9911796707
TMI Blog2021 (3) TMI 719X X X X Extracts X X X X X X X X Extracts X X X X ..... record and his action as maintained by the Commissioner of Income Tax (Appeal) ignoring the correct facts is highly unjustified, incorrect and bad both on the facts and in law. 2-That in any view of the matter the addition of Rs. 75,395/-as enhanced/made by the assessing officer under the head rental income as per para 7 of the assessment order and his action as confirmed by the Commissioner of Income Tax (Appeal) is totally incorrect and unwarranted in the facts and circumstances of the case. 3-That in any view of the matter the addition of Rs. 75,395/- on count of rental income as made and maintained by the two lower authorities is incorrect specially when the said rental income paid to the appellant by M/s Kesarwani Hospital & resea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd shareholders. The A.O. further noted that since 1995, there is no increase in the rental income and accordingly, he proceeded to determine the fair market rental value. The Assessing Officer took a comparable instance of a property situated at Lowther Road, Dharbhanga coastal at a distance of 100 yard from the property which is let out to Debt Recovery Tribunal (DRT) for a rent @ 8.78 per sq.ft. The Assessing Officer applied the said rate of rent in the case of the assessee and determined the Annual Letting Value (ALV) of the property in question at Rs. 15,74,184/-. After allowing the deduction u/s 24 (1), the income from house property was computed at Rs. 10,26,029/- the 1/13th share of the assessee comes to Rs. 81,695/- as against Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nnual letting value by adopting the rate in respect of the other building without considering the other factors influencing the rate of rent being the area the timing of the agreement for letting out of the property as well as the difference of the location of two properties. The Ld. AR has submitted that the Assessing Officer has made an addition without determining the fair market rental value of the property in question in terms of the provisions of section 23 (1) of the Income Tax Act. The decision of the Assessing Officer is arbitrary and justified. He has pleaded that the addition made by the Assessing Officer may be deleted. 5. On the other hand, the Ld. DR has submitted that the property has been given to the related party being th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the actual rent received or receivable by the owner in respect thereof is in excess of the sum referred to in clause (a), the amount so received or receivable; or (c) ............................... The ALV of any building is based on what rent it might get not the rent received. The building in question is situated on Lowther Road in Darbhanga Castel area and is having area of 1600sq. yard. The comparable building which is also situated in the Darbhanga Castel area on Panna Lal Road at a distance of 100 yards inside the road and is occupied by Debt Recovery Tribunal (DRT). The DRT is paying rent @ Rs. 8.78/- per sq. ft. Considering all aspect of the case the fair rent of the building in question occupied by Kesarwani Hospital & Res ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessed accordingly at the total income of Rs. 23,22,560/-. Charge interest u/s 234D. Notice of demand and challan are being issued." 7. Though, the Assessing Officer has taken the ALV as the rate of rent in respect of a building situated in the area, however, the Assessing Officer has not given the assessee a fair opportunity to raise the objection against adopting the said rate of rent as fair market rental value of the property in question while determining the ALV of the property. There is not dispute that in case the Assessing Officer finds that the rental income shown by the assessee is not in the parity of the reasonable expected sum for letting out of the property in terms of section 23 (1) of the Income Tax Act. The Assessing Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
