SHYAM PRABHAKAR REPAL, MUMBAI V. DCIT-23(3), MUMBAI

ITA 5807/MUM/2013

• Counselvise Citation: 580719914 RSA 2013
• Duration Of Justice: 1 year(s) 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2010-2011
• Appeal Filed On: 26-09-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEIL PHILIP
• Assessee Lawyers: C N VAZE

Judgement Text

, , , , , ,, , , IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES E, MUMBAI , , ! BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER, AND SHRI RAJENDRA, ACCOUNTANT MEMBER ITA NO.5807/MUM/2013 ASSESSMENT YEAR:2010-11 SHYAM PRABHAKAR REPAL, 1901-1902, MANISHA GARDEN, NAVGHAR ROAD, MULUND (E), MUMBAI - 400081 ' ' ' ' / VS. DCIT - 23(3) , BANDRA KURLA COMPLEX, BANDRA(E), MUMBAI ( ' %&' /ASSESSEE) ( / REVENUE) P.A. NO.AAHPR1857M ' %&' ( ) ( ) ( ) ( ) / // / ASSESSEE BY): SHRI C.N. VAZE ( ) ( ) ( ) ( ) / REVENUE BY SHRI NEIL PHILIP - DR ' ( '* / / / / DATE OF HEARING : 1 1 /02 /2015 + + + + ( '* /DATE OF ORDER 11 /02/2015 + + + + / / / / O R D E R PER JOGINDER SINGH (JUDICIAL MEMBER) : THE ASSESSEE IS AGGRIEVED BY THE IMPUGNED ORDER DAT ED 08/08/2013 OF THE LD. FIRST APPELLATE AUTHORITY, MU MBAI, ON THE GROUND THAT THE LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE ADDITION OF RS.1, 71,500/- SHYAM PRABHAKAR REPAL 2 AS NOTIONAL RENTAL INCOME UNDER THE HEAD INCOME FR OM HOUSE PROPERTY. 2. DURING HEARING, THE LD. COUNSEL FOR THE ASSESSEE , SHRI C.N.VAZE, CONTENDED THAT THE ISSUE IS COVERED BY THE DECISION OF THE TRIBUNAL DATED 25/05/2012, IN THE C ASE OF SHRI BHAWANJI KUNVERJI HARIA VS DCIT (ITA NO.4032/MUM/2009). THE LD. DR, SHRI NEIL PHILIP, T HOUGH DEFENDED THE CONCLUSION ARRIVED AT IN THE IMPUGNED ORDER BUT COULD NOT CONTROVERT THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE AFORESAID DECISION OF THE TR IBUNAL. 2.1. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE FACT S, IN BRIEF, ARE THAT THE ASSESSEE GOT THE POSSESSION OF THE PREMISES OF SHOPS NO.3 AND 4, RELIABLE BUSINESS CEN TRE, VILLAGE-OSHIWARA, JOGESHWARI (W), MUMBAI, ON 25/01/2010, WHICH WERE SUBSEQUENTLY LEASED OUT. TH E ASSESSEE TOOK THE POSSESSION OF THE PREMISES ON 25/01/2010 BUT THE SHOPS REMAINED VACANT UP TO 31/03/2010 AS THE SAME WERE LET OUT WITH EFFECT FRO M 01/04/2010 AT THE RATE OