The DCIT, Circle-12, Ahmedabad V. Smt. Parvatiben P.Sukhadia, Ahmedabad

ITA 1805/AHD/2010

• Counselvise Citation: 180520514 RSA 2010
• Duration Of Justice: 1 year(s) 11 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-05-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 21-05-2012
• Assessment Year: 2007-2008
• Appeal Filed On: 26-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P TALATI
• Assessee Lawyers: JASWANT C SHAH
• Keywords: Earning of tax free income; Cost of acquisition; Revised return
• Section: 69C; 143(3); 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD B BENCH BEFORE: SHRI D.K. TYAGI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTAN T MEMBER I.T.A. NO.1805/AHD/2010 A. Y. 2007-08 DY. COMMISSIONER OF INCOME TAX, CIRCLE-12 AHMEDABAD APPELLANT VS. SMT. PARVATIBEN P SUKHADIA 9, PRAGATI ESTATE, GUJARAT BOTTLING ROAD, RAKHIAL, AHMEDABAD PAN-AFQPS1848K RESPONDENT WITH C.O. NO.211/AHD/2010 (ARISING OUT OF ITA NO.1805/AHD/2010) DEPARTMENT BY : SHRI S.P. TALATI, SR. D.R. ASSESSEE BY : SHRI JASWANT C. SHAH, A.R. DATE OF HEARING : 21.05.2012 DATE OF PRONOUNCEMENT : 25.05.2012 / ORDER PER : D.K. TYAGI, JUDICIAL MEMBER THIS IS REVENUES APPEAL AGAINST THE ORDER OF LD. C IT(A)-XX, AHMEDABAD DATED 15.02.2010, PASSED IN APPEAL NO.CIT (A)-XX/160/2009- 10. 2. THE REVENUE HAS TAKEN FOLLOWING GROUNDS OF APPE AL:- ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 2 1. THE LD. CIT(A)-XX, AHMEDABAD HAS ERRED IN LAW A ND ON FACTS IN DELETING THE ADDITION OF RS.2,70,000/- MADE BY THE AO U/S. OF THE ACT ON ACCOUNT OF LOW HOUSEHOLD EXPE NSES, WITHOUT PROPERLY APPRECIATING THE FACTS OF THE CASE AND THE MATERIAL BROUGHT ON RECORD BY THE AO. 2. THE LD. CIT(A)-XX, AHMEDABAD HAS ERRED IN LAW AN D ON FACTS IN DELETING THE ADDITION OF RS.5,17,120/- MADE BY THE AO ON ACCOUNT OF PROPERTY INCOME, WITHOUT PROPERLY APPRECIATING THE FACTS OF THE CASE AND THE MATERIAL BROUGHT ON RECORD BY THE A.O. 3. IN DOING SO, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN NOT APPRECIATING THAT THE ASSESSEE OWNED T WO PROPERTIES OUT OF WHICH ONE WAS USED FOR RESIDENTIA L PURPOSE AND THE OTHER REMAINED VACANT DURING THE YEAR AND T HEREFORE THE ALV OF THE PROPERTY OTHER THAN THAT OCCUPIED BY THE ASSESSEE WAS RIGHTLY DETERMINED U/S 23(1)(A) R.W.S. 23(4)(B) OF THE ACT, BY THE A.O. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) OUGHT OF AO BE RESTORED TO THE ABOVE EXT ENT. 3. GROUND NO.3 AND 4 ARE GENERAL IN NATURE HENCE R EQUIRE NO ADJUDICATION. 