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2012 (5) TMI 705 - AT - Income TaxDetermination of Annual Letting Value (ALV) - Held that:- It becomes apparent that the rateable value of the property in the instant case be considered for determining the ALV of the property, as has been accepted by the AO himself in the succeeding year. The further contention raised by the assessee that deduction should be allowed towards municipal taxes is not acceptable in view of the reason that such taxes were paid by the tenant and not the assessee. We, therefore, modify the impugned order to this extent. Determination of ALV - Held that:- For the immediately preceding assessment year 2004-05 we have held that the ALV of the property be taken at ₹ 11,13,700/- without deduction of any municipal taxes which were borne by the tenant and not the assessee. In this view of the matter, the impugned order is upheld and the ground raised by the assessee is dismissed. Denial of deduction towards education cess - Held that:- Education cess is nothing but additional surcharge. Since such surcharge or education cess is part of tax, the same, in our considered opinion, cannot be allowed as deduction. Such amount clearly constitutes part of tax which falls within sec. 40(a)(ii). We, therefore, uphold the impugned order on this score. Disallowance u/s.14A - Held that:- We are unable to find any reason for interfering with the impugned order on this issue because the ld. CIT(A) has directed the AO to follow the mandate of the judgment of the Hon’ble jurisdictional High Court in the case of Godrej & Boyce Mfg. Co. Ltd. (2010 (8) TMI 77 - BOMBAY HIGH COURT ) on some reasonable basis. We uphold the impugned order but clarify that in no case the disallowance to be made by the AO pursuant to the order of ld. CIT(A) should exceed the original disallowance made by him. This ground is, therefore, disposed of accordingly.
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