Uphar Automobiles Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 338/DEL/2012

• Counselvise Citation: 33820114 RSA 2012
• Duration Of Justice: 8 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-10-2012
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Next Hearing Date: 03-10-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 23-01-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y S KAKKAR DR HEARING ON
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC NEW DELHI BEFORE SHRI I. C. SUDHIR, JUDICIAL MEMBER AND SHRI A. N. PHUJA, ACCOUNTANT MEMBER I.T.A. NO. 338/DEL/2012 ASSESSMENT YEAR: 2008-09 UPHAR AUTOMOBILES (P) LTD. ITO, C-33, PANCHSHEEL GARDEN, WARD 18 (1), SUBHASH PARK, NAVEEN SHAHDARA VS. NEW DELHI NEW DELHI. PAN:-AAACU5257E (ASSESSEE) (REVENUE) ASSESSEE BY: SH. PRATAP GUPTA, CA REVENUE BY: SH. Y.S. KAKKAR, DR. HEARING ON : 10/10/2012 ORDER PRONOUNCED ON THE DATE: .. ORDER PER I.C.SUDHIR, JM: THE ASSESSEE HAS QUESTIONED FIRST APPELLATE ORDER O N THE GROUNDS THAT THE LD. CIT (A) IS NOT JUSTIFIED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN DISALLOWING THE CLAIM OF DEDUCTION OF LE ASE RENT OF RS.1,40,161/- MADE BY THE APPELLANT COMPANY U/S 23 OF THE IT ACT FROM INCOME FROM THE HOUSE PROPERTY. ITA NO.338/DEL/2012 2 2. THE FACTS IN BRIEF ARE THAT THE ASSESSEE HAD DEBITE D AN AMOUNT OF RS.1,40,161/- FROM THE INCOME BOOKED UNDER THE HEAD HOUSE PROPERTY. THE AO DENIED THE CLAIMED DEDUCTION ON THE BASIS TH AT IT IS NOT ALLOWABLE UNDER THE PROVISIONS OF SECTION 24 OF THE ACT. HE H ELD THAT THE ASSESSEE IS ENTITLED FOR DEDUCTION FOR REPAIRS @ 30% FROM THE A NNUAL VALUE. HE ACCORDINGLY ADDED THE AMOUNT OF RS.1,40,161/- TO TH E DECLARED INCOME OF THE ASSESSEE. THE LD. CIT (A) HAS ALSO UPHELD THE SAME. 3. THE LD. AR SUBMITTED THAT THE ASSESSEE HAD NOT CLAI MED ANY DEDUCTION U/S 24 OF THE ACT BUT DEDUCTION CLAIMED UNDER SECTI ON 23 WAS OF LEASE RENT WHICH WAS LEVIED AS LOCAL TAXES BY NOIDA WHICH IS T HE LOCAL AUTHORITY. HE SUBMITTED THAT NOIDA HAS BEEN DEVELOPED BY NEW OKHL A INDUSTRIAL DEVELOPMENT AUTHORITY AS SATELLITE TOWN IN NCR. IT WORKS AS LOCAL AUTHORITY OF THE AREA. THERE IS NO MUNICIPALITY WORKING THERE . LEASE RENT IS BEING CHARGED BY NOIDA AS PROPERTY TAX. HE SUBMITTED THAT BEFORE THE AUTHORITIES BELOW, ASSESSEE HAD FURNISHED A COPY OF ALLOTMENT L ETTER OF THE SAID PROPERTY TO SUPPORT HIS CONTENTION THAT PAYMENT OF LEASE REN T IS A MANDATORY PAYMENT, THEREFORE, ASSESSEE IS ENTITLED FOR THE DEDUCTION O F THE PAID LEASE RENT U/S 23 OF THE ACT. THE LD. AR ALSO PLACED RELIANCE ON THE FOLLOWING DECISIONS: - CIT VS. VENUGOPALA REDDIAR. (1965) 58 ITR 439 (MAD.) ITA NO.338/DEL/2012 3 - B. R. HERMAN & MOHATTA (INDIA) (P) LTD V. ASSISTANT COMMISSIONER OF INCOME TAX (2005) 143 TAXMAN 21 (MUM) (MAG.) - NEMINATH INDUSTRIES PVT LTD VS. ITO WARD 13(2) (ORDER DATED 4 TH SEPTEMBER, 2009 IN CASE OF ITA NO. 2795/DEL/2009) - COMMISSIONER OF INCOME TAX, RANCHI VS. TATA ROBINS FRASER LTD (2012) 26 TAXMANN.COM 15 (JHARKHAND) - NEW PIECE GOODS BAZAR CO. LTD. VS. COMMISSIONER OF INCOME TAX (1950) 18 ITR 516 (SC) 4. THE LD. DR ON THE OTHER HAND OBJECTED THE APPEAL WI TH THIS SUBMISSION THAT THE LEASE RENT PAID BY THE ASSESSEE CAN NOT BE EQUATED WITH THE TAXES LEVIED BY THE LOCAL AUTHORITY ON HOUSE PROPERTY TO MAKE THE ASSESSEE ELIGIBLE FOR CLAIMING DEDUCTION U/S 23 OF THE ACT. 5. HAVING GONE THROUGH THE ORDERS OF THE AUTHORITIES B ELOW AND THE DECISIONS RELIED UPON IN VIEW OF THE ARGUMENTS ADVA NCED BY THE PARTIES, WE FIND THAT THE ASSESSEE HAS BEEN TRYING TO EXPLAIN T HAT THE LEASE RENT AMOUNTING TO RS.1,40,161/- PAID BY IT TO THE NOIDA IS ACTUALL Y TAX LEVIED TO A LOCAL AUTHORITY IN RESPECT OF THE PROPERTY IN QUESTION, W ITHIN THE MEANING OF THE PROVISIONS LAID DOWN U/S 23 OF THE ACT, HENCE THE A SSESSEE IS ELIGIBLE FOR CLAIMING DEDUCTION OF THE AMOUNT UNDER THE SAID PRO VISIONS. THE CONTENTION OF THE ASSESSEE REMAINED THAT FOR THE PROPERTY OF T HE ASSESSEE THE LOCAL AUTHORITY IS NOIDA. WE ARE OF THE VIEW THAT IN ABSE NCE OF EVIDENCE IN SUPPORT IT IS VERY DIFFICULT TO ACCEPT ABOVE CONTEN TION OF THE ASSESSEE. THE CONTENTION OF THE LD. AR ALSO REMAINED THAT HE HAD PRODUCED A COPY OF THE ITA NO.338/DEL/2012 4 ALLOTMENT LETTER OF THE SAID PROPERTY IN SUPPORT BE FORE THE LD. CIT (A) BUT THE SAME HAS NOT BEEN CONSIDERED. WE THUS IN THE INTERE ST OF JUSTICE REMAND THE MATTER TO THE FILE OF THE AO TO DECIDE THE ISSUE AF RESH AFTER AFFORDING OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND AFTE R CONSIDERING THE CONTENTS OF LEASE DEED AND ANY OTHER DOCUMENTS WHICH THE ASS ESSEE WANTS TO FILE TO ESTABLISH HIS CONTENTION THAT THE LEASE RENT IS BEI NG CHARGED BY THE NOIDA ON THE PROPERTY AS PROPERTY TAX. THE GROUND IS THUS ALLOWED FOR STATISTICAL PURPOSES. 6. IN RESULT APPEAL IS ALLOWED FOR STATISTICAL PURPOSE S. 7. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON THE DAY 10/10/2012. SD/- SD/- ( A. N. PAHUJA ) (I.C.S UDHIR) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 10/10/2012 *AK VERMA* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR