9911796707
TMI Blog2003 (4) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... wife and daughter of karta of the assessee Hindu undivided family and a trusted employee of the kartha as partners, under which the entire building was leased out to the firm on a monthly rent of Rs. 6,250. The firm, in turn, entered into several agreements of lease with different tenants in respect of several portions of the building. The building was occupied immediately after its completion by such tenants. A lease deed dated December 9, 1982, was entered into between the firm and Indian Bank which is on record. That lease deed shows that the tenant had to occupy the portion that was leased out on December 11, 1981, within three months from the date of completion of construction of the building. The rental received by that firm from its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer was affirmed by the Commissioner and the assessee was unsuccessful in persuading the Tribunal to reverse the order of the Commissioner. Learned counsel for the assessee submitted that under section 23(1)(b) of the Act, it is only the rent actually received by the owner that is relevant and the Tribunal was in error in considering the actual rent received by the assessee's lessee, namely, the firm, Lakshmi & Co. This submission is misconceived. Section 23(1)(b) of the Act is applicable only to cases where the actual rent received is in excess of the sum which can reasonably be expected to be received from letting out the property from year to year. As to what is the amount that can be reasonably expected to be received from letting ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al, the burden is on the Revenue to establish the same. Learned counsel also relied on the following decisions: The case of CIT v. M. Ratanchand Chordia [1997] 228 ITR 626 (Mad), wherein it was held that the annual value has to be determined on the basis of the actual rent, as there was no evidence in that case to show that the rent received was low because of any extraneous consideration. CIT v. Parasmal Chordia [1998] 233 ITR 147 (Mad), it was held that the standard rent has to be taken as assessable value. In the case of T.V. Sundaram Iyengar and Sons Ltd. v. CIT [2000] 241 ITR 420 (Mad), wherein the court upheld an order of remand made by the Tribunal to ascertain the reasonable rent as it had been found that the letting was to an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and no more. When the documents placed before the Assessing Officer clearly showed that the letting effected by the assessee was to a firm of which his wife and daughter were partners that letting was rightly not regarded by the Assessing Officer as a reliable record for determining the reasonable rent. What is required to be ascertained for the purpose of determining the annual value as provided in section 23(1)(a) of the Act is the sum for which the property might "reasonably be expected to be let" from year to year. In this case, the rent realised by the firm from the tenants was a figure which could, and has rightly been adopted by the Assessing Officer as the sum daughter which the property could reasonably be expected to be let from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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