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2021 (1) TMI 948 - AT - Income TaxIncome from house property - ALV determination - AO estimated rental income @8% of value of the property - assessee has offered the deemed rental value on the basis of Municipal Valuation and property has not been let out, at all, during the year - HELD THAT:- As per the provisions of Sec. 23(1)(a), the annual value of such property shall be deemed to the sum for which the property might reasonably be expected to be let out from year to year In the case of CIT V/s. Tip Top Typography [2014 (8) TMI 356 - BOMBAY HIGH COURT] concurred with following principles laid down by full bench of Hon'ble Delhi High Court in the case of CIT V/s. Moni Kumar Subba [2014 (8) TMI 356 - BOMBAY HIGH COURT] and held Annual Letting Value (ALV) of the property could not exceed Standard Rent as per the Rent Control Legislation as applicable to the property and the Standard Rent is the upper limit. ALV of the property has to be determined at sum at which property might reasonably be let out between willing parties. Methodology as adopted by Ld. AO to estimate the income @8% of value of the property is not in accordance with the above principles laid down by Hon'ble Court and therefore, the same could not be sustained. Nothing has been brought on record by Ld. AO that the aforesaid estimation was the approximate sum between willing parties. The assessee offered the rent on the basis of Municipal Valuation which is in accordance with the principle laid down by Hon'ble Court as above. Therefore, the estimation thus made and confirmed by lower authorities could not be sustained. We direct Ld. AO to adopt the ALV of the property at ₹ 8,400/-, being deemed rental value based on municipal valuation of the property - Decided in favour of assessee.
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