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2016 (4) TMI 1164 - ITAT CHENNAI

2016 (4) TMI 1164 - ITAT CHENNAI - TMI - Rental value computation - reference to DVO - Held that:- Assessing Officer is expected to compute the annual rental value of the property on the basis of the method provided in the Tamil Nadu Buildings (Lease & Rent Control) Act, 1960. Since the provisions of Tamil Nadu Buildings (Lease & Rent Control) Act, 1960 was not taken into consideration and the Commissioner enhanced the rent at the rate of 25% per annum, this Tribunal is of the considered opinion .....

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of the Assessing Officer. - Decided in favour of assessee for statistical purposes. - ITA Nos.139, 140, 141 & 142/Mds/2016 - Dated:- 22-4-2016 - SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER Appellant by : Sh. R. Vijayaraghavan, Advocate Respondent by : Sh. A.B. Koli, JCIT O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: All the appeals of the assessee are directed against the respective orders of the Commissioner of Income Tax (Appeals) - 8, Chennai, dated .....

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rental income declared by the assessee at ₹ 90,000/-. The Assessing Officer estimated the rental value at ₹ 12,00,000/- per annum after increasing the same at the rate of 25% per annum. According to the Ld. counsel, increasing the rental value at 25% is abnormal. It cannot be anybody s imagination that the rental value is increased at the rate of 25% per annum. The CIT(Appeals) estimated the rental income at ₹ 3,00,000/- per annum. According to the Ld. counsel, at the best, th .....

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appellate Commissioner estimated the rental income at ₹ 3,00,000/- per annum. Similarly, for assessment year 2004-05, the appellate Commissioner estimated the rental income at ₹ 4,68,750/-. For the assessment year 2005-06, by adopting 25% increase per annum, the rental income was worked out to ₹ 5,85,938/- per annum. Similarly for the assessment year 2006-07, the rental income was estimated by appellate Commissioner at ₹ 7,32,422/- per annum. Since the house property was .....

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wner in respect thereof. In the case before us, a property was let out to a holding company, namely, M/s Data Software Research Company Pvt. Ltd. Since the property was let out to a holding company, the authorities below increased the rent received by 25% per annum. This Tribunal is of the considered opinion that increasing the value at the rate of 25% per annum is highly arbitrary. The rental value cannot increase at the rate of 25% year to year. 5. The rental value would depend upon the demand .....

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The built-up area appears to be 2584 sq.ft. It is not known whether any land appurtenant to the building is available or not. The Assessing Officer apparently computed the rental value on the basis of Inspector s report and the Municipal value. The building is admittedly in the city of Chennai and it is governed by Tamil Nadu Rent Control Act. Tamil Nadu Rent Control Act provides for method of calculation of rental value. Therefore, the Assessing Officer is expected to compute the annual rental .....

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