4. GROUND NO.1 RELATES TO ADDITION OF RS.2,70,000/ - MADE BY THE A.O. U/S 69 C OF THE ACT ON ACCOUNT OF LOW HOUSEHOL D EXPENSES. WHILE MAKING THIS ADDITION THE A.O. HAS OBSERVED AS UNDER :- ..AFTER GOING THROUGH THE REPLY FILED IT IS SEEN THAT ONLY RS.2,70,000/- HAS BEEN WITHDRAWN FOR MEETING T HE HOUSEHOLD EXPENSES OF THE ENTIRE FAMILY. IT IS IMP OSSIBLE TO BELIEVE THAT THEASSESSEE HAD NOT MADE ANY EXPENDITU RE FOR PERSONAL TRAVEL, HOLIDAY EXPS., PURCHASE OF JEWELLE RY & VALUABLE ITEMS, NO EXPENDITURE INCURRED ON FUNCTION S, CEREMONIES, ENTERTAINMENT OR OTHER EVENTS OR SERVAN T EXPENSES DURING THE YEAR AND IS ALSO NOT USING A MO BILE PHONE. THUS, IT IS SEEN THAT EVERY MONTH FOR THE ENTIRE FA MILY OF 9 MEMBERS (WHICH INCLUDE THREE SCHOOL GOING CHILDREN) WITHDRAWALS OF RS.2,70,000/- IN ALL IS MADE FOR MEE TING THE HOUSEHOLD EXPENSES. IT IS FURTHER SEEN FROM THE CO PY OF ACCOUNTS FILED THAT NO SEPARATE WITHDRAWALS HAVE BE EN MADE FOR MEETING OTHER EXPENSES LIKE ELECTRICITY EXPENSE S, EDUCATION EXPENSES OF THE CHILDREN WHO ARE ALL STUDYING IN A PROMINENT ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 3 SCHOOL OF THE CITY, ENTERTAINMENT EXPENSES, PERSONA L TRAVEL AND HOLIDAY EXPENSES, EXPENSES ON SERVANTS, BUYING OF P ERSONAL ITEMS, ETC. IT IS STATED THAT ALL THESE EXPENSES A RE MET FROM THE WITHDRAWALS MADE FOR HOUSEHOLD EXPENSES. THE RETURN OF INCOME OF THE ASSESSEE SHOWS THAT THE ASSESSEE HAS EARNED EXEMPT INCOME OF RS.19,18,831/- . THE INCOME AND EXPENDITURE ACCOUNT SHOWS RECEIPT OF INC OME RS.10,71,300/- AND INCOME OF RS.10,70,800/- HAS BEE N TRANSFERRED TO HER CAPITAL ACCOUNT. HER CAPITAL AS ON 31-03- 2007 IS RS.3,59,64,255/- WHICH ARE INVESTED IN VARI OUS ASSETS INCLUDING A BUNGLOW RS.87,87,351/- AND A FARM HOUSE . SIMILAR IS THE POSITION IN THE CASES OF HER HUSBAND AND SON WHO ARE WITHDRAWING CASH FOR MEETING THE HOUSE. IT IS IMPOSSIBLE TO BELIEVE THAT THE ASSESSEE WOULD NOT INCUR ANY EXPENDITURE ON THE ITEMS MENTIONED ABOVE, IN VIEW OF THE FACTS STATED ABOVE AND THE STANDING OF THE A SSESSEE IN THE SOCIAL CIRCLE. THE WITHDRAWALS MADE FOR MEETIN G HOUSEHOLD EXPENSES IS THEREFORE HELD TO BE ON THE LOWER SIDE. THE ACTUAL WITHDRAWAL MADE WORKS OUT TO RS.2,500/- PER FAMILY MEMBER PER MONTH WHICH VERY MUCH ON THE LOWER SIDE. CONSI DERING THE SOCIAL STANDING OF THE ASSESSEE AND THE INCOME EARN ED (BOTH EXEMPT AND TAXABLE) BY THE ENTIRE FAMILY IT WOULD B OTH FAIR AND REASONABLE TO AT LEAST ESTIMATE THE WITHDRAWAL FOR HOUSEHOLD EXPENSES AT RS.5,000/- PER MONTH FOR EACH FAMILY ME MBER. THE TOTAL WITHDRAWAL FOR THE ENTIRE FAMILY PER MONT H THEREFORE WORKS OUT TO RS.45,000/- WHICH IS VERY FAIR AND REA SONABLE. THE YEARLY HOUSEHOLD EXPENSES WOULD THEREFORE BE WO RKOUT TO RS.5,40,000/-. THE DIFFERENCE OF RS.2,70,000/- WOU LD THEREFORE BE EXPENDITURE COVERED BY S.69COF THE I.T . ACT. ADDITION OF RS.2,70,000/- IS THEREFORE MADE AND INC LUDED IN THE TOTAL INCOME COMPUTATION. THE ADDITION OF RS.2,70,000/- U/S 69C IS JUSTIFIED BECAUSE IT HAS BEEN HELD THAT SECTION 69C IS CLARIFICATORY IN NATURE AND EMBODIES A RULE OF EVIDENCE WHICH IS EVEN OTHERWISE QUITE CLEAR (126 ITR 48). IN THE NATURE OF THINGS WHEN AN ESTI MATE IS REQUIRED TO BE MADE IN THE ABSENCE OF PROPER RECORD MAINTAINED WHEN AN ESTIMATE IS REQUIRED TO BE MADE IN THE ABSENCE OF A PROPER RECORD MAINTAINED IN THAT RESPE CT, PROBABILITIES CANNOT ALTOGETHER BE EXCLUDED FROM CO NSIDERATION (149 ITR 383). BASICALLY, THE EXACT EXPENDITURE OR EVEN A PROPER ESTIMATE OF EXPENDITURE WOULD ONLY BE IN THE KNOWLEDGE OF THE ASSESSEE. IF THE ASSESSEE CHOOSES TO GIVE E VASIVE ANSWERS, THEN THE ITO CAN DRAW AN ADVERSE INFERENCE REGARDING THE SUPPRESSION OF MATERIAL FACTS (149 IT R 533). FURTHER, SUPPORT FOR MAKING THE ADDITION U/S 69C FO R LOW AND INADEQUATE WITHDRAWALS MADE BY THE ASSESSEE FOR MEE TING HER HOUSE HOLD EXPENSES IS DERIVED FROM THE FOLLOWING D ECISIONS. ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 4 1. 80 TTJ (AHD) 69 SHANKERLAL NEBHUMAL(HUF) 2. 90 TAXMAN 165 (AHD) RANCHHODBHAI PATEL 3. 9 TTJ 539 (AHD) B. V. SHAH 4. 58 TTJ 340 (DEL) ANILKUMAR 5. 40 TTJ 462 (DEL) RAMASWARUP SABHARWAL 6. 15 TTJ 567 B.L. RAI 7. 17 TTJ (JP) 231 RAMSING 8. 51 TTJ 436 (JP) SHYAMSUNEDER GUPTA 9. 22 TTJ 547 (DEL) GEETAKUMARI GUPTA. 5. IN APPEAL LD. CIT(A) HAS DELETED THIS ADDITION BY FOLLOWING THE DECISION OF HONBLE ITAT IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2006-07. AGGRIEVED BY THIS ORDER OF LD. CIT(A) NOW THE REVENUE IS IN APPEAL BEFORE US. 6. AFTER HEARING BOTH THE PARTIES, WE FIND THAT ON SIMILAR FACTS AND CIRCUMSTANCES ADDITION OF RS.2,30,000/- WAS MADE BY THE A.O. IN ASSESSMENT YEAR 2006-07. THE HONBLE ITAT VIDE ITS ORDER DATED 09.10.2009 IN ITA NO.1732/AHD/2009 DECIDED THE MATT ER IN FAVOUR OF THE ASSESSEE BY OBSERVING AS UNDER:- WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CONSIDERED THE SAME. WE NOTED THAT NO EVIDENCE WAS BROUGHT ON RECORD BY THE REVENUE WHICH MAY PROVE THAT THE A SSESSEE HAS INCURRED EXPENSES ON THE HOUSEHOLD DRAWING MUCH MORE THAN WHAT HAS BEEN SHOWN BY HER FAMILY MEMBERS. TH E HOUSEHOLD DRAWING HAS MERELY BEEN ESTIMATED BY THE AO WITHOUT POINTING OUT ANY SPECIFIC EXPENDITURE BEING INCURRED BY THE ASSESSEE. WE HAVE GONE THROUGH THE PROVISIONS OF SECTION 69C OF THE INCOME TAX ACT AND WE NOTED THAT THERE M UST BE EVIDENCE ON RECORD WHICH MAY PROVE THAT THE ASSESSE E HAD INCURRED EXPENSES MUCH MORE THAN WHAT HAS BEEN SHOW N BY THE FAMILY MEMBERS. IN CASE THE REVENUE GOT SHIFTE D TO THE ASSESSEE TO OFFER EXPLANATION ABOUT THE SOURCE OF S UCH EXPENSES TO THE SATISFACTION OF THE AO. APPARENT I S REAL ONUS IS ON THE PERSON WHO ALLEGES APPARENT IS NOT REAL. OU R AFORESAID VIEW IS DULY SUPPORTED BY THE DECISION OF THE HONB LE SUPREME COURT IN THE CASE OF CIT VS. DAULAT RAM RAWATMALL 8 7 ITR 349. EVEN SO EVIDENCE WAS BROUGHT TO OUR KNOWLEDGE BY TH E LEARNED ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 5 DR. WE ACCORDINGLY SET ASIDE THE ORDER OF THE CIT( A) AND DELETE THE ADDITION MADE BY THE AO. IN VIEW OF THE ABOVE, LD. CIT(A) HAS RIGHTLY DELETE D THIS ADDITION AND THE ORDER PASSED BY HIM IS HEREBY UPHELD. THIS GROUND OF REVENUE IS DISMISSED. 7. THE SECOND GROUND RELATES TO ADDITION OF RS.5,1 7,120/- MADE BY THE A.O. ON ACCOUNT OF PROPERTY INCOME. WHILE M AKING THIS ADDITION THE A.O. HAS OBSERVED AS UNDER:- ON VERIFICATION OF THE BALANCE SHEET IT IS SEEN TH AT THE ASSESSEE IS IN POSSESSION OF A BUNGLOW IN BEVERLY H ILL CO. SOCIETY LTD. WHEREIN SHE HAS INVESTED AN AMOUNT OF RS.82,08,277/-. IN HER REPLY DATED 18/5/2009 SHE H AS TWICE REPLIED THAT HER RESIDENTIAL ADDRESS IS TENAMENT NO .1, VRUNDAVAN COLONY, OPP. GHEVAR COMPLEX, B/H. RAJASTH AN HOSPITAL, SHAHIBAUG, AHMEDABAD. IT IS THE CASE OF THE ASSESSEE THAT SHE IS STAYING WITH THE ENTIRE FAMILY AT THE ABOVE MENTIONED ADDRESS FOR JUSTIFYING THE ADEQUACY OF TH E WITHDRAWALS MADE FOR MEETING THE HOUSEHOLD EXPENSES OF THE FAMILY. IN THE RETURN OF INCOME SHE HAS NOT SHOWN ANY INCOME FROM PROPERTY EITHER AS LET OUT PROPERTY OR SELF OC CUPIED PROPERTY. IN HER REPLY DATED 16/11/2009 THE ASSESS EE HAS STATED IN PARA-11 OF HER REPLY THAT I HAD NOT SHOW N S.O. PROPERTY INCOME DURING THE YEAR. THE S.O. PROPERTY WAS NOT COMPLETED IN THE ASS. YR. 2007-08. THIS STATEMENT OF THE ASSESSEE IS A FALSE STATEMENT AS IT IS AN ADMITTED POSITION THAT THE BUNGLOW WAS READY IN AY 2006-07 AND POSSESSION OF WHICH WAS TAKEN BY THE ASSESSEE IN AY 2006-07. WHEN THIS FACT WAS POINTED OUT TO THE ASSESSEE, THE ASSESSEE ADMITTED POSSESSION OF THE SAME IN HER LETTER DATED 2/12/2009 AND CLAIM ED THAT THE ANNUAL INCOME OF THE SAME (ALV) BE TAKEN AT RS.NIL AS THE BUNGLOW WAS TO BE TREATED AS A SELF OCCUPIED PROPER TY. THE CLAIM OF THE ASSESSEE IS NOT ACCEPTABLE AS IT IS NO T PERMITTED BY THE PROVISION OF SECTION 23(2) OF THE I.T. ACT. SE CTION 23(2)(A) IS NOT APPLICABLE AS THE BUNGLOW WAS NOT OCCUPIED A ND THE USE BY THE ASSESSEE OF HER OWN RESIDENCE AS IT IS AN AC CEPTED FACT THAT SHE WAS RESIDING AT TENEMENT NO.1 SHAHIBAUG WI TH HER ENTIRE FAMILY. SECTION 23(2)(B) IS ALSO NOT APPLICA BLE TO THE FACTS OF THE CASE OF THE ASSESSEE AS THE CONDITIONS LAID DOWN HAVE NOT BEEN SATISFIED BY THE ASSESSEE. HENCE THE CLAIM OF ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 6 THE ASSESSEE THAT THE ANNUAL VALUE OF THE BUNGLOW B E TAKEN AT NIL IS NOT ACCEPTABLE AS THE CASE OF THE ASSESSEE I S NOT COVERED BY SECTION 23(2) OF THE I.T. ACT. THE ANNUAL VALUE OF THE PROPERTY IS THEREFORE TO BE DETERMINED AS PER THE P ROVISIONS OF SECTION 23(1)(A) OF THE I.T. ACT. THE INVESTMENT M ADE IN THE PROPERTY IS RS.82,07,277/- AND APPLYING THE INTERES T PERCENTAGE OF 9% THE YIELD OF THE PROPERTY WORKS OU T TO RS.7,38,744/-. THE ANNUAL VALUE OF THE PROPERTY IS THEREFORE ADOPTED AT RS.7,38,744/-. THE ASSESSEE IS ENTITLED TO DEDUCTION U/S 24 OF RS.2,21,623/-. THE TAXABLE ANN UAL VALUE THEREFORE WORKS OUT TO RS.5,17,120/-. ACCORDINGLY, PROPERTY INCOME FROM THE BUNGLOW IS COMPUTED AT RS.5,17,120/ -. 8. IN APPEAL BEFORE LD. CIT(A) THE ASSESSEE RELIED ON THE FOLLOWING WRITTEN SUBMISSIONS:- 1. THE LD. DY. CIT, CIR.12, AHMEDABAD HAD ERRED TO ADD PROPERTY INCOME OF RS.5,17,120/- WITHOUT GENUINE BA SIS. 2. THE LD. DY. CIT, CIR.12, AHMEDABAD HAD APPLIED PROPERTY INCOME ON INTEREST PERCENTAGE OF 9% OF THE YIELD OF THE VALUE OF THE PROPERTY. THE INCOME-TAX ACT IS N OT RECOGNIZED ABOVE METHOD VALUATION OF PROPERTY INCOM E. 3. THE LD. DY. CIT, CIR.12, AHMEDABAD HAD NOT CONSIDERED MY LETTER 2/12/2009 FOR S.O. PROPERTY IN COME-AS NIL INCOME. SECTION 23(4) OF THE INCOME-TAX ACT, 1961 GIVES OPTION TO THE ASSESSEE TO OPT FOR S.O. PROPERTY INC OME FOR ONE PROPERTY. THE LD. DY. CIT, CIR.12, AHMEDABAD HAD N O RIGHT TO ABOVE MATTER. HE HAD NOT CONSIDERED ABOVE OPTIONS AS PER I.T. ACT, 1961 OF THE RIGHT OF THE ASSESSEE. 4. THE LD. DY. CIT, CIR.12, AHMEDABAD HAS NOT CONSIDERED OF REVISED RETURN OF INCOME FOR THE AY 2 007-08 FOR S.O. PROPERTY INCOME AS NIL INCOME WITH EXPLANATION LETTER DATED 7/12/2009 BY SPEED POST VOLUNTARILY. THE ASS ESSMENT ORDER U/S. 143(3) WAS POSTED BY REGISTERED AD ON 12 /12/2009 AND RECEIVED BY ME ON 14/12/2009. 5. THE LD. DY. CIT, CIR.12 HAD ERRED TO NOT CONSIDE RED RENT CONTROL ACT THAT RENT CANNOT EXCEED THE STANDA RD RENT. DECISION OF SUPREME COURT-SMT. SHEELA KAUSHIS VS. C IT (131 ITR 435)(SC). 6. THE LD. DY. CIT, CIR.12 HAD NOT CONSIDERED THE MUNICIPAL TAX BILL OF USES OF ABOVE PROPERTY AS S ELF RESIDENCE PROPERTY BUT HE HAD CONSIDERED AS RENTED PROPERTY. IT IS MY SELF OCCUPIED PROPERTY ONLY. SO IT SHOULD BE ALV RS. NIL INCOME ONLY. ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 7 7. THE LD. DY. CIT, CIR.12 HAD ERRED TO MAKE ADDI TION U/S 23(1)(A) FOR RS.5,17,120/- AS PROPERTY INCOME O F THE IT ACT 1961 WITHOUT ISSUING ANY NOTICES TO ME. SO ADDITIO N U/S.23(1)(A) MADE IS ILLEGAL, BAD IN LAW AND VOID A B INITIO. SO ADDITION OF RS.5,17,120/- FOR PROPERTY INCOME IS TO BE DELETED IN TOTO. 9. AFTER TAKING INTO CONSIDERATION THE ABOVE SUBMI SSIONS OF THE ASSESSEE LD. CIT(A) DELETED THE ADDITION BY OBSERVI NG AS UNDER:- I HAVE CONSIDERED THE FACTS OF THE CASE, OBSERVATI ON OF THE AO IN THE ASSESSMENT ORDER, SUBMISSION MADE BY THE APPELLANT AND CASE LAWS RELIED UPON BY THE APPELLAN T. THE ADDITION OF RS.5,17,120/- MADE ON ACCOUNT OF HOUSE PROPERTY AT BEVERLY HILL CO. SOCIETY LTD., AHMEDABAD HAS BEE N MADE BY THE AO BY TAKING THE COST OF ACQUISITION OF RS.82,0 7,277/- AND CALCULATING 9% YIELD OF THE PROPERTY AT RS.7,38,744 /- AND THEREAFTER ALLOWING DEDUCTION OF RS.2,21,623/- U/S 24 OF THE ACT. FROM THE DETAILS FILED BEFORE ME, I FIND THAT APPELLANT IS THE SOLE OWNER OF THE PROPERTY. THE APPELLANT IN S UPPORT OF HER CONTENTION HAS FURNISHED THE MUNICIPAL BILL FOR THE FINANCIAL YEARS 2006-07, 2007-08 AND 2008-09 TO SHOW THAT SHE WAS THE SOLE OWNER AND IT WAS HER SELF-OCCUPIED PROPERT Y. THE APPELLANT WAS NOT LIVING IN THIS PROPERTY DUE TO IN CONVENIENCE BUT IT WAS USED OCCASIONALLY BY HER SON FOR NIGHT R EST. TO SUPPORT THIS CONTENTION, THE APPELLANT HAS RELIED O N THE JUDGMENT DELIVERED IN THE CASE OF SMT. SHEELA KAUSH S VS. CIT REPORTED AT 131 ITR 435 (SC). THE ALV OF A PROPERTY WOULD BE NIL AS PER CLAUSE (C) OF SUB SECTION (1) OF SEC.23. BUT, A FINDING HAS TO BE GIVEN UNDER WHAT CIRCUMSTANCES TH E PROPERTY FALLS IN THE RELEVANT PREVIOUS YEAR. TO ATTRACT CL AUSE (C) OF RELEVANT SECTION, IT HAS TO BE SHOWN THAT THE PROPE RTY WAS INTENDED TO BE LET, BUT REMAINED VACANT DUE TO CIRC UMSTANCES NOT IN THE CONTROL OF THE OWNER. CLAUSE (C) WILL N OT COVER CASES WHERE THE HOUSE PROPERTY IS MAINTAINED BY THE ASSES SEE FOR SELF USE OR FOR OTHER USE AND HAS NO INTENTION WHAT SOEVER TO LET OUT THE PROPERTY TO EARN RENT THEREFROM. IT IS ALS O NECESSARY TO SEE THE POSITION OF THE PROPERTY IN THE PRECEDING A S WELL AS IN THE SUBSEQUENT ASSESSMENT YEAR. THE AFORESAID CLAU SE WOULD NOT BE APPLICABLE TO PROPERTIES, WHICH ARE VACANT B UT UNDER THE LAW WOULD BE DEEMED TO BE UNDER SELF-OCCUPATION. O WNERS INTENTION NOT TO LET OUT THE PROPERTY IS A MATERIAL FACTOR. FROM THE ASSESSMENT ORDER, IT IS EVIDENT THAT THE AO DID NOT EXAMINE THE ISSUE FROM PROPER PERSPECTIVE. DETAILED FACTS ARE NOT RECORDED TO SHOW WHETHER THE PROPERTY WAS A LET OUT PROPERTY ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 8 OR IT WAS NEVER INTENDED TO BE LET OUT AND WAS A SE LF-OCCUPIED PROPERTY. IN VIEW OF THE ABOVE, IT IS VERY CLEAR T HAT THE ABOVE PROPERTY WAS VACANT BUT WAS COVERED U/S 23(2) OF TH E ACT. THEREFORE, THE ADDITION OF RS.5,17,120/- MADE BY TH E A.O. IS HEREBY DIRECTED TO BE DELETED. AGGRIEVED BY THIS ORDER OF LD. CIT(A) NOW THE REVEN UE IS IN APPEAL BEFORE US. 10. AT THE TIME OF HEARING LD. D.R. VEHEMENTLY SUP PORTING THE ORDER OF THE A.O. SUBMITTED THAT LD. CIT(A) HAS FAI LED TO APPRECIATE THE FACT THAT THE ASSESSEE OWN TWO PROPERTIES OUT OF WHICH O NE WAS USED FOR RESIDENTIAL PURPOSE AND THE OTHER REMAINED VACANT D URING THE YEAR UNDER APPEAL AND THEREFORE, ALV OF THE PROPERTY OTHER THA N OCCUPIED BY ASSESSEE HAS RIGHTLY BEEN DETERMINED U/S 23(1)(A) READ WITH SECTION 23(4)(B) OF THE ACT BY THE A.O. HE, THEREFORE, PRAYED THAT ORDER P ASSED BY LD. CIT(A) MAY KINDLY BE SET ASIDE AND THAT OF THE A.O. BE RESTORE D. LD. COUNSEL OF THE ASSESSEE, ON THE OTHER HAND, REBUTTED THIS SUBMISSI ON OF LD. D.R. BY SAYING THAT DURING THE YEAR UNDER APPEAL ASSESSEE OWNED ON LY ONE PROPERTY I.E. BEVERLY HILL CO. SOCIETY LTD., AHMEDABAD AND THE OTHER PROPERTY TENAMENT NO.1, VRUNDAVAN COLONY, OPP. GHEVAR COMPLE X, B/H. RAJASTHAN HOSPITAL, SHAHIBAUG, AHMEDABAD IS OWNED BY HER HUS BAND AND THEREFORE THE PROVISIONS OF SECTION 23(4)(B) OF THE ACT ARE N OT ATTRACTED TO THE FACTS OF THIS CASE AND LD. CIT(A) HAS RIGHTLY TAKEN THE A NNUAL ALV OF THIS PROPERTY AS NIL AS PER SECTION 23(2) OF THE ACT. HE, THEREF ORE, PRAYED THAT THE ORDER PASSED BY LD. CIT(A) MAY KINDLY BE UPHELD. 11. HEARD BOTH PARTIES AND PERUSED THE RECORD. WE FIND THAT AN ADDITION OF RS.5,17,120/- HAS BEEN MADE BY THE A.O. IN THIS CASE BY ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 9 INVOKING THE PROVISIONS OF SECTION 23(4)(B) OF THE ACT ASSUMING THAT THE ASSESSEE WAS OWNER OF TWO PROPERTIES DURING THE YEA R UNDER APPEAL. THE ASSESSEES CONTENTION HAS CONSISTENTLY BEEN THAT SH E WAS OWNER OF ONLY ONE PROPERTY WHICH WAS VACANT DURING THE YEAR UNDER APPEAL AS THE SAME WAS NOT LET OUT DURING THE YEAR AND OTHER PROPERTY BELONGS TO HER HUSBAND. THIS FACT IS BORN OUT BY THE WRITTEN SUBMISSIONS FI LED BY THE ASSESSEE ON 2 ND DECEMBER, 2009 BEFORE THE A.O. WHEREIN IT WAS CLEAR LY MENTIONED THAT THE OTHER PROPERTY IS OWNED BY HER HUSBAND. WE HAVE AL SO GONE THROUGH THE PAPERS FILED BY THE ASSESSEE IN SUPPORT OF THIS SUB MISSION IN THE FORM OF MUNICIPAL TAX RECEIPTS IN THE NAME OF HER HUSBAND A ND THE COMPUTATION OF INCOME FILED ALONG WITH RETURN OF INCOME BY HER HUS BAND TO SHOW THAT THE OTHER PROPERTY AT TENAMENT NO.1, VRUNDAVAN COLONY, OPP. GHEVAR COMPLEX, B/H. RAJASTHAN HOSPITAL, SHAHIBAUG, AHMEDA BAD WAS SELF ACQUIRED PROPERTY OF HER HUSBAND. WE FURTHER FIND THAT THE A.O. HAS NOT BROUGHT ANY MATERIAL ON RECORD TO SHOW THAT THE PRO PERTY OWNED BY ASSESSEE WAS EVER LET OUT BY THE ASSESSEE DURING TH E YEAR UNDER APPEAL OR IT WAS INTENDED TO BE LET OUT. SINCE THE SAME HAS NOT BEEN DONE AND THE PROPERTY REMAINING VACANT DURING THE YEAR UNDER APP EAL, LD. CIT(A) HAS RIGHTLY GIVEN RELIEF TO THE ASSESSEE AS THE ASSESSE ES CASE IS COVERED BY THE PROVISIONS OF SECTION 23(2) OF THE ACT. THE ORDER PASSED BY LD. CIT(A) IS, THEREFORE, UPHELD. 12. IN THE RESULT, THE REVENUE APPEAL IS DISMISSED . 13. NOW COMING TO THE C.O. FILED BY THE ASSESSEE. WE FIND THAT THIS IS IN SUPPORT OF THE ORDER PASSED BY LD. CIT(A ). IN VIEW OF OUR DECISION ITA NO.1805/AHD/2010 , A.Y. 2007-08 WITH C.O. NO.211/2010 10 IN REVENUES APPEAL, IT HAS BECOME INFRUCTUOUS AND THE SAME IS HEREBY DISMISSED AS INFRUCTUOUS. 14. IN THE RESULT, BOTH, THE REVENUES APPEAL AS W ELL AS THE C.O. OF THE ASSESSEE ARE DISMISSED. ORDER WAS PRONOUNCED IN OPEN COURT ON 25.05. 2012 SD/- SD/- (A. MOHAN ALANKAMONY) ( D.K. TYAGI) ACCOUNTANT MEMBER JUDICIAL MEMBER TRUE COPY N.K. CHAUDHARY, SR. P.S. / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. / CONCERNED CIT 4. - / CIT (A) 5. ! , ' , #$ / DR, ITAT, AHMEDABAD 6. %& '( / GUARD FILE. BY ORDER/ , ) / # * ' , #$ +