TMI Blog2005 (3) TMI 707X X X X Extracts X X X X X X X X Extracts X X X X ..... s is reproduced below : "On the facts and in the circumstances of the case, the learned CIT(A) erred in holding that the rent collected by the assessee for the properties let out by it should be adopted as the Annual Letting Value for the purpose of computing the income from house property, whereas the rent paid by the ultimate user to whom these properties had been sublet, had been correctly adopted as the Annual Letting Value by the Assessing Officer as per the provisions of section 23(1)." 3. Shri J.D. Mistry, the learned counsel appearing for the Respondent-assessees has made his preliminary submission that the ground raised by the revenue in these appeals has been considered by various Benches of ITAT Mumbai in a quite number of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dance with the standard rent and the principles relating to the fixation of the standard rent have been laid down by the Supreme Court in the three decisions cited above ( Diwan Daulat Rai Kapoor 122 ITR 700; Sheila Kaushis 131 ITR 435; and Dr. Balbir Singh 152 ITR 388). In the absence of the figure relating to the fair rental value, what can be assessed in the assessee s hands is only the actual rent received or receivable by it. What the departmental authorities have done is to include the rent received by the assessee s tenants from the bank in the assessee s hands. This cannot be done under section 23(1)( b ) because what the assessee s tenants have received is not what the assessee has received from the Bank." 5. In the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ] 266 ITR 277. In the said case, the assessee who was owning a building which was constructed in 1981 was leased out to another firm, immediately after completion of the construction. The lessee firm composed of wife and daughter of Karta of the HUF and a trusted employee of the HUF. The assessee let out the property for a rent of Rs. 6,250 per month whereas the lessee firm later on sublet the property to the bank for a higher amount. The said higher amount was adopted by the assessing authority in computing the property income of the assessee. While disposing the matter, the High Court held that with the documents placed before the assessing authority clearly showed that the letting effected by the assessee was to a firm of which his wife ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on the basis of the rent received by the original landlord on the ground that the letting and sub-letting activity have not been proved to be result of collusion between the concerned parties. The learned D.R. submitted, therefore, that atleast these appeals may be sent back to the assessing authority to rule out any case of collusion so that the decisions taken by the Mumbai Benches of the Tribunal may be applied on a correct and proper factual matrix. 8. We considered the rival contentions in detail. It is true that the Hon ble Madras High Court in the case of N. Nataraj ( supra ) has held that the rent received by the lessee on sub-leasing should be taken as the fair rent in the hands of the original landlord. The High Court arr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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