TMI Blog2020 (8) TMI 308X X X X Extracts X X X X X X X X Extracts X X X X ..... 23. The assessee has given a concession in rent to its tenant on the basis of some hard facts. It has been brought to my notice that this project never materialized, and M/s.Bharti Wallmart Pvt.Ltd. could not open the business centre. Inspite of that, they have paid rent for five years on the basis of this agreement. We could appreciate the case of the AO, if he has made reference to the rent deed of adjoining properties and pointed out that this leased property could be fetch this much rent, and therefore, the annual letting value of the assessee s house property is to be determined equivalent to the amount on which original rent fixed between the assessee and BWP. After going through all the details no addition is required to be ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of the assessee was selected for scrutiny assessment and notice under section 143(2) of the Act was issued on the assessee company, which was duly served. Assessee company is engaged in the business of real estate development, and having a property situated at Karamsad, R.S.No.385/2/B, 385/5, 385/4/P, 385/3 KHA TA No.385, Anand. During the assessment proceedings, the ld.AO noticed that the assessee has rented out this property to M/s.Bharati Wallmart Ltd. (BWL), and offered rental income of ₹ 18,95,226/- in the return of income from this property. The AO called for rent agreement entered into between the assessee and BWL, and on perusal of the same, it was noticed by the AO that, the agreement was executed on 5.11.2012 and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng out of the property to BWL, what overweighed to persuade them is that, the date of agreement was not mentioned in the Addendum Lease agreement, and the signature of BWL was not put in the agreement. It is clearly stipulated in the agreement that the terms of agreement shall be applicable from the beginning of the rent commencement date, and accordingly, the terms of Addendum agreement is to be considered as applicable from the date of original agreement, and therefore, no adverse inference can be drawn on the ground that the date of agreement was not mentioned in the deed. It is further submitted that situation of the lease property and the factors hindering the property in fetch higher rental income has not been doubted by the Revenue a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 23 which is deeming section and states that for the purpose of section 22 the annual value of any property shall be deemed to be the sum for which the property might reasonably be expected to let from year to year. In this context, it is not the actual rent received but the annual value of the property is to be charged u/s.22 of the I.T.Act, 1961. In the present case, annual value of property as signed in the original agreement is ₹ 1,63,20,000/- (i.e. @ ₹ 13,60,000/- x 12). The appellant has subsequently granted discount @ 40%. There is no evidence field by the appellant that lettable value of the property has been reduced by 40%. Considering the above facts, annual value of property as determined by AO @ ₹ 13,60,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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