SUSHIL VASWANI, Mumbai V. ITO 17(3)(4), Mumbai

ITA 2301/MUM/2019

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 0004 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 8 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-12-2020
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2002-2003
• Appeal Filed On: 12-04-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AJAY PRATAP SINGH
• Section: 143(3); 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH SMC, MUMBAI , ! BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER . 2301 / / 2019 (%. .2002-03 ) ITA NO. 2301/MUM/2019 (A.Y.2002-03) SUSHIL VASWANI, GROUND FLOOR, VASWANI GARDENS, 25 SOBANI ROAD, CUFFE PARADE, MUMBAI 400 005 PAN:AAEPV1830H / VS. : / APPELLANT THE INCOME TAX OFFICER, WARD 17(3)(4), MUMBAI : / RESPONDENT ASSESSEE BY : NONE REVENUE BY : SHRI AJAY PRATAP SINGH / DATE OF HEARING : 12/10/2020 / DATE OF PRONOUNCEMENT : 17/12/2020 / ORDER THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-28, MUMBAI ( I N SHORT THE CIT(A)) DATED 01/02/2019 FOR THE ASSESSMENT YEAR 2002-03.. 2. THE ASSESSEE IN APPEAL HAS RAISED SOLITARY GROUN D AGAINST COMPUTATION OF ANNUAL LETTING VALUE OF THE PROPERTY. THE GROUN D RAISED BY THE ASSESSEE IN APPEAL READS AS UNDER: 2 ITA NO. 2869/MUM/2019 (A.Y.2010-11) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE LAW, THE HONBLE CIT(A) ERRED IN CONFIRMING THE COMPUTATION OF ANNUAL VALUE OF PR OPERTY AT RS.5,68,880/- INSTEAD OF RS.1,68,000/-. THE APPELLANT PRAYS THAT THE SAID A DDITION MAY PLEASE BE HELD AS BAD LAW AND BE DELETED. 3. THIS IS SECOND ROUND OF LITIGATION BY THE ASSE SSEE BEFORE THE TRIBUNAL. THE ASSESSEE IS A CO-OWNER OF PROPERTY LOCATED AT N CPA, NARIMAN POINT, MUMBAI HAVING 20% SHARE. THE PROPERTY WAS LET OUT AND THE ASSESSEE DECLARED ALV OF THE PROPERTY AT RS.1,68,000/- (QUA HIS SHARE OF 20%). IN THE ORIGINAL ASSESSMENT PROCEEDINGS UNDER SECTION 143(3 ) OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT), THE ASSESSING OFFICER D ETERMINED THE ALV OF THE PROPERTY AT RS.6,87,500/-. THE ASSESSEE CARRIED THE ISSUE IN APPEAL BEFORE THE CIT(A). THE CIT(A) DETERMINED THE ALV AT RS.5,68,8 80/-. STILL AGGRIEVED, ASSESSEE FILED APPEAL BEFORE THE TRIBUNAL IN ITA NO .954/MUM/2009. THE CO- ORDINATE BENCH OF THE TRIBUNAL VIDE ORDER DATED 13 /09/2013 RESTORED THE ISSUE BACK TO THE FILE OF ASSESSING OFFICER TO ASCE RTAIN WHETHER THE PROPEPRTY IN QUESTION IS COVERED UNDER RENT CONTROL ACT AND THER EAFTER COMPUTE ALV OF THE PROPERTY IN THE LINE WITH THE DIRECTIONS GIVEN IN I TA NO.3790/MUM/2007 DECIDED ON 09/09/2009 IN THE CASE OF REKHA T. VAS WANI, ANOTHER CO-OWNER OF THE PROPERTY. CONSEQUENT TO REMAND PROCEEDINGS, THE ASSESSING OFFICER PASSED ASSESSMENT ORDER DATED 26/03/2015 UNDER SECT ION 143(3) R.W.S. 254 OF THE ACT DETERMINING ALV OF THE PROPERTY AT RS.5,19, 705/- AND AFTER GIVING BENEFIT OF DEDUCTION UNDER SECTION 24(A) OF THE AC T, THE ASSESSING OFFICER MADE ADDITION OF RS.3,63,793/- IN THE INCOME RETURN ED. AGGRIEVED BY THE AFORESAID ASSESSMENT ORDER, THE ASSESSEE FILED APPE AL BEFORE CIT(A). THE CIT(A) VIDE IMPUGNED ORDER DISMISSED THE APPEAL OF ASSESSEE. HENCE, THE ASSESSEE IS IN PRESENT APPEAL BEFORE THE TRIBUNAL . 3 ITA NO. 2869/MUM/2019 (A.Y.2010-11) 4. SHRI AJAY PRATAP SINGH, REPRESENTING THE DEPARTM ENT VEHEMENTLY DEFENDED THE IMPUGNED ORDER AND PRAYED FOR DISMISS ING THE APPEAL OF ASSESSEE. 5. SUBMISSIONS MADE BY LD.DEPARTMENTAL REPRESENTATI VE HEARD, ORDERS OF AUTHORITIES BELOW EXAMINED. THE SOLITARY ISSUE RA ISED BY THE ASSESSEE IN APPEAL IS QUA COMPUTATION OF ALV OF THE PROPERTY D ETERMINED BY THE REVENUE AT RS.5,68,880/- AS AGAINST RS.1,68,000/- DECLARED BY THE ASSESSEE. A PERUSAL OF THE DOCUMENTS ON RECORD REVEAL THAT THE HOUSE PR OPERTY IN QUESTION IS LOCATED AT NCPA, NARIMAN POINT, MUMBAI. THERE ARE FOUR CO-OWNERS OF THE PROPERTY VIZ: TIKAM VASWANI 30% REKHA VASWANI 30% SUSHIL VASWANI 20%(ASSESSEE ) DEEPAK VASWANI 20% ONE OF THE CO-OWNER REKHA T. VASWANI HAD ALSO DISPU TED THE ALP DETERMINED BY THE ASSESSING OFFICER IN ASSESSMENT YEAR 2002-03 . THE MATTER TRAVELLED TO THE TRIBUNAL IN ITA NO.3790/MUM/2007. THE TRIBUNAL VIDE ORDER DATED 09/09/2009 RESTORED THE ISSUE TO THE ASSESSING OFFI CER FOR PASSING FRESH ORDER AFTER EXAMINING, WHETHER THE PROPERTY WAS COVERED U NDER RENT CONTROL ACT. THE ASSESSING OFFICER IN PROCEEDINGS UNDER SECTION 143(3) R.W.S. 254 OF THE ACT, DETERMINED THE ALV OF THE PROPERTY AFTER MAKING NEC ESSARY ENQUIRES IN LINE WITH THE DIRECTIONS OF THE TRIBUNAL. THE SAID ASSE SSEE THEREAFTER, FILED APPEAL BEFORE CIT(A). AFTER BEING UNSUCCESSFUL BEFORE THE FIRST APPELLATE AUTHORITY, THE ASSESSEE FILED APPEAL BEFORE THE TRIBUNAL IN IT A NO.1861/MUM/2012. THE CO-ORDINATE BENCH DISMISSED HER APPEAR BY OBSERVI NG AS UNDER: 4 ITA NO. 2869/MUM/2019 (A.Y.2010-11) 2.3 WE HAVE HEARD BOTH THE PARTIES AND PERUSED TH E MATERIAL ON RECORD. IT IS PERTINENT TO MENTION THAT IN THE PRESENT CASE, THE ITAT EARLIER HAS DIRECTED THAT IN CASE THE PROPERTY IS NOT COVERED UNDER THE RENT CON TROL ACT, THE ALV HAS TO BE DETERMINED ON THE BASIS OF THE FAIR RENTAL VALUE IN THE MARKET AFTER CONSIDERING ALL RELEVANT FACTS, AND HELD THAT IN SUCH CASES THE STA NDARD RENT OR THE ANNUAL RATABLE VALUE WILL NOT BE THE FAIR RENTAL VALUE OF THE PROP ERTY. THE AO HAS FOLLOWED THE DIRECTIONS OF ITAT, AND AFTER FINDING THAT THE RENT CONTROL ACT IS NOT APPLICABLE, HAS PROCEEDED TO DETERMINE ALV ON THE BASIS OF COMPARAB LE CASE OF A PROPERTY IN THE SAME BUILDING/SOCIETY, GIVING COGENT REASONS FOR AD OPTING THE SAME. THE OBJECTIONS RAISED BY THE ASSESSEE HAVE ALSO BEEN ADDRESSED BY THE AO GIVING REASONS FOR NOT FINDING THEM ACCEPTABLE. IT IS ALSO RELEVANT TO NOT E THAT THE LD.CIT(A), WHILE CONFIRMING THE ACTION OF THE AO HAS CORRECTLY OBSER VED THAT THE ITAT DECISION HAS TAKEN NOTE OF ITAT DECISION IN M/S. BAKER TECHNICAL SERVICES P. LTD. IN ITA NO. 5262- 5264/MUM/2006, ORDER DATED 12.08.2009, IN WHICH IT HAS BEEN HELD THAT IN A PROPERTY NOT SUBJECT TO RENT CONTROL ACT, THE ALV W AS NOT TO BE RESTRICTED TO THE STANDARD RENT AS PER THE RENT CONTROL ACT. THIS POS ITION IS ALSO SUPPORTED BY OTHER DECISIONS. IN DCIT V RITA A PAREKH 2006, 10 SOT 779 , MUMBAI ITAT HAS HELD THAT WHERE IT WAS SHOWN THAT WHERE THE MONTHLY RENT WHIC H COULD BE RECEIVED WAS HIGHER THAN IN CASES WHERE SECURITY DEPOSIT WAS NOT RECEIV ED, THE ASSESSING OFFICER WAS JUSTIFIED IN COMPUTING ALV AT A HIGHER VALUE. IN VI EW OF THAT MATTER, WE DO NOT FIND ANY JUSTIFIABLE REASON TO INTERFERE WITH THE ORDER OF THE LD.CIT(A) CONFIRMING THE ACTION OF THE AO IN COMPUTING THE INCOME FROM HOUSE PROPERTY BY ADOPTING THE ALV ON THE BASIS OF A COMPARABLE CASE IN THE SAME SOCIE TY AND ON THE BASIS OF THE AREA AS PER CERTIFICATE ISSUED BY THE SOCIETY AND THE SAME IS UPHELD. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. 6. THE CASE OF THE PRESENT ASSESSEE BEING CO-OWNER OF THE PROPERTY HAS TRAVELLED THE SAME PATH. IN SECOND ROUND OF ASSES SMENT PROCEEDINGS UNDER SECTION 143(3) R.W.S. 254, OF THE ACT, THE ASSESSIN G OFFICER HAS OBSERVED THAT THE PROPERTY IN QUESTION IS NOT COVERED UNDER THE R ENT CONTROL ACT. THE ASSESSING OFFICER DETERMINED THE ALV OF THE PROPERT Y ON THE BASIS OF COMPARABLE CASE OF THE PROPERTY IN THE SAME BUILDIN G. THE FACT THAT THE PROPERTY IN QUESTION IS NOT COVERED BY THE MAHARAS HTRA RENT CONTROL ACT, 1999 HAS BEEN ADMITTED BY THE ASSESSEE IN SUBMISSIONS M ADE BEFORE THE CIT(A) [RE.PARA11, PAGE 7 OF CIT(A) ORDER] THE FACTS IN T HE CASE OF ASSESSEE ARE PARI- MATERIA TO THE FACTS IN THE CASE OF REKHA T. VASWAN I, CO-OWNER. FOLLOWING THE 5 ITA NO. 2869/MUM/2019 (A.Y.2010-11) DECISION OF CO-ORDINATE BENCH IN THE CASE OF REKHA T. VASWANI,( THE RELEVANT EXTRACT OF THE TRIBUNAL ORDER HAS ALREADY BEEN REPR ODUCED ABOVE) THE APPEAL OF ASSESSEE IS DISMISSED FOR SIMILAR REASONS. 7. IN THE RESULT, IMPUGNED ORDER IS UPHELD AND TH E APPEAL BY ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THURSDAY THE 17 TH DAY OF DECEMBER, 2020. SD/- (VIKAS AWASTHY) / JUDICIAL MEMBER / MUMBAI, (%/ DATED: 17/12/2020 VM , SR. PS(O/S) COPY OF THE ORDER FORWARDED TO : 1. ) / THE APPELLANT , 2. *+ / THE RESPONDENT. 3. ,+ ( )/ THE CIT(A)- 4. ,+ CIT 5. -.*+% , . . . , / DR, ITAT, MUMBAI 6. ./012 / GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI