TMI Blog1983 (8) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... ion, situation of the self occupied property and estimated at the rate of Rs. 1000 per month i.e. ALV comes to Rs. 12,000. Being aggrieved, the assessee carried the matter before the AAC. According to the AAC, considering the fact indicated in para 2 the ALV of the property in question should be at Rs. 1638. Being aggrieved, the revenue came in appeal before us. 2. The submission of the ld. Departmental Representative Shri Hazarilal was that the property in question is newly constructed bungalow and the constructed area is 238 sq. yds. If the AAC's estimate is accepted the monthly rent of the bungalow will come to less than Rs. 150 per month. That is beyond imagination in the asst. yr. 1980-81 in Ahmedabad. He relied on the decision of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... came for consideration before various High Courts and the Supreme Court as to what should be the reasonable rent of the property. The ld. counsel for the assessee cited two decisions of their Lordships of the Supreme Court. These are Guntur Municipal Council vs. Guntur Town Rent Payer's Association (AIR 1971 SC 353) and Corporation of Calcutta vs. Smt. Padma Debi (AIR 1971 SC 151). Their Lordships have taken the view that the law is well settled. The assessment of valuation for the purpose of tax must be made in accordance with the provisions of the Rent Control Act which would be in force during the period of assessment. 4. In the case of Dewan Daulatrai Kapoor vs. New Delhi Municipal Committee Anr., cited supra, the issue before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... preme Court in the case of Amolak Ram Khosla vs. CIT (1981) 131 ITR 589 (SC) holding that the ALV should be taken in accordance with the standard determinable under the Rent Control Act law. From the ratios of the these decisions it does not leave any room for the doubt that the ALV u/s 23 of the IT Act should be taken in accordance with the provisions of Rent Control Act applicable in the respective States. Now, the next question which remains for our consideration is whether the standard rent means the rent taken by the Municipal Corporation or Small Causes Courts. A similar issue was considered by the Kerala High Court in the case of C.J. George vs. CIT (1973) 92 ITR 137 (Ker). The issue before their Lordships was that the assessee has c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the department. Even from the comparable cases cited by the assessee in his paperbook at page 3 the ALV indicated are Rs. 3000, Rs. 4000, Rs. 2500 and Rs. 3200 respectively. We do not know how the Municipal Corporation has estimated a rent of Rs. 1638 per year of a bangalow constructed in 238 sq. yds. At this stage, we do not want to comment on the figures taken by the Municipal Corporation but apparently that must not be a reasonable rent of a newly constructed bungalow covering constructed area of 238 sq. yds. Further, the rent adopted by the Municipality or by a local authority is not binding on the department because the department was not a party so far as the fixation of rent by Municipality or local authority of a particular proper ..... X X X X Extracts X X X X X X X X Extracts X X X X
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