Asha Burman, New Delhi V. ACIT Circle- 46(1), New Delhi

ITA 3414/DEL/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 4918 (ITAT-DELHI)
• Duration Of Justice: 3 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2015-2016
• Appeal Filed On: 18-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MITHUN SETHY
• Keywords: Opportunity of being heard; Set aside
• Section: 13; 23(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI A BEN CH, NEW DELHI BEFORE SHRI T.S. KAPOOR, ACCOUNTANT MEMBER, AND SHRI AMIT SHUKLA, JUDICIAL MEMBER, ITA NO.3414/DEL/2019 [ASSESSMENT YEAR: 2015-16] SMT. ASHA BURMAN, 4 TH FLOOR, PUNJABI BHAWAN, 10, ROUSE AVENUE, NEW DELHI ACIT, CIRCLE-46(1), NEW DELHI PAN - AAEPB0966C APPELLANT RESPONDENT APPELLANT BY SHRI M.P. RASTOGI RESPONDENT BY SHRI MITHUN SETHY DATE OF HEARING 14 /08 /2019 DATE OF PRONOUNCEMENT 14 /08 /2019 ORDER PER T.S. KAPOOR, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A)-16, NEW DELHI, DATED 19/03/2019. 2. THE LD AR, AT THE OUTSET SUBMITTED THAT THE ASSE SSEE HAD LET OUT ONLY 03RD FLOOR OF THE BUILDING, SITUATED AT KAUTIL YA MARG, HOWEVER, THE ASSESSING OFFICER TOOK THE ANNUAL RENTAL VALUE OF W HOLE OF THE BUILDING AND ASSESSED THE INCOME FROM HOUSE PROPERTY ON THE BASIS OF ARV OF WHOLE OF THE BUILDING. IT WAS SUBMITTED THAT THE AS SESSEE IN THE LEASE DEED, DUE TO IN ADVERTENT MISTAKE, HAD NOT MENTIONE D THAT SHE HAD LET OUT ONLY THIRD FLOOR OF THE BUILDING AND THEREFORE DETAILED SUBMISSIONS 2 WERE MADE BEFORE THE LD. CIT(A) REGARDING THIS FACT BUT THE LD.CIT(A) DISMISSED THE APPEAL OF THE ASSESSEE RELYING ON THE LEASE DEED AND DID NOT VERIFY THE ARGUMENTS OF ASSESSEE ON THE BASIS O F PHYSICAL VERIFICATION. THEREFORE, IT WAS PRAYED THE MATTER MAY BE SET ASIDE TO THE ASSESSING OFFICER, WHO SHOULD BE DIRECTED TO VERIFY THIS FACT. 3. THE LD DR, ON THE OTHER HAND, SUBMITTED THAT THE LD CIT(A) HAS CONSIDERED THE ARGUMENTS OF THE ASSESSEE AND HAS RE PRODUCED LEASE DEED IN HIS APPELLATE ORDER. THERE IS NO MENTION OF LEASING OUT OF 3 RD FLOOR, THEREFORE, THE APPEAL OF THE ASSESSEE SHOULD BE DISMISSED. 4. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT DURING T HE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER OBSER VED THAT THE ASSESSEE HAD LEASED OUT HER PROPERTY FOR A MEAGRE A MOUNT OF RS.30,000/- PER MONTH AND AT THE SAME TIME SHE HAD RECEIVED DEPOSIT OF RS.10 CRORES FROM THE TENANT. THE ASSESSING OFFICER ESTIMATED THE RENT AS PER THE PROVISIONS OF SECTION 23(1) OF THE ACT A ND MADE ADDITIONS OF RS.1,78,76,700/-. 