TMI Blog2011 (4) TMI 1363X X X X Extracts X X X X X X X X Extracts X X X X ..... g interest ofRs.30,000/-. A perusal of the assessment order shows that while computing the income under the head Income from other sources the assessee claimed interest payable ofRs.30,000/- from the interest ofRs.22,392/- received as interest on FD, savings bank interest and interest from ICICI Safety Bonds. The Assessing Officer called upon the assessee to prove the nexus between the expenditure and the income as required under section 57(iii) of the Act. The assessee admitted that he was unable to prove the nexus. The Assessing Officer therefore disallowed the interest claim ofRs.30,000/- and brought the interest ofRs.22,392/- to assessment. The disallowance was upheld in appeal against which the assessee is in further appeal before th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he CIT(A), which has not been disputed by the CIT(A) or before us on behalf of the department, we are of the view that the consistent practice adopted by the department should not be departed from in the absence of any change in the facts or the legal position. We also find that the judgment of the Karnataka High Court (supra) supports the assessee s claim. We accordingly allow the assessee s claim for deduction ofRs.30,000/- as interest. The ground is allowed. 5. The only other ground is as under: - 2. On the facts and in the circumstances of the case, the CIT(A) erred in upholding the action of the AO in determining and adding Annual Rental Value @ 10% of fair market value of the two residential houses under section 23(1)(a) to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment order the Assessing Officer observed that the fair market rent for the flats in Capri and Kodinar and the standard rent should be compared and the higher of the two should be taken as the annual letting value of the flats. In the enclosure to the statement of income the assessee had filed certificates dated 26.08.2005 from the Brihanmumbai Mahanagarpalika showing the rateable value of Kodinar atRs.7,255/- and the rateable value of Capri atRs.3,265/-. It is on the basis of these figures that the annual letting value was offered in the return. The Assessing Officer was however of the view that the Municipal valuation does not reflect the fair market rent of the flats. The assessee would appear to have claimed that he is entitled to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7. On appeal the assessee objected on the ground that the Assessing Officer was not justified in relying on the Times of India report. He further claimed that under section 23(1)(c) the assessee was entitled to compute the income from properties which are vacant during the whole or any part of the previous year on the lesser of the actual rent received or receivable and the sum for which the property might reasonably be expected to let. Accordingly it was claimed that the assessee rightly offered the rateable value of the flats as determined by the Municipal Corporation of Mumbai. Reliance was placed on the decision of the Mumbai Bench of the Tribunal delivered on 31.05.2007 in the case of Premsudha Exports Pvt. Ltd. vs. ACIT in ITA N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bai Bench of the Tribunal in the case of JCIT vs. M/s Shapoorji Co. (Rajkot) Pvt. Ltd. (ITA No: 40/Mum/1999) on 17.09.2003. In this order the Tribunal referred to its earlier order dated 29.07.2003 for the assessment year 1994-95 in that assessee s case and held that in Mumbai it is the annual rateable value as fixed by the Municipal Corporation Act, which is taken as annual value because the same is based on the cost of construction of the building. It was further held that annual Municipal value if available itself could be the annual letting value and if the actual rent received or receivable is more than the annual Municipal value, then the actual rent may be taken as the annual value. This order of the Tribunal has also been affirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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