Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (4) TMI 804 - ITAT SURATIncome from house property - Vacancy allowance - deemed income / fictitious income - Computing notional rent u/s 23(l)(a) as against the income declared by the Appellant in the return of income - HELD THAT:- As per the terms and conditions of the agreement, by which the lessee may terminate the said agreement anytime during the currency of the said agreement by giving a prior written notice of three months (3 months). Accordingly, the lessee bank has given 3 months’ notice on 18.01.2016 to the assessee, to terminate the agreement with effect from 18.04.2016. Therefore, during the financial year 2016-17, the assessee has received 18 days rent from 01.04.2016 to 18.04.2016, which the assessee has offered for tax in the relevant AY.2017-18. After 18.04.2016 the property was vacant, as the assessee could not get any customer to let out the property. We note that on rental income TDS has been deducted by the ICICI Bank during the current year. ICICI Bank has issued a letter to the assessee, which shows that the lease agreement has been terminated by the ICICI Bank on 18.04.2016. Based on this factual position, the assessee has received the rental as rent income only for eighteen days in the AY.2017-18 which has already been offered for tax on which TDS has also been deducted. Therefore, since the assessee has not received rental income from 19.04.2016 to 31.03.2017, hence, hypothetical rent should not be taxed in the hands of the assessee. Therefore, we note that assessee has disclosed the actual rent received by him, therefore fictitious rental income should not be taxable in the hands of the assessee. Neither the AO nor before the Ld. CIT(A) has demonstrated with cogent evidences that assessee has let out the property for the remaining period from 19.04.2016 to 31.03.2017. Therefore the notional rental income assessed by the AO should be deleted - Appeal filed by the assessee is allowed.
|