by a landlord who turns his house property to profitable account and which is also not taken into account in the deductions permissible under Section 9. in our opinion, therefore, the income, which the company obtained from the licence-holders in the present case, could not be regarded as income from property falling under S. 9 of the Indian Income-tax Act. The activity ct the company in earning that income was a business activity and the source of the income, which me company obtained from the licence-holders, was not the ownership of the house property but its business. 13. Mr. Palkhivala has argued in the alternative that on the facts of the present case, the company could be said to have been in occupation of the said property for the purpose of its business, and therefore, the exception to Section 9 will also apply in the present case. He has pointed out that the licence in the present case merely permitted the use of the vault to the vault-holder for the purpose of safely depositing his films and by granting such licences the company was carrying on the business of safe storage of films in the premises which it had constructed and equipped and maintained for the purpose. Although the key of the vault was given to the vault-holder, the hey to the entrance, which permitted access to the vaults, was kept in the exclusive possession of the company. There was, therefore, no possession of the premises at any time given by the company to the licence-holders: all that they were given was the key to the vault, which gave access to the vault and to make use of the same. According to Mr. There was, therefore, no possession of the premises at any time given by the company to the licence-holders: all that they were given was the key to the vault, which gave access to the vault and to make use of the same. According to Mr. Palkhivala, the company itself was carrying on the business of safe storage of films in the premises by affording facilities to person who wanted to store the films, to make use of the vaults, which it had specially constructed, equipped and maintained for that purpose and the business of the company, therefore, was undis-tinguishable from that of banks which provide safe deposit vaults. In our opinion, there is considerable force in this submission of Mr. Palkhivala also and the house property including the vaults, which were used by the vault-holders under their licences, could be said to have been in the possession of the company in the course of its business. On the facts of the present case, it is possible to hold that the company was in occupation of the premises for the purpose of its business which consisted of safe storage of films by permitting use of the vaults and attoroing facilities for the safe storage of films and the income, which the company derived therefrom was income received by the company from and In the course of Its business. In our opinion, therefore, the income in the present case was income, which properly fell under Section 10 and was not income from property falling under Section 9 of the Act. 14. Our answer, therefore, to the first question is in the affirmative. 15. In view of our answer to the first question, second question does not survive. The assessee will get its costs from the Department. 16. Answer for assessee.