5. THE ASSESSEE TOOK THE MATTER BEFORE LD CIT(A) AN D BESIDES OTHER ARGUMENTS ALSO TOOK THE ARGUMENT THAT ONLY A PART O F BUILDING WAS LET OUT AND THE REMAINING PART WAS RETAINED BY THE ASSESSEE FOR HERSELF. SUCH SUBMISSIONS OF THE ASSESSEE ARE REPRODUCED BY THE L D CIT(A) AT PAGE 3 13 OF HIS ORDER. HOWEVER, HE DISMISSED THE APPEAL O F THE ASSESSEE BY HOLDING THAT IN THE RENT DEED, THERE IS NO MENTION OF LEASING OUT OF PART OF THE PROPERTY AND HELD THAT ENTIRE BUILDING HAS BEEN LET OUT AND THEREFORE HE DISMISSED THE APPEAL OF THE ASSESSEE. THE RELEVA NT PORTION OF THE ORDER OF THE LD. CIT(A) IS REPRODUCED HEREUNDER:- A PERUSAL OF THE REJOINDER OF THE APPELLANT WAS MAD E. THE APPELLANT HAS CLAIMED CHAT THE ENTIRE PROPERTY WAS NOT LET OUT BY THE APPELLAN T AND HENCE THE RENTAL VALUE OF BUNGALOW 19 RENTED OUT BY MRS GUJRAL CANNOT BE THE CORRECT YARDSTICK OF ESTIMATION OF THE RENTAL PROPERTY OF THE APPELLANT. THE APPELLANT HAS CLAIMED THAT THE PROPERTY CONSTITUTES GROUND + 3 FLOORS, OUT OF WHICH GROUND + 2 FLOORS ARE RETAINED BY THE APPELLANT AND ONLY THE 3 RD FLOOR HAS BEEN RENTED OUT TO GYAN ENTERPRISES. TO EXAMINE THE VERACITY OF THE CLAIM OF THE APPELLANT, THE LEASE DEED WAS EXAMINED . IT IS NOTED THAT THE LEASE DEED PERTAINS TO THE ENTIRE PROPERTY SITU ATED AT 23, KAUTILYA MARG, NEW DELHI. THERE IS NO CLAUSE IN THE RENT DEED STATING THAT ONLY A PART OF THE PREMISES HAVE BEEN LEASED OUT TO GYAN ENTERPRISES A S CLAIMED BY THE APPELLANT DURING APPELLANT PROCEEDINGS. A SCANNED COPY OF THE LEASE D EED I S REPRODUCED AS UNDER TO SUBSTANTIATE MY AFOREMENTIONED OBSERVATION: 4 IN THE LIGHT OF THE DETAILED DISCUSSION ABOVE, THE CLEAR-CUT FINDING OF THE AO REGARDING AN EXISTING COMPARABLE PROPERTY IN THE IMMEDIATE VICINITY, I HAVE NO HESITATION IN HOLDING THAT THE AO HAD RIGHTLY ESTIMATED THE ANNUAL RENTAL VALUE OF THE PR OPERTY AT RS.1,79,00,000/-. I UPHOLD THE ADDITION OF RS.1,78, 76,700/- MADE BY THE AO ON THIS ACCOUNT. 6. THE LD AR BEFORE US, HAD STATED THAT THE ASSESSE E INADVERTENTLY COULD NOT MAKE A MENTION OF THE FACT OF HAVING LET OUT ONLY A PART OF BUILDING, WHEREAS THE FACT REMAINS THAT ONLY 3RD FL OOR WAS LET OUT. HE HAS ALSO MENTIONED THAT THIS FACT CAN BE VERIFIED BY DE PUTING OFFICER OF THE DEPARTMENT. THE LD CIT(A) HAS NOT CONSIDERED THIS A SPECT AND HAS DISMISSED THE APPEAL RELYING ON THE LEASE DEED. THE REFORE, WE REMIT THE 5 ISSUE BACK TO THE ASSESSING OFFICER WHO SHOULD READ JUDICATE THE ISSUE AFTER PHYSICALLY VERIFYING THE CONTENTION OF THE AS SESSEE REGARDING HAVING LET OUT ONLY A PART OF BUILDING. THE ASSESSING OFFI CER IS FURTHER DIRECTED TO EXAMINE OTHER CIRCUMSTANTIAL EVIDENCES WHICH THE AS SESSEE MAY FILE IN SUPPORT OF HER CONTENTIONS AND ONLY THEN HE SHOULD DECIDE AS PER LAW. NEEDLESS TO SAY THAT THE ASSESSEE WILL BE PROVIDED SUFFICIENT OPPORTUNITY OF BEING HEARD. 7. IN THE RESULT APPEAL OF THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 14/08/2019. SD/- SD /- [AMIT SHUKLA] [T.S. KAPOOR] JUDICIAL MEMBER ACCOUNTANT MEMBER DELHI; DATED: 14/08/2019. F{X~{T? F{X~{T? F{X~{T? F{X~{T? FA FA FA FA P.S P.SP.S P.S COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI