PCS Finance Pvt.Ltd., Pune V. ACIT, R-3, Pune, Pune

ITA 1440/PUN/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 56509 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 9 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 03-05-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 15-12-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ANN KAPTHUAMA
• Keywords: Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE BEFORE SHRI I.C. SUDHIR (JM) AND SHRI G.S. PANNU (AM) ITA NO. 1440/PN/2009 (ASSTT. YEAR: 2006-07) PCS FINANCE PVT. LTD. ... APP ELLANT S.NO. 1A, IRANI MARKET COMPOUND, YERAWADA, PUNE 411006 PAN : AACCP 7003 R V. ADDL. CIT, RANGE-3, PUNE RESPONDENT APPELLANT BY : SHRI C.H. NANIWADEKAR RESPONDENT BY : MS. ANN KAPTHUAMA DATE OF HEARING :16.8.11 DATE OF PRONOUNCEMENT: .10.11 ORDER PER I.C. SUDHIR, JM THE ASSESSEE HAS QUESTIONED FIRST APPELLATE ORDER ON THE FOLLOWINGL GROUNDS : IN THE FACT AND THE CIRCUMSTANCES OF CASE, AND IN LAW, THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) II, PUNE, ERR ED IN CONFIRMING THE ADDITIONS AND OBSERVATIONS MADE BY THE ASSESSING O FFICER IN THE ASSESSMENT ORDER IN RESPECT OF FOLLOWING POINTS. HE ERRED: 1. IN RESPECT OF INCOME UNDER THE HEAD INCOME FROM HO USE PROPERTY. A) IN CONFIRMING THE ADDITION OF RS. 7,74,287 (GROSS A MOUNT RS. 11,06,124, LESS 30% DEDUCTION TOWARDS REPAIRS RS. 3 ,31,837) UNDER THE HEAD INCOME FROM HOUSE PROPERTY. B) IN CONFIRMING THE ADDITION OF NOTIONAL INCOME WHICH IS NEITHER RECEIVED NOR ACCRUED TO THE COMPANY C) IN NOT APPRECIATING THAT AS PER THE CORRESPONDENCE THE RENT WAS NOT ACTUALLY RECEIVED AND THE PROPERTIES WERE NOT ACTUA LLY USED BY THE TENANT FOR THE PERIOD FROM 1.7.2005 TO 31.12.2005 F OR WHICH THE AO HAS COMPUTED THE NOTIONAL INCOME ITA . NO 1440/PN/2009 PCS FINANCE LTD., A.Y. 2006-07 PAGE OF 8 2 D) IN NOT APPRECIATING THAT THE PROVISIONS OF SECTION 23(1)(C ) ARE APPLICABLE IN THE FACTS AND CIRCUMSTANCES OF THE CA SE AND NOT THAT OF SECTION 23(1)(A) 2. IN RESPECT OF CONFIRMATION LETTERS SUBMITTED DURING THE COURSE OF APPELLATE PROCEEDINGS: A) IN TREATING THE CONFIRMATION LETTERS AS ADDITIONAL EVIDENCE AND HENCE REJECTING THE SAME WHERE IN FACT THESE LETTERS JUST CONFIRMED THE FACTS ALREADY ON RECORD. B) IN OBSERVING THAT SINCE THE CONFIRMATION LETTERS AR E FROM ASSOCIATE CONCERNS UNDER THE SAME MANAGEMENT, SUCH MUTUALLY C ONVENIENT CONFIRMATION LETTERS HAVE GOT NO MEANING. 2. THE RELEVANT FACTS ARE THAT ASSESSEE COMPANY HAD EA RNED RENTAL INCOME FROM ITS VARIOUS PROPERTIES. FOLLOWING 4 FLATS AND 15 OTHER FLATS WERE GIVEN ON RENT BY THE ASSESSEE TO PATNI COMPUTER SYSTEMS LTD. SI NCE JANUARY 2000 : A. FLAT NO. 19/A-31 AT TAKSHILA, ANDHERI EAST, MUMBAI B. FLAT NO. 19/A-32 AT TAKSHILA, ANDHERI EAST, MUMBAI C. FLAT NO. 301-H AT KUKREJA COMPLEX, BHANDUP WEST, MU MBAI D. FLAT NO. 501-F AT KUKREJA COMPLEX, BHANDUP WEST, MU MBAI IN ALL THESE 19 CASES, THE LAST LEAVE AND LICENSE A GREEMENT WAS EFFECTIVE UPTO 31 ST DECEMBER 2005. IN RESPECT OF ABOVE REFERRED 4 FLAT S, PATNI COMPUTER SYSTEMS LTD. VIDE ITS LETTER DATED JUNE 2005 INTIMATED THAT THE Y HAD DISCONTINUED THE USE OF THE PROPERTY W.E.F. 1.7.2005. ACCORDINGLY, THEY DID NO T PAY RENT FROM THAT DATE. THE A.O. DID NOT ACCEPT THIS SUBMISSION OF THE ASSESSEE AND COMPUTED THE ADDITIONAL RENT RECEIVABLE FOR THE PERIOD JULY 2005 TO DECEMBE R 2005 AT RS. 2,29,497/- FOR THE 2 FLATS AT TAKSHILA, ANDHERI EAST, MUMBAI; RS. 2,07 ,750/- FOR THE FLAT NO. 301-H AT KUKREJA COMPLEX, BHANDUP WEST, MUMBAI AND RS. 1,38 ,666/- FOR FLAT NO. 501F AT KUKREJA COMPLEX. THE A.O OBSERVED THAT PATNI COMPU TER SYSTEMS LTD. (PCS) IN THEIR SURRENDER LETTER DATED 28.11.2005 HAS MENTION ED THAT IT DID NOT REQUIRE THE PREMISES AND WILL HAND OVER THE VACANT POSSESSION O F THE FLATS ON EXPIRY OF THE LEASE AGREEMENT ON 1.1.2006. THE ASSESSEE WAS THUS NOT RIGHT IN SHOWING RENT FROM PCS ITA . NO 1440/PN/2009 PCS FINANCE LTD., A.Y. 2006-07 PAGE OF 8 3 ONLY FOR 3 MONTHS I.E. UPTO JUNE 2005 WHEREAS IT SH OULD HAVE SHOWN FOR 9 MONTHS UPTO DECEMBER 2005, EVEN IF THE RENT HAD ACTUALLY N OT BEEN RECEIVED. THE LD CIT(A) HAS UPHELD THE SAME. THE LD CIT(A) ALSO AP PROVED THE ACTION OF THE A.O THAT THIS CASE FALLS U/S. 23(1)(A) AND NOT U/S. 23( 1)(C ) OF THE ACT AS PLEADED BY THE ASSESSEE SINCE AS PER THE A.O, IT IS A CASE WHERE THE PROPERTY WAS NEVER VACANT. 3. THE A.O OBSERVED FURTHER THAT THE ABOVE FLATS WERE ALSO GIVEN ON RENT TO PCS INDUSTRIES LTD. FROM 1.1.2006 TO 31.3.2006 ON LOW R ENT. THE 2 FLATS AT TAKSHILA, ANDHERI EAST WERE GIVEN AT A MONTHLY RENT OF RS. 10 ,000/-, WHEREAS TILL 31 ST DECEMBER 2005, IT WAS GIVEN TO PCS AT RS. 38,249/- PER MONTH. THE OTHER TWO FLATS AT KUKREJA COMPLEX WERE LET OUT TO THE SISTER CON CERN AT A MONTHLY RENT OF RS. 6000/- AND RS. 8000/- PER MONTH RESPECTIVELY WHEREA S EARLIER, THESE 2 FLATS WERE GIVEN AT THE RATE OF RS.34,626/- AND RS. 23,111/- P ER MONTH. THE ASSESSEE EXPLAINED BEFORE THE A.O THAT THEY COULD NOT FIND S UITABLE TENANTS, AND, THEREFORE, INSTEAD OF KEEPING THE FLAT VACANT, THEY HAD GIVEN IT ON LOW RENT AT LOWER RATE TO ANOTHER SISTER CONCERN OF PCS LTD. IT WAS ALSO CON TENDED BY THE ASSESSEE THAT IT WAS COVERED U/S. 23(1)( C ) AND NOT U/S. 23(1)(A) . THE A.O. REJECTED THIS EXPLANATION. THE A.O STATED THAT THERE WAS NO REASO N FOR THIS DRASTIC DECREASE IN THE RENT FOR THE PERIOD W.E.F. 1.1.2006. IT WAS STAT ED THAT IT WAS MERELY TO HELP THE SISTER CONCERN PCS (FORMERLY PCS INDUSTRIES LTD.). A.O. CALCULATED THE RENT RECEIVABLE FOR THE ENTIRE YEAR AT THE SAME RATE AS THE PROPERTY WAS HIRED TO PCS FOR THE PERIOD APRIL 2005 TILL DECEMBER 2005. FOR THIS PURPOSE, PROVISIONS OF SECTION 23(1)(A ) WERE RELIED UPON. IT RESULTED IN THE GRO SS ADDITION TO INCOME FROM HOUSE PROPERTY BY AN AMOUNT OF RS. 11,06,124/-. THE A.O, ALSO DID NOT AGREE WITH THE CONTENTION OF THE ASSESSEE THAT CASE WAS COVERED U/ S. 23(1)(C ) AND NOT U/S. 23(1)(A ) OF THE ACT. THE SAME HAS BEEN UPHELD BY THE LD CI T(A). REGARDING CONFIRMATION LETTER DATED 15.6.2009 FILED FROM PCS, THE LD CIT(A ) HELD THAT IT WAS NOT FILED BEFORE THE A.O NOR ANY APPLICATION HAS BEEN FILED BEFORE HIM UNDER RULE 46A OF THE I.T. RULES FOR THE ADMISSION OF THIS ADDITIONAL EVIDENCE . ITA . NO 1440/PN/2009 PCS FINANCE LTD., A.Y. 2006-07 PAGE OF 8 4 4. BEFORE THE TRIBUNAL, THE LD. A.R. SUBMITTED THAT PC S VIDE THEIR LETTER DATED 28.11.2005 HAD SURRENDERED THE FLAT UNDER THEIR TE NANCY FROM JULY 2005 AND HAD ALSO STOPPED PAYING THE RENT IN RESPECT OF THOSE FL ATS. THUS, ON THE BASIS OF THIS INTIMATION, THE ASSESSEE HAD NOT ACTUALLY RECEIVED RENT FOR THE PERIOD FROM 1.7.2005 TO 31.12.2005 IN RESPECT OF THE ABOVE 4 FLATS. THE ASSESSEE HAD GIVEN ON RENT THE ABOVE REFERRED 4 FLATS AND 15 OTHER FLATS TO PCS SI NCE JANUARY 2000. IN ALL THESE 19 CASES, THE LAST LEAVE AND LICENSE AGREEMENT WAS EFF ECTIVE UPTO 31 ST DECEMBER 2005. OUT OF REMAINING 15 FLATS, IN RESPECT OF 13 OTHER FLATS AT MUMBAI, PCS HAD ISSUED A FORMER LETTER IN RESPECT OF ALL THE FLATS STATING THAT THE AGREEMENT EXPIRED ON 31 ST DECEMBER 2005 AND THEY DID NOT WISH TO RENEW THE SAID ARRANGEMENT. THESE LETTERS WERE ISSUED IN RESPECT OF ALL THESE 17 FLAT S (4 FLATS AS ABOVE AND 13 OTHER FLATS IN MUMBAI) IN STANDARDIZED FORMAT. IN RESPECT OF T HE ABOVE 4 FLATS, PCS HAD SPECIFICALLY MENTIONED THAT THEY HAVE DISCONTINUED USING THESE FLATS SINCE JUNE 2005. THE NON-USER OF THESE FLATS AND NON-PAYMENT OF RENT IN RESPECT THEREOF FROM JULY 2005, IS MENTIONED IN THE LETTER IN RESPE CT OF THESE 4 FLATS ONLY AND NOT IN THE LETTERS IN RELATION TO OTHER FLATS. COPIES OF THESE LETTERS HAVE BEEN MADE AVAILABLE AT PAGE NO. 9 AND 16 OF THE PAPER BOOK FI LED ON BEHALF OF THE ASSESSEE. THUS, EFFECTIVELY THESE 4 FLATS CEASED TO BE GIVE N ON RENT FROM 1.7.2005 AND HENCE NO RENT WAS DUE IN RESPECT OF THESE 4 FLATS FROM TH IS DATE. THE BALANCE 15 FLATS, WERE BEING USED BY THEM UPTO 31 ST DECEMBER 2005/31 ST MARCH 2006 AND ACCORDINGLY, THEY PAID RENT ALSO WHICH HAS BEEN CO NSIDERED AS INCOME FROM HOUSE PROPERTY. HE SUBMITTED THAT INCOME FROM HOUSE PRO PERTY IN RESPECT OF THESE 15 FLATS IS NOT INCLUDED ON THE BASIS OF LEAVE AND LI CENSE AGREEMENT BUT ON THE BASIS OF ACTUAL USER BY TENANT AND PHYSICAL RECEIPT OF RENT. 5. THE LD. A.R. SUBMITTED THAT FORMAL HANDING OVER OF THE POSSESSION WAS KEPT IN ABEYANCE TILL THE REFUND OF DEPOSIT, SINCE THIS WAS DONE FOR ALL THE 17 FLATS COLLECTIVELY. IN FACT, THE DEPOSITS WERE REFUNDED ON 3 RD FEBRUARY 2006. ITA . NO 1440/PN/2009 PCS FINANCE LTD., A.Y. 2006-07 PAGE OF 8 5 6. THE LD. A.R. POINTED OUT THAT THE ABOVE 4 FLATS WER E GIVEN ON RENT TO PCS TECHNOLOGY LTD. (FORMERLY PCS INDUSTRIES LTD.) W.E. F. 1.1.2006. THE ASSESSEE WAS TRYING TO FIND TENANTS FOR ALL THE 17 FLATS. HOWEVE R, IT WAS UNABLE TO FIND SUITABLE TENANTS FOR THESE FLATS. THE RENT WITH PATNI COM PUTER SYSTEM LTD. (PCS) WAS FIXED IN 2000 WITH 15% INCREMENT EVERY YEAR. IT W AS NOT POSSIBLE TO GET THE LAST DRAWN RENT FOR THE FLATS. HENCE, 4 OUT OF THE 17 FLATS WERE GIVEN ON RENT TO PC INDUSTRIES LTD AT A MUTUALLY AGREED RENT. THEY HAD TAKEN ONLY 4 OUT OF THE 17 FLATS AND THE ASSESSEE WAS UNABLE TO FIND TENANTS FOR THE REMAINING 13 FLATS. THE AUTHORITIES BELOW FAILED TO APPRECIATE THAT HAD TH E ASSESSEE NOT GIVEN THESE 4 FLATS ON RENT, IT WOULD HAVE BEEN ENTITLED TO VACANCY AL LOWANCE AND THERE WOULD BE NO INCOME IN RESPECT OF THESE 4 FLATS FROM 1.1.2006 T O 31.3.2006. THUS, THE INTENTION WAS NOT TO HELP THE SISTER CONCERN PCS TECHNOLOGY L TD. BY CHARGING LOWER RENT BUT TO EARN WHATEVER INCOME POSSIBLE FROM THESE PROPERT IES AND TO SAFEGUARD THE INTEREST IN THE PROPERTY. HE SUBMITTED THAT THE A UTHORITIES BELOW FAILED TO APPRECIATE THAT VACANCY ALLOWANCE IS AUTOMATICALLY ALLOWED FOR THE VACANCY PERIOD FROM 1.1.2006 TO 31.3.2006 IN RESPECT OF OTHER 13 F LATS. THUS, THE SAID 4 FLATS DID NOT REMAIN RENTED PROPERTIES DURING THE INTERVENING PERIOD FROM 1.7.2005 TO 31.12.2005 AND THEY WERE VACANT DURING THIS PERIOD. HE SUBMITTED THAT THE RENT IS RECEIVED FOR 6 MONTHS AND ACTUALLY RENT RECEIVED HA S TO BE CONSIDERED FOR COMPUTING INCOME FROM HOUSE PROPERTY AS PER THE PROVISIONS OF SECTION 23(1)(C ) AND NOT AS PER SECTION 23(1)(A). THE LD. A.R. PLACED RELIANCE ON THE FOLLOWING DECISIONS : 1. K.P. VARGHESE, 131 ITR 597 (SC) 2. A. RAMAN & COMPANY, 67 ITR 11 (SC) 3. VIJAY MUKUND ATHAVALE VS. DCIT, ITA NO. 635/PN/2008 (A.Y. 2004-05) VIDE ORDER DATED 18 TH JUNE 2010. 4. PREMSUDHA EXPORTS (P) LTD. VS. ACIT (2008), 110 ITD 158 (MUM) 7. THE LD. D.R., ON THE OTHER HAND, TRIED TO JUSTIFY T HE ORDERS OF THE AUTHORITY BELOW. ITA . NO 1440/PN/2009 PCS FINANCE LTD., A.Y. 2006-07 PAGE OF 8 6 8. CONSIDERING THE ABOVE SUBMISSIONS, WE FIND THAT SIN CE BEGINNING, IT REMAINED CONTENTION OF THE ASSESSEE THAT THE ABOVE STATED 4 FLATS WERE SURRENDERED BY THE TENANT PCS VIDE THEIR LETTER DATED 28.11.2005 (SAMP LE LETTER MADE AVAILABLE AT PAGE NOS. 9 & 16 OF THE PAPER BOOK) MAKING IT CLEAR THAT THEY HAD DISCONTINUED THE USE OF THE PROPERTY W.E.F. 1.7.2005 AND THEY DID NOT PA Y RENT FROM THAT DATE UPTO 31 ST DECEMBER 2005 TILL WHICH DATE LEAVE AND LICENSE AG REEMENT WAS EFFECTIVE. THE 4 FLATS REFERRED TO ABOVE AND 15 OTHER FLATS WERE GI VEN ON RENT TO PCS SINCE JANUARY 2000. THE LAST LEAVE AND LICENSE AGREEMENT WAS EFF ECTIVE UPTO 31 ST DECEMBER 2005. OUT OF THE REMAINING 15 FLATS, IN RESPECT OF 13 OTH ER FLATS AT MUMBAI, PCS HAD ISSUED A FORMAL LETTER IN RESPECT OF ALL THE FLATS STATIN G THAT THE AGREEMENTS EXPIRED ON 31 ST DECEMBER 2005 AND THEY DID NOT WISH TO RENEW THE SAID ARRANGEMENTS. THE FACT OF NON-USER OF THESE FLATS AND NON-PAYMENT OF RENT I N RESPECT THEREOF FROM JULY 2005, IS MENTIONED IN THE LETTER IN RESPECT OF THE ABOV E 4 FLATS ONLY AND NOT IN THE LETTERS IN RELATION TO OTHER FLATS. HAVING GONE THROUGH TH E CONTENTS OF THESE LETTERS DATED NOVEMBER 28, 2005, SOME OF WHICH HAVE BEEN PLACED A T PAGE NO.9 , AND 16 OF THE PAPER BOOK, WE FIND THAT THE CONTENTS OF THESE LETT ERS ARE CONTRADICTORY. IN PARA NO. 3, IT MENTIONS AS EARLIER IN JUNE, 2005, WE HAD INTIMATED TO YOU THAT THE SAI D PREMISES WERE NO LONGER IN OUR USE AND ACCORDINGLY, W.E.F. JULY 2005, WE HAVE STOPPED PAYING THE RENT IN RESPECT OF THE SAID PREM ISES. WHEREAS IN PARA NO. 2, IT MENTIONS AS THE TERM OF THE SAID AGREEMENT IS UPTO DECEMBER 31, 2005. AS WE NO LONGER REQUIRE THE SAID PREMISES REFERRED UNDER T HE SAID AGREEMENT, WE, SHALL HAND OVER VACANT AND PEACEFUL POSSESSION OF THE ABOVE FL AT ON EXPIRY OF THE TERM ON JANUARY 1, 2006 TO YOUR AUTHORIZED REPRESENTATIVE. ON THE BASIS OF ABOVE CONTENTS OF THE LETTER, THE AUTHORITIES BELOW DID NOT AGREE WITH THE CONTENTION OF THE ASSESSEE THAT THE ABOVE STATED 4 FLATS WERE VACANT FROM JULY 2005 TILL DECEMBER 2005. 9. THE CONTENTION OF THE LD. A.R. BEFORE US IN THIS RE GARD REMAINED THAT THE FORMAL HANDING OVER OF THE POSSESSION WAS KEPT IN A BEYANCE TILL THE REFUND OF THE DEPOSIT SINCE THIS WAS DONE FOR ALL THE 17 FLATS CO LLECTIVELY. IT WAS POINTED OUT THAT ITA . NO 1440/PN/2009 PCS FINANCE LTD., A.Y. 2006-07 PAGE OF 8 7 THE DEPOSITS WERE REFUNDED ON 3.2.2006. THE LD. A .R. ALSO TRIED TO DEFINE THE WORD VACANT AS PER THE LAW LEXICON AS UN-FILLED, EMPTY , UNOCCUPIED. HE ALSO TRIED TO DEFINE THE WORD UNOCCUPIED AS PER ORDER 20, RULE 8 OF CIVIL PROCEDURE CODE & ARTICLE 89(2) OF THE CONSTITUTION OF INDIA. HE SUB MITTED THAT WORD VACANT USED IN THE ACT MEANS THAT THE TENANTS SHOULD HAVE CEASED T O OCCUPY THE ACCOMMODATION WITH THE INTENTION OF NOT COMING BACK TO IT AGAIN. THE ABOVE FACTS INDICATE THAT THE ABOVE REFERRED 4 FLATS WERE VACANT FROM JULY 2005 IN A SENSE THAT THE TENANT WAS NOT INTENDED TO LOSE THE PREMISES BUT HANDING OVER THE POSSESSION WAS KEPT IN ABEYANCE TILL THE REFUND OF DEPOSITS SINCE IT WAS T O BE DONE FOR ALL THE 17 FLATS COLLECTIVELY. IN OTHER WORDS, IN OUR VIEW, THOSE FLATS WERE NOT AVAILABLE WITH THE ASSESSEE TO LET IT OUT. THUS, WE ARE NOT INCLINED TO AGREE WITH THIS SUBMISSION OF THE LD. A.R. THAT THESE FLATS WERE VACANT. UNDER THESE CIRCUMSTANCES, WE CONCUR WITH THE APPROACH OF THE AUTHORITIES BELOW THAT THE TENA NT WAS STILL IN POSSESSION OF THE FLAT UPTO 31 ST DECEMBER 2005 AND THUS, THE A.O HAS RIGHTLY COMPUT ED THE RENT THEREOF UPTO 31 ST DECEMBER 2005. SINCE THE ABOVE FLATS WERE NOT VAC ANT, DURING THE PERIOD JULY 2005 TO DECEMBER 2005 AND IT IS NOT TH E CASE OF THE ASSESSEE THAT THESE PREMISES WERE LET OUT ON HIGHER RENT, THE EXPLANATI ON OF THE ASSESSEE CANNOT BE ACCEPTED THAT THESE FLATS WERE LET OUT FOR THE PERI OD 1.1.2006 TO 31 ST MARCH 2006 ON DECREASED RENT AS SUITABLE TENANTS WERE NOT AVAILAB LE. THUS, THERE IS NO QUESTION OF APPLICATION OF THE PROVISION OF SECTION 23(1)(C ) O F THE ACT AS PLEADED BY THE LD. A.R. THE A.O THUS HAS RIGHTLY APPLIED THE PROVISION OF SECTION 23(1)(A) OF THE ACT FOR COMPUTING THE RENT FOR THIS PERIOD. WE THUS DO NOT FIND REASON TO INTERFERE WITH THE ORDERS OF THE AUTHORITIES BELOW IN THIS REGARD. TH E SAME IS UPHELD. THE DECISIONS RELIED UPON BY THE LD. A.R. ARE NOT HELPFUL TO THE ASSESSEE AS THEY ARE HAVING DISTINGUISHABLE FACTS. IN THE CASE OF PREMSUDHA E XPORTS (P) LTD. VS. ACIT (SUPRA), AS PER THE RESOLUTION OF THE BOARD OF DIRECTORS OF ASSESSEE COMPANY AND VARIOUS CORRESPONDENCE PLACED ON RECORD, IT WAS SHOWN THAT THE PROPERTY IN QUESTION WAS INDICATED TO BE LET OUT AND DESPITE EFFORTS MADE, IT REMAINED VACANT FOR THE WHOLE OF THE RELEVANT PREVIOUS YEAR. SIMILAR WAS THE POS ITION IN THE CASE OF VIJAY MUKUND ITA . NO 1440/PN/2009 PCS FINANCE LTD., A.Y. 2006-07 PAGE OF 8 8 ATHAVALE VS. DCIT (SUPRA) WHERE RENTED PROPERTY REM AINED VACANT FOR THE WHOLE YEAR. THE ISSUES RAISED IN THE GROUNDS REGARDING T HE VALIDITY OF APPLICATION OF NOTIONAL INCOME AND THE PROVISIONS OF SECTION 23(1) (A ) OF THE ACT ARE THUS DECIDED IN FAVOUR OF THE REVENUE. THE FIRST APPELLATE ORD ER ON THIS ISSUE IS THUS UPHELD. THE RELATED GROUNDS ARE ACCORDINGLY REJECTED. 10. IN RESULT, APPEAL IS DISMISSED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 14TH OCTOBER, 2011 SD/- SD/- ( G.S. PANNU ) ACCOUNTANT MEMBER (I.C. SUDHIR ) JUDICIAL MEMBER PUNE, DATED THE 14TH OCTOBER, 2011 US COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT -II, PUNE 4. THE CIT(A)-II, PUNE 5. THE D.R. B BENCH, PUNE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE