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TMI Blog2012 (8) TMI 179X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances of the case, the CIT(A) has erred in law and on facts in deleting the addition of Rs. 15,00,000/- made by the Assessing Officer on the Annual Letting Value on account of notional interest on interest free security received by the assessee?" 3. The common issue involved in these appeals relates to deleting the addition of Rs. 15 lacs made by the AO on the Annual Letting Value being notional interest on interest free security received by both the assessees. The facts of the case stated in brief are that Mrs. Uma Beriwala and her husband Shri Vinit Beriwala having 50% share each let out property No. 19/6, K.M. Road, Faridabad on rent @ Rs. 1,15,000/- P.M to M/s. Vipul Motors Ltd. Both the assessees received interest free securit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, but certainly not by considering any notional income being the interest on security deposit received by the owner of the property. The assessee placed reliance on the decision of Hon'ble Delhi High Court in the case of CIT v. Moni Kumar Subba [2011] 333 ITR 38/199 Taxman 301/10 taxmann.com 195 [FB] wherein it has been held that notional rent cannot form part of fair rent u/s 23(1)(a) of the Act. 5. Ld. CIT(A) examined the contention of assessee in the light of provisions of section 23(1)(a) and decision of Hon'ble Delhi High Court in the case of Moni Kumar Subba (supra) and other judicial pronouncements on the issue and came to the conclusion that notional interest on interest free security can not be taken as determinative factor to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dard rent determinable under provisions of rent control law would be annual value even though standard rent has not been determined. Ld. AR of the assessee therefore supported the order of Ld. CIT(A). 7. We have heard both the parties and gone through the material available on record. The assessee Mrs. Uma Beriwala and her husband Shri Vinit Beriwala owned half share of the property which was let out to Vipul Motor on monthly rent of Rs. 1,15,000/-. Both the assessees received interest free security deposits of Rs. 1.25 crore. The AO while determining the income from house property added notional interest @ 12% of interest free security amounting to Rs. 15,00,000/-. Under section 23 (1) annual value of any property shall be deemed to be (a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 23(1)(a) do not mandate this. In a taxing statue, it would unsafe for the court to go beyond the letter of the law and try to read into the provision more than what is already provided for. 8. In the case of assessee, the AO has not attempted to carry out any exercise as to what was the fair market rent. He has simply added 12% of security deposit as notional rent u/s 23(1)(a) of the Act. In the case of Tivoli Investment & Trading Co. (P.) Ltd (supra) the assessee received interest free security deposit at Rs. 1.54 crores. The assessee also received reimbursement of taxes of Rs. 9825/- per month. There was no rent received or receivable by the assessee. The assessee had shown the rent received i.e. maintenance charges received from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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