Subhash Basu, Kolkata V. ACIT, Circle - 19, Kolkata, Kolkata

ITA 1904/KOL/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 62121 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 8 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-06-2012
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 03-02-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 08-10-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B K DAS
• Assessee Lawyers: SOUMITRA CHOW DHURY
• Section: 143(3)

Judgement Text

, SMC(C) , IN THE INCOME TAX APPELLATE TRIBUNAL SMC(C) BENCH: KOLKATA () BEFORE , [BEFORE SHRI MAHAVIR SINGH, JM] / I.T.A NO. 1904/KOL/2010 !' !' !' !'/ // / ASSESSMENT YEAR: 2005-06 SUBHASH BASU VS. ASSISTANT COMMISSIONER OF IN COME-TAX, (PAN: AEAPB1463Q) CIRCLE-19, KOLKATA ($% /APPELLANT ) (&'$%/ RESPONDENT ) DATE OF HEARING: 19.06.2012 DATE OF PRONOUNCEMENT: 19.06.2012 FOR THE APPELLANT: SHRI SOUMITRA CHOWDHURY FOR THE RESPONDENT: SHRI B. K. DAS () / ORDER IMMEDIATELY UPON CONCLUSION OF HEARING OF THIS APPE AL ON 19 TH JUNE, 2012, THE BENCH PASSED THE FOLLOWING ORDER: 19 TH JUNE, 2012 ASSESSEES APPEAL IS PARTLY ALLOWED AND DIRECTED AO TO RECOMPUTE ALV IN TERMS OF MUNICIPAL TAX LEVIED. ORDER PRONOU NCED IN OPEN COURT. DETAILED ORDER WILL FOLLOW. THIS APPEAL BY ASSESSEE IS ARISING OUT OF ORDER OF CIT(A)-XIII, KOLKATA IN APPEAL NO. 66/CIT(A)-XIII/CIR-19/07-08 DATED 17.06.2010. ASSE SSMENT WAS FRAMED BY ACIT, CIRCLE-19, KOLKATA U/S. 143(3) OF THE INCOME-TAX ACT, 1961 (HE REINAFTER REFERRED TO AS THE ACT) FOR AY 2005-06 VIDE HIS ORDER DATED 17.12.2007. 2. THE ONLY ISSUE IN THIS APPEAL OF ASSESSEE IS AGA INST THE ORDER OF CIT(A) CONFIRMING THE ADDITION OF DEEMED ANNUAL VALUE OF ONE RESIDENTIAL FLAT OUT OF TWO RESIDENTIAL FLATS OCCUPIED BY ASSESSEE IN THE SAME SOCIETY. FOR THIS, ASSESSEE H AS RAISED FOLLOWING GROUND NO.1: 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THDE CAS E THE LD. CIT(A)-XIII/KOL HAS FAILED TO ASCERTAIN THE FACT AND RELEVANT LAW ON AN ADDITI ON OF RS.41,256/- TOWARDS DEEMED ANNUAL VALUE OF ONE RESIDENTIAL FLAT OUT OF TWO FLA TS IN POSSESSION OF YOUR APPELLANT IN THE SAME BUILDING. 3. BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE THAT THE ASSESSEE PURCHASED FLAT NO. 3 ON SECOND FLOOR OF 165, RUBY PARK, KOLKATA-78 DURING FY 2003- 4 RELEVANT TO AY 2004-05 AND APART FROM THIS, ASSESSEE IS HAVING ANOTHER FLAT ON 1 ST FLOOR OF THE SAME SOCIETY. IT IS A FACT THAT THE ASSESSEE DURING PREVIOUS YEAR 2004-05 RELEVANT TO AY 2005-06 , THE YEAR UNDER CONSIDERATION, IS HAVING TWO RESIDENTIAL FLATS. THE AO AFTER GOING THROUGH THE PROVISIONS OF SECTION 23(4)(B) R.W.S. 2 ITA 1904/K/2010 SUBHASH BASU A.Y. 2005-06 SECTION 23(2) OF THE ACT COMPUTED THE ANNUAL VALUE OF ONE FLAT AT RS.60,000/- AS MARKET RENT. AGGRIEVED, ASSESSEE PREFERRED APPEAL BEFORE CIT(A). BEFORE HIM IT WAS CONTENDED THAT THESE TWO UNITS ARE NOT SEPARATE AND IT IS IN THE SAME BU ILDING AND ASSESSEE IS OCCUPYING BOTH THE FLATS. ACCORDING TO ASSESSEE BOTH THE FLATS ARE USED AS A SINGLE UNIT AND IT CANNOT BE TWO UNITS. BUT CIT(A) CONFIRMED THE ACTION OF AO BY GIVING FOLLOWI NG FINDING: 4. I HAVE CONSIDERED THE ABOVE SUBMISSION OF THE A /R. THE A/R HAS ARGUED THAT IN SECTION 23(4), THE TERM HOUSE MEANS A BUILDING ST ANDING ON A PLOT OF LAND WHETHER CONSISTING OF ONE UNIT OR MULTIPLE UNITS. HE HAS CL AIMED SO ON THE GROUND THAT SUCH BUILDING HAS ONE ADDRESS, ELECTRICITY, WATER AND DR AINAGE CONNECTION TO IDENTIFY IT FROM OTHER BUILDING. I DO NOT AGREE WITH THIS INTER PRETATION OF THE LD. A/R. IF THS ARGUMENT IS ACCEPTED THEN A MULTISTORIED BUILDING C ONSTRUCTED ON A PLOT OF LAND HAVING 20 FLATS WLL HAVE TO BE TREATED AS ONE SINGLE HOUS E, WHICH LOOKS EXTREMELY ILLOGICAL AND AWKWARD. WHEN A MULTISTORIED BUILDNG IS CONSTR UCTED ON A PLOT OF LAND AND IT CONSISTS OF NUMBER OF FLATS THEN EACH FLAT IS A RES IDENTIAL UNIT IN ITSELF AND IS A SEPARATE HOUSE. THERE S A SEPARATE ELECTRICITY CONNECTION F OR EACH FLAT, EACH FLAT IS SEPARATELY ASSESSED BY MUNICIPAL AUTHORITIES FOR PROPERTY TAX AND EACH FLAT HAS A SEPARATE FLAT NO. AND ADDRESS, IN VIEW OF THE ABOVE DISCUSSION, I FEEL THAT FOR THE PURPOSES OF SECTION 23(4) THE TWO FLATS OWNED BY THE ASSESSEE ON FIRST & SECOND FLOOR HAVE TO BE TREATED AS SEPARATE HOUSES AND THE ANNUAL LETTING VALUE OF ONE HOUSE HAS TO BE BROUGHT TO TAX. THEREFORE, I CONFIRTN THE ADDTON OF RS.41,256/- M ADE BY THE A.O. 4. I HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. NOW BEFORE US, LD. COUNSEL FOR THE ASSESSEE FAIRLY CONCEDED ALL THESE ISSUES THAT THESE ARE TWO FLATS BEING TWO HOUSES AND SEPARATE ANNUAL VALUE IS TOBE CONSIDERED BUT HE STATED THAT ANNUAL VALUE CONSIDERED BY AO I.E. MARKET RENT IS NOT FAIR RATHER HE SHOULD HAVE CONSIDERED THE ALV IN TERMS OF MUNICIPAL VALUATION. HE IS PRODUCED ONE C ERTIFICATE FROM KOLKATA MUNICIPAL CORPORATION, WHEREIN ALV IS DETERMINED @ RS.7560/-. SINCE THE CERTIFICATE IS PRODUCED BEFORE US FOR THE FIRST TIME LD. COUNSEL AS WELL AS LD. SR . DR FAIRLY CONCEDED THAT THIS CAN BE CONSIDERED BY AO AND FOR THIS, THE ISSUE CAN BE REM ITTED BACK TO THE FILE OF AO. I HAVE GONE THROUGH THE FACTS IN ITS ENTIRETY AND AM OF THE VIE W THAT THE ALV OF THE FLAT SHOULD BE CONSIDERED BUT IN VIEW OF THE VALUATION DONE BY KOLKATA MUNICI PAL CORPORATION WHEREBY A CERTIFICATE DATED 24.06.2005 IS PLACED BEFORE US. THE AO WILL CONSID ER THE SAME AND DECIDE THE ISSUE ACCORDINGLY. APPEAL OF ASSESSEE IS ALLOWED FOR STA TISTICAL PURPOSES. 5. IN THE RESULT, APPEAL OF ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. 6. ORDER PRONOUNCED IN THE OPEN COURT. SD/- , (MAHAVIR SINGH) JUDICIAL M EMBER ( *+ *+ *+ *+) )) ) DATED : 19TH JUNE, 2012 ,- ./ 0 JD.(SR.P.S.) 3 ITA 1904/K/2010 SUBHASH BASU A.Y. 2005-06 () 1 &2 3(2!4- COPY OF THE ORDER FORWARDED TO: 1 . $% / APPELLANT SHRI SUBHASH BASU, 165, RUBY PARK, HAL TU, KOLKATA-700 078 2 &'$% / RESPONDENT ACIT, CIRCLE-19, KOLKATA. 3 . ) ( )/ THE CIT(A), KOLKATA 4. 5. ) / CIT KOLKATA 2:; & / DR, KOLKATA BENCHES, KOLKATA '2 &/ TRUE COPY, ()