TMI Blog1991 (8) TMI 75X X X X Extracts X X X X X X X X Extracts X X X X ..... nasmuch as, in the opinion of the Commissioner, the annual letting value ought to have been taken on the basis of the value of the property disclosed by the assessee in his wealth-tax return. It appears that, for the purpose of wealth-tax, the value of the property disclosed was Rs. 1,90,800. Therefore, according to the Commissioner, the annual letting value of the property, for the purpose of income-tax, ought to have been adopted at Rs. 9,540 as against Rs. 2,500 adopted by the Income-tax Officer in his assessment order. As the Income-tax Officer had failed to adopt the correct value of the property which was in the occupation of the assessee, in the opinion of the Commissioner, the assessment made by the Income-tax Officer was erroneous ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contention that the annual letting value of the self-occupied property, for the purpose of income-tax, ought to be determined on the basis of the value disclosed in the wealth-tax return. The Tribunal observed that it was not disputed before it that the rental income, in the assessment year under reference, was determined on the basis of the actual cost as in the earlier years. The property occupied by the assessee was constructed in the year 1930 and there was no material to indicate that there was any alteration or renovation made in the property so as to increase the capital value of the property. It was further observed that, had the property been let out in the year of occupation by the assessee, the rent would have been the subject-ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 263 of the Income-tax Act, 1961 ?" In Sakarlal Balabhai v. ITO [1975] 100 ITR 97, this court held that the rate of interest on the cost of the building and land may provide reasonable basis for determining the annual letting value of the property, more particularly, when the property is occupied by the owner. In the instant case, it is not disputed that, as in the past years, the Income-tax Officer had adopted the figure of annual letting value at Rs. 2,500 on the basis of net return calculated on the cost of the property. It thus appeared that the basis for working out the annual letting value of the property occupied by the assessee is, as held by this court, reasonable. Rent control law is in force in Gujarat and this law provides fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hetical tenant could not possibly exceed the standard rent determinable in accordance with the provisions laid down in the Rent Control Act. The standard rent determinable on the principles laid down in the Rent Control Act was laid down by the court as the upper limit of the rent which the landlord may expect to receive from a hypothetical tenant if the building were let out to him from year to year. The court did not hold that, even if the actual rent receivable by the landlord from the tenant or the rent which the owner may reasonably expect to receive from a hypothetical tenant were lower than the standard rent determinable in accordance with the principles laid down in the Rent Control Act, the standard rent must still be taken to be t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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