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Monisha R Jaising Versus Dy. Commissioner of Income Tax, Central-Circle-24 and 26, Mumbai

2017 (9) TMI 1146 - ITAT MUMBAI

Addition u/s 23(1)(a) - deemed rent - vacant property / vacancy allowance - 3 properties not offered for tax under the head House properties - AR submitted that out of two flats treated as deemed let out, the flat no.2B was let out in 2003 but vacant since then and therefore the provisions of 23(1)(c) - Held that:- We find merit in the contention of the ld.AR that once the property is let out and at any point of time this remained vacant during the same cannot be brought to tax resorting to prov .....

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expenses - Held that:- We find that the ld.CIT(A) has passed a very reasoned order by upholding the disallowance at 10% of the total expenses on the basis of the decision in assessee’s own case in the assessment year 2006-07(supra). Since, the assessee has not furnished any details of expenses during the course of assessment proceedings before the AO or the CIT(A) and therefore the AO is not in a position to verify the expenses. Accordingly, we are inclined to uphold the order of the ld. CIT(A) .....

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ese appeals were clubbed together, heard together and are being dispose off by this common order. 2. Grounds of appeal no.1,3 and 4 are not pressed at the time of hearing, hence dismissed as not pressed. 3. The issue raised in the grounds of appeal no.2 is against the confirmation of addition by CIT(A) as made by the AO u/s 23(1)(a) of the Act ₹ 2,14,665/-. 4. The facts in brief are that during the course of assessment proceedings, the AO noticed that the assessee has three registered prop .....

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77; 35,69,278/- and ₹ 2,64,018/- respectively aggregating to ₹ 38,33,296/-. In the appellate proceedings, the ld.CIT(A) dismissed the appeals of the assessee by observing and holding as under : 5.3 I have considered the facts of the case, the assessment order and the submissions made by the appellant. The fact that the appellant was owner of the properties is not in dispute. The flats were vacant. The question to be considered is whether the annual value of the flats which was vacant .....

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remsudha Exports P Ltd (110 ITD 158 Mum). In this regard it hasa to be stated that the Andhra Pradesh High Court has taken a contrary view in the case of Vivek Jain vs. ACIT (337 ITR 74 [AP]). The Andhra Pradesh High Court has observed that the provisions of Sec. 23(1)(c) are attracted if i) property or any part thereof has been let; ii) it has been vacant during the whole or any part of the previous year and iii) owing to such vacancy the actual rent received or receivable is less than the sum .....

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therefore the provisions of 23(1) (c) of the Act should not be invoked. In respect the flat at Peace heaven, the assessee contended that the same could be assessed and brought to tax by resorting the provisions of section 23(1)( c) of the Act. The ld. AR, in defence of his argument relied on the decision of the Co-ordinate Bench of the Tribunal in the case of Informed Technologies India Ltd V/s DCIT (2016) 75 taxmann.com 128 (Mum-Trib) and Premsudha Exports (P) Ltd V/s ACIT (2008) 110 ITD 158 ( .....

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int of time this remained vacant during the same cannot be brought to tax resorting to provisions of section 23(1)( c ) of the Act. The issue in the case of assessee is supported by the various decisions referred to and relied upon by the ld.AR in the case of Informed Technologies India Ltd (supra). The co-ordinate bench of the Tribunal in the said order has held as under : The issue under consideration for adjudication is as to whether the 'ALV' of the property owned by the assessee had .....

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ords 'Property is let' used in clause (c) of section 23(1), unlike the term 'house is actually let' as stands gathered from a conjoint reading of sub-sections (2) to (4) of section 23, it can safely and inescapably be gathered that the conscious, purposive and intentional usage of the aforesaid term 'Property is let' in section 23(1)(c), cannot be substituted by the term 'house is actually let' as used by the legislature in all its wisdom in sub-section (3) of sec .....

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g out. The usage of the term 'Property is let' in section 23(1)(c) had purposively been used to exclude those properties from the ambit of the clause which are held by the owner for self occupation purposes, because even though the 'ALV' of one self occupied property so chosen by the assessee is taken at Nil, however the 'ALV' of all the remaining self occupied properties are to be determined in terms of section 23(1)(a). Thus the term 'Property is let' used in se .....

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would continue to be determined under section 23(1)(c). Thus the assessee in the present case had rightly determined the 'ALV' of the property at Rs. Nil by taking recourse to section 23(1)(c). [Para 7.1] In light of aforesaid observations the ground of appeal of the assessee is allowed and the addition made by the Assessing Officer and as such sustained by the Commissioner (Appeals) is vacated. [Para 7.2] We therefore respectfully following the ratio laid down by the co-ordinate bench o .....

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it and loss account an amount of ₹ 2,50,428/- and ₹ 1,61,361/- towards vehicle expenses and telephone expenses respectively. The AO called for the details of these expenses during the course of assessment proceedings, when the assessee failed to furnish the details, the AO estimated the disallowance towards the personal element in the said expenses at the rate of 10% thereby added a sum of ₹ 41,179/- to the total income of the assessee. In the appellate proceedings, the ld. CIT .....

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