ACIT, C-4 , Chandigarh V. M/s Punjab State Civil Supply Corp. Ltd., Chandigarh

ITA 13/CHANDI/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 1294 (ITAT-CHANDIGARH)
• Duration Of Justice: 8 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-09-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 03-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: JAGDEEP GOYAL
• Assessee Lawyers: MUNISH KHULLER
• Keywords: Business expenditure; Additional evidence; Notional interest

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, B CHANDIGARH BEFORE SHRI SANJAY GARG, JUDICIAL MEMBE AND MS. ANNAPURNA GUPTA, ACCOUNTANTMEMBER ITA NO. 13/CHD/2018 ASSESSMENT YEAR: 2013-14 THE ACIT-4(1), VS. M/S PUNJAB STATE CIVIL SUP PLY CHANDIGARH CORPORATION LTD., SCO 36-40, SECTRO 34A, CHANDIGARH TAN NO.PTLS10764F (APPELLANT) (RESPONDENT) APPELLANT BY : SH. JAGDEEP GOYAL, CIT DR RESPONDENT BY : SH. MUNISH KHULLER, ADVOCAT E DATE OF HEARING : 30.08.2018 DATE OF PRONOUNCEMENT : 07. 09.2018 ORDER PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL HAS BEEN PREFERRED BY THE REVE NUE AGAINST THE ORDER DATED 26.10.2017 OF THE COMMISSIONER OF I NCOME TAX(A)-2, CHANDIGARH [HEREINAFTER REFERRED TO AS CIT(A)]. 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS OF APPE AL:- I) WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. C1T(A) HAS ERRED IN DELETING THE DISALLOWANCE OF RS. 18,85,69,600/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF NON- CHARGING OF INTEREST FROM STATE GOVT. II) WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE DISALLOWANCE OF RS.40,74,54,100/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF NON- CHARGING OF RECEIVABLE FROM FCI. III) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ITA NO.13/CHD/2018- M/S PUNJAB STATE CIVIL SUPPLY CORPN LTD., CHANDIGAR H 2 DISALLOWANCE OF RS.4,68,26,000/- ON ACCOUNT OF PRIOR PERIOD EXPENSES WHICH THE ASSESSEE HAD CLAIMED THAT THE SAME HAD BEEN SET OFF AGAINST PRIOR PERIOD INCOME WHEN THE ASSESSEE HAS BEEN FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING WITHOUT APPRECIATING HOW THE PRIOR PERIOD INCOME WAS ACCOUNTED FOR IN THE PARTICULAR ASSESSMENT YEAR UNDER MERCANTILE SYSTEM OF ACCOUNTING AND WITHOUT VERIFYING AS TO WHETHER THE SAID EXPENSES WERE SET-OFF AGAINST THE INCOME DERIVED DURING THE RELEVANT ASSESSMENT YEAR ONLY. IV) WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) WAS RIGHT IN DELETING THE ADDITION OF RS. 1,141,000/- ON ACCOUNT OF UNREALIZED RENT. . 3. AT THE OUTSET, LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT THE ISSUES RAISED VIDE ABOVE GROUNDS (I) TO (II) OF THE APPEAL ARE SQUARELY COVERED BY THE DECISIONS OF THE TRIBUNAL I N EARLIER ASSESSMENT YEARS IN FAVOUR OF THE ASSESSEE. FURTHE R, OUR ATTENTION HAS BEEN INVITED TO THE RECENT DECISION OF THE TRIBUNA L PASSED IN ITA NO. 223/CHD/2017 ORDER DATED 22.3.2018, WHEREIN, THE TR IBUNAL WHILE RELYING UPON ITS EARLIER ORDERS HAS DELETED THE ADD ITIONS MADE ON IDENTICAL GROUNDS. THE RELEVANT PART OF THE ORDER D ATED 22.3.2018 IS REPRODUCED AS UNDER:- 4. WE HAVE GONE THROUGH THE ORDER OF THE TRIBUNAL DATED 20.9.2013 WHEREIN, THE TRIBUNAL WHILE DELETING THE IDENTICAL ADDITIONS IN EARLIER YEARS HAS FURTHER RELIED UPON THE DECISION OF THE TRIBUNAL FOR ASSESSMENT YEAR 2007-0 8 IN ITA NO. 1183/CHD.2011. WE HAVE ALSO PERUSED THE ORDER O F THE TRIBUNAL DATED 11.5.2012 IN ITA NO.1183/CHD/2011 (S UPRA) WHEREIN THE TRIBUNAL WHILE DELETING THE ADDITION IN PARA 8, 9 & 10 HAS OBSERVED AS UNDER:- 8. AFTER HEARING THE LD. REPRESENTATIVES OF BOTH T HE PARTIES, WE FIND THAT BOTH THE ISSUES RAISED VIDE GROUND NOS.1 & 2 OF THE APPEAL ARE COVERED IN FAVOU R OF THE ASSESSEE AND AGAINST THE REVENUE BY THE DECISION OF THIS BENCH OF THE TRIBUNAL DATED 30.6.2 010 PASSED IN ASSESSEES CASE IN ITA NO. 875/CHD/2009 ITA NO.13/CHD/2018- M/S PUNJAB STATE CIVIL SUPPLY CORPN LTD., CHANDIGAR H 3 RELATING TO ASSESSMENT YEAR 2006-07. IN THAT YEAR , A SUM OF RS. 1,71,20,58,413/- WAS OUTSTANDING FROM TH E PUNJAB GOVERNMENT WHEREAS RS. 6,25,87,18,142/- WAS RECOVERABLE FROM FCI. THE ASSESSING OFFICER DISALLOWED NOTIONAL INTEREST AMOUNTING TO RS. 11,98,43,089/- AND RS. 43,53,42,284/- ON ACCOUNT OF SAID INTEREST-FREE OUTSTANDINGS / RECOVERABLES FROM PUNJAB GOVT. AND FCI RESPECTIVELY. ON APPEAL, THE CIT(A) OPINED THAT THE AMOUNTS RECOVERABLE WERE TRADE DEBITS AND THEREFORE, THE ACTION OF THE ASSES SING OFFICER WAS SET ASIDE AND THE ADDITIONS MADE WERE DELETED. 9. IN SECOND APPEAL, THE TRIBUNAL UPHELD THE ORDER OF CIT(A) ON BOTH THE ISSUES OBSERVING AS UNDER:- 22. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFULLY. THE ASSESSEE BEFORE US IS A CO- OPERATIVE SOCIETY, WHICH IS AN AGENCY OF THE STATE GOVERNMENT FOR PROCUREMENT OF WHEAT AND PADDY. IT ALSO UNDERTAKES SUCH ACTIVITIES FOR FCI. IN THE COURSE OF CARRYING ON OF SUCH ACTIVITIES, IT INCURRED AMOUNTS WHICH WERE RECOVERABLE FROM THE STATE GOVERNMENT AND FCI. QUITE CLEARLY, SUCH RECOVERIES ARE ON ACCOUNT OF TRADING ACTIVITIES CARRIED OUT BY THE ASSESSEE. THEREFORE, THE AMOUNT OUTSTANDING FOR RECOVERY AT THE END OF THE YEAR ON ACCOUNT OF SUCH ACTIVITIES CANNOT BE EQUATED TO INTEREST-FREE ADVANCES SO AS TO REQUIRE THE SAME TO BE DECIDED IN TERMS OF SECTION 36(1)(III) OF THE ACT. IN THIS REGARD, THE CIT(APPEALS) HAS CATEGORICALLY HELD THAT THE PUNJAB GOVERNMENT AND FCI ARE TRADE DEBTORS AND INCOMES THEREOF HAVE BEEN OFFERED FOR TAXATION IN THE EARLIER ASSESSMENT YEARS. IN THE FACE OF SUCH A FACT SITUATION, WE FIND NO JUSTIFICATION FOR THE ASSESSING OFFICER TO MAKE ANY DISALLOWANCE OUT OF INTEREST EXPENDITURE CLAIMED BY THE ASSESSEE ON ACCOUNT OF IMPUGNED DEBITS. HENCE, IN THIS BACKGROUND, WE HEREBY AFFIRM THE ORDER OF THE CIT(APPEALS). THUS, GROUND NOS. 3 & 4 RAISED ARE DISMISSED. 10. THE FACTS OF THE PRESENT CASE ARE SIMILAR TO THAT OF ASSESSMENT YEAR 2006-07. RESPECTFULLY FOLLOWING THE ORDER OF THE TRIBUNAL PASSED IN ASSESSEES CASE FOR ASSESSMENT YEAR 2006-07 ((SUPRA), WE DO NOT FIND ANY MERIT IN THE APPEAL ITA NO.13/CHD/2018- M/S PUNJAB STATE CIVIL SUPPLY CORPN LTD., CHANDIGAR H 4 PREFERRED BY THE REVENUE. ACCORDINGLY, WE DISMISS THE SAME. 4. THE LD. DR COULD NOT POINT OUT ANY DISTINGUISHIN G FACTS TO JUSTIFY OUR INTERFERENCE IN THE ABOVE ORDER OF THE CIT(A). 5. WE FIND THAT THE FACTS AND ISSUE RAISED VIDE GRO UND NOS. (I) AND II) ARE SQUARELY COVERED WITH THE ABOVE DECISION OF THE TRIBUNAL, HENCE, RESPECTFULLY FOLLOWING THE SAME, THE ISSUE R AISED VIDE GROUND NOS. 1 & 2 ARE DECIDED AGAINST THE REVENUE. 6. GROUND NO. (III) : A PERUSAL OF THE GROUND NO. (III) REVEALS THAT THE SAME IS RELATING TO PRIOR PERIOD EXPENSE. WE FIND THAT SIMILAR ISSUE HAS BEEN DECIDED BY THE TRIBUNAL AGAINST THE REVENUE VIDE ORDER DATED 22.3.2018 FOR ASSESSMENT YEAR 2012-13 ( SUPRA), WHEREIN, THE TRIBUNAL IN TURN HAS FOLLOWED ITS EARLIER DEC ISION IN THE CASE OF WINSOME YARNS LTD ITA NO.541/P./2009-10 DATED 15.11 .2010. THE RELEVANT PART OF THE ORDER OF THE TRIBUNAL IS REPRO DUCED AS UNDER:- GROUND NO. 4 - A PERUSAL OF THE GROUND NO.4 (NUMBE RED AS GROUND NO. (VII) REVEALS THAT THE SAME IS RELATI NG TO PRIOR PERIOD EXPENSE. THE LD. COUNSEL FOR THE ASSES SEE HAS STATED THAT ISSUE HAS BEEN SQUARELY COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF WINSOME YAR NS LTD ITA NO.541/P./2009-10 DATED 15.11.2010. THE LD. CI T(A) WHILE DECIDING THIS ISSUE HAS FOLLOWED THE ORDER OF THE TRIBUNAL IN AFORESAID CASE. WE FIND THAT LD. CIT(A) WHILE DECIDING THE ISSUE IN FAVOUR OF THE ASSESSEE HAS OB SERVED AS UNDER:- 8.3.1 THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE ARE ADMITTED IN THE INTEREST OF NATURAL JU STICE. THE REMAND REPORT OF A.O WAS GIVEN TO THE APPELLANT FOR MAKING SUBMISSION. THE SUBMISSION OF THE APPELLANT, REMAND REPORT AND THE ASSESSMENT ORDER ITA NO.13/CHD/2018- M/S PUNJAB STATE CIVIL SUPPLY CORPN LTD., CHANDIGAR H 5 HAVE BEEN CAREFULLY CONSIDERED. THE APPELLANT HAS PLACED RELIANCE ON THE DECISION OF HON'BLE ITAT, CHANDIGARH BENCH IN THE CASE OF WINSOME YARNS LTD. APPEAL NO. 541/P/09-10 DATE OF ORDER 15.11.2010. APPELLANT FILED COPY OF THE ORDER WHICH HAS BEEN PERUSED BY ME. THE SIMILAR ISSUE WAS CONSIDERED AND DECIDED BY HON'BLE TRIBUNAL CHANDIGARH BENCH IN THE ABOVE ORDER AS UNDER:- 11. I HAVE CAREFULLY CONSIDERED RIVAL CONTENTIONS AND MATERIAL ON RECORD. I FIND THAT THE ASSESSING OFFICER DISALLOWED PRIOR PERIOD EXPENSES AMOUNTING TO RS. 10,70,480/- AS THE SAME WERE SET OFF AGAINST PRIOR PERIOD INCOME OF RS. 10,70,480/- SIMPLY STATING THAT FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING, THE ASSESSEE SHOULD HAVE CLAIMED EXPENSES IN THE RELEVANT ASSESSMENT YEAR. IN MY VIEW, THE ASSESSING OFFICER FAILED TO GIVEN REASON WHY PRIOR PERIOD INCOME COULD NOT BE SET OFF AGAINST THE EXPENSES, WHILE ON THE OTHER HAND THE ASSESSING OFFICER HAS NOT ONLY GIVEN ENOUGH REASON BUT HAS RELIED ON VARIOUS JUDICIAL DECISIONS WHEREIN PRIOR PERIOD INCOME WAS ALLOWED TO BE SET OFF AGAINST PRIOR PERIOD EXPENSES. THE PERTINENT OBSERVATION OF THE DECISION OF DELHI BENCH OF THE TRIBUNAL IN THE CASE OF MODI INDUSTRIES LTD. IN ITA NO. 2245/DEL/2007 IS EXTRACTED BELOW :- '7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. WE FIND THAT AS PER THE DETAILS FURNISHED BY THE ASSESSEE ON PAGE 19 OF THE PAPER BOOK, IN THE PRESENT YEAR, THE ASSESSEE HAS CLAIMED DEDUCTION ON ACCOUNT OF PRIOR PERIOD EXPENSES OF RS, 15.38 LACS AND AT THE SAME TIME, THE ASSESSEE HAS OFFERED PREVIOUS YEAR INCOME TO THE EXTENT OF RS. 18.78 LAKHS. THIS SHOWS THAT INCOME OFFERED ON ACCOUNT OF PREVIOUS YEAR IS MORE THAN THE CLAIM OF THE ASSESSEE RELATING TO PREVIOUS YEAR EXPENSES, IF THE PREVIOUS YEAR EXPENSES ARE NOT ALLOWABLE IN THE PRESENT YEAR THEN ON THE SAME LOGIC, PREVIOUS YEAR INCOME IS ALSO NOT ASSESSABLE IN THE PRESENT YEAR AND BOTH OF THEM SHOULD BE CONSIDERED IN THE RELEVANT YEAR. SINCE, THE ASSESSING OFFICER HAS ALREADY ASSESSED PREVIOUS YEAR INCOME IN THE PRESENT YEAR, WE FIND NO REASON TO DISALLOW THE CLAIM OF THE ASSESSEE REGARDING PREVIOUS YEAR EXPENSES SINCE THESE EXPENSES ARE LESSER THAN SUCH INCOMES, BUT THE SAME TIME, THIS HAS TO BE ITA NO.13/CHD/2018- M/S PUNJAB STATE CIVIL SUPPLY CORPN LTD., CHANDIGAR H 6 SEEN AS TO WHETHER SUCH PREVIOUS YEAR EXPENSES ARE OTHERWISE ALLOWABLE OR NOT BECAUSE WE HAVE NOTED THAT SOME OF THE EXPENSES ARE ON ACCOUNT OF PENALTY AND SOME OF THE EXPENSES ARE INFRASTRUCTURE EXPENSES WHICH MAY NOT BE FOUND OTHERWISE ALLOWABLE. WE, THEREFORE, SET ASIDE THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) ON THE ISSUE AND RESTORE THIS MATTER BACK TO THE FILE OF THE ASSESSING OFFICER FOR FRESH DECISION. THE ASSESSING OFFICER SHOULD EXAMINE THE NATURE OF THESE EXPENSES AND THE SAME SHOULD BE ALLOWED IF IT IS FOUND THAT THESE EXPENSES ARE OTHERWISE ALLOWABLE. THIS GROUND OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSE. (EMPHASIS SUPPLIED) 12 IN VIEW OF THE ABOVE DECISION, THE ADDITION ON THIS GROUND IS DELETED, ALLOWING ASSESSEE'S APPEAL .' 8.3.2 THE FACTS IN THE CASE OF THE ASSESSEE ARE I DENTICAL TO THE FACTS IN THE CASE OF THE DECISION REFERRED A BOVE. DURING THE YEAR THE ASSESSING OFFICER HAS ASSESSED THE PRIOR PERIOD INCOME OF RS. 974.74 LACS AND, THEREFO RE, THE PRIOR PERIOD EXPENSES OF RS. 676.49 ARE ALSO ALLOWA BLE BY RESPECTFULLY FOLLOWING THE DECISION OF HON'BLE ITAT , CHANDIGARH BENCH IN THE CASE OF M/S WINSOME YARNS L TD. AS THESE EXPENSES ARE NORMAL BUSINESS EXPENSES WHIC H ARE OTHERWISE ALLOWABLE. THEREFORE, A.O IS DIRECTED TO ALLOW PRIOR PERIOD EXPENSES OF RS. 676.49 LACS AGAINST TH E PRIOR PERIOD INCOME OF RS. 974.74 LACS. GROUND OF APPEAL NO. 4 IS ALLOWED. 7. THE PERUSAL OF THE ABOVE ORDER REVEALS THAT LD. CIT(A) WHILE DECIDING THIS ISSUE HAS FOLLOWED THE DECISION OF TH E TRIBUNAL. THE LD. DR COULD NOT POINT OUT ANY DISTINGUISHING FACTS TO JUSTIFY OUR INTERFERENCE IN THE ABOVE ORDER OF THE CIT(A). THIS ISSUE IS ALSO ACCORDINGLY DECIDED AGAINST THE REVENUE 5. IN VIEW OF OUR FINDINGS GIVEN ABOVE, THERE IS NO MERIT IN THE ABOVE GROUNDS OF THE REVENUE AND THE SAME ARE ACCOR DINGLY DISMISSED. ITA NO.13/CHD/2018- M/S PUNJAB STATE CIVIL SUPPLY CORPN LTD., CHANDIGAR H 7 6. GROUND NO.( IV) BOTH THE LD. REPRESENTATIVES OF THE PARTIES HAVE SUBMITTED THAT THE ISSUE IS SQUARELY COVERED I N FAVOUR OF THE ASSESSEE IN HIS OWN CASE BY THE EARLIER DECISION OF THE TRIBUNAL IN ITA NOS. 708 & 709/CHD/2013 FOR ASSESSMENT YEARS 20 08-09 AND 2009-10. THE TRIBUNAL WHILE ADJUDICATING THE IDENTI CAL ISSUE VIDE GROUND NO.3 OF ITA NO. 709/CHD/2013 HAS OBSERVED AS UNDER:- 11 GROUND NO. 3 AFTER HEARING BOTH THE PARTIES WE FIND THAT DURING ASSESSMENT PROCEEDINGS THE AO NOTICED THAT NO PROVISION OF RENT AMOUNTING TO RS. 11.79 LAKHS OF BUILDING GIVEN TO FOOD & CIVIL SUPPL IES DEPARTMENT WAS MADE. IN RESPONSE TO THE QUERY IN THIS RESPECT THE ASSESSEE GAVE FOLLOWING REPLY VIDE LETTER DATED 8.11.2011 AS UNDER : THAT THE BUILDING IN QUESTION IS WITH FOOD, CIVIL SUPPLIES & CONSUMER AFFAIRS DEPARTMENT, PUNJAB SINCE LONG FOR WHICH NO RATE OF RENT HAS SINCE BEEN FIXED DESPITE GREAT PERSUASION AT THE LEVEL OF MANAGEMENT. THUS NO PROVISION IN THIS REGARD HAS BEEN MADE. AS AND WHEN ANY AMOUNT OF RENT IS REALIZED FROM THE STATE GOVERNMENT THE SAME WOULD BE TREATED AS INCOME ON RECEIPT BASIS. HOWEVER, THE ASSESSING OFFICER WAS NOT SATISFIED AS ACCORDING TO HIM ANNUAL VALUE OF THE PROPERTY WAS CHARGEABLE TO INCOME-TAX IRRESPECTIVE OF THE FACT T HAT RENT HAS BEEN RECEIVED IN THE YEAR OR NOT. ACCORDI NG TO HIM ANNUAL VALUE WAS OF RS. 8,25,300/- WAS CHARGEABLE AFTER GIVING DEDUCTION OF 30%. 12 ON APPEAL ADDITION WAS DELETED BY THE LD. CIT(A) ON THE BASIS OF ORDER OF THE TRIBUNAL FOR ASSESSME NT YEAR 2004-05 IN ITA NO. 561/CHD/2007. 13 BEFORE US, THE LD. DR FOR THE REVENUE SUPPORTED THE ORDER OF THE ASSESSING OFFICER. 14 ON THE OTHER HAND, THE LD. COUNSEL OF THE ASSESSEE SUBMITTED THAT THE ISSUE IS COVERED AGAINS T THE REVENUE BY THE ORDER OF THE TRIBUNAL FOR ASSESSMENT YEAR 2004-05 IN ITA NO. 561/CHD/2007. 15 AFTER CONSIDERING THE RIVAL SUBMISSIONS WE FIND THAT IDENTICAL ISSUE CAME UP FOR CONSIDERATION OF T HE TRIBUNAL IN ASSESSMENT YEAR 2004-05 WHICH HAS BEEN DECIDED BY THE TRIBUNAL VIDE PARA 5 & 6 WHICH READ AS UNDER: 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS CAREFULLY. SECTION 22 OF THE ACT PROVIDES FOR TAXAT ION OF ANNUAL VALUE OF THE PROPERTY OWNED BY THE ASSESSEE. THE DETERMINATION OF ANNUAL VALUE IS IN TERMS OF SE CTION ITA NO.13/CHD/2018- M/S PUNJAB STATE CIVIL SUPPLY CORPN LTD., CHANDIGAR H 8 23 OF THE ACT. IN TERMS OF SUB-SECTION (1) CLAUSE ( A), THE ANNUAL VALUE IS DEEMED TO BE THE SUM FOR WHICH THE PROPERTY CAN BE REASONABLY EXPECTED TO BE LET FROM YEAR TO YEAR. IN CLAUSE (B) THE ANNUAL VALUE IS TO THE R ENT RECEIVED OR RECEIVABLE IN EXCESS OF THE SUM REFERRE D TO IN CLAUSE (A) IN CASE WHERE THE PROPERTY IS LET OUT. C LAUSE (C) REFERS TO A SITUATION WHERE THE PROPERTY IS LET OUT AND IS VACANT EITHER FOR THE WHOLE OR PART OF THE PERIO D UNDER CONSIDERATION. FOR THE PRESENT PURPOSE IT IS SUFFIC IENT FOR US TO NOTE THAT PROPERTY IN QUESTION HAS BEEN LET O UT. THUS IT IS CLAUSE (B) OF SUB-SECTION (1) SECTION 24 WHICH IS RELEVANT. ACCORDING TO IT THE ANNUAL VALUE IS TO BE DETERMINED AT THE RENT RECEIVED OR4 RECEIVABLE BY T HE ASSESSEE IF THE SAME IS IN EXCESS OF THE SUMS REFER RED TO IN CLAUSE (A) THEREOF. 6. WE HAVE PERUSED THE ORDER OF THE ASSESSING OFFICER AND FIND THAT A SUM OF RS. 7 LACS HAS BEEN CREATED AS RENT OF THE PROPERTY WHICH HAS NOT BEEN RECEIVED. THERE IS NO FINDING THAT THE SAID AMOUNT IS LOWER THAN THE AMOUNT FOR WHICH THE PROPERTY IS EXP ECTED TO BE LET OUT. BE THAT AS IT MAY, WE PROCEED ON THE BASIS THAT THE ANNUAL VALUE IS TAKEN AS THE ACTUAL RENT RECEIVABLE BY THE ASSESSEE. IT IS ALSO NOT IN DISPU TE THAT THE AMOUNT HAS NOT BEEN ACTUALLY RECEIVED BY THE ASSESSEE, THE PROVISIONS OF SECTION 25AA READ AS UN DER: 25AA. WHERE THE ASSESSEE CANNOT REALIZE RENT FROM A PROPERTY LET TO A TENANT AND SUBSEQUENTLY THE ASSESSEE HAS REALIZED ANY AMOUNT IN RESPECT OF SUCH RENT, THE AMOUNT SO REALIZED SHALL BE DEEMED TO BE INCOME CHARGEABLE UNDER THE HEAD INCOME FROM HOUSE PROPERTY AND ACCORDINGLY CHARGED TO INCOME-TAX AS THE INCOME OF THAT PREVIOUS YEAR IN WHICH SUCH RENT IS REALIZED WHETHER OR NOT THE ASSESSEE IS THE OWNER OF THAT PROPERTY IN THAT PREVIOUS YEAR. WHICH CLEARLY OPERATE IN THE PRESENT CASE. A PERUSA L OF THE AFORESAID SECTION PROVIDES COMPLETE ANSWER TO T HE OBJECTION OF THE ASSESSING OFFICER. IN TERMS OF THE SAID SECTION THE IMPUGNED AMOUNT CANNOT BE BROUGHT TO TA X IN THE INSTANT YEAR. IN THE RESULT, WE HEREBY SET ASID E THE ORDER OF THE CIT(APPEALS) AND DIRECT ASSESSING OFFI CER TO DELETE THE ADDITION IN QUESTION. FOLLOWING THE ABOVE, WE DECIDE THE ISSUE AGAINST TH E REVENUE. 16 IN THE RESULT, BOTH THE APPEALS OF THE REVENUE ARE DISMISSED. RESPECTFULLY FOLLOWING THE AFORESAID DECISION OF TH E TRIBUNAL, THIS ISSUE IS ALSO DECIDED IN FAVOUR OF THE ASSESSEE . ITA NO.13/CHD/2018- M/S PUNJAB STATE CIVIL SUPPLY CORPN LTD., CHANDIGAR H 9 WE, THEREFORE, DO NOT FIND ANY INFIRMITY IN THE ORD ER OF THE CIT(A) AND THE APPEAL OF THE REVENUE IS THEREFORE, DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07.09.2018 SD/- SD/- (ANNAPURNA GUPTA) (SANJAY GARG) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :07.09.2018 RKK COPY TO: THE APPELLANT THE RESPONDENT THE CIT THE CIT(A) THE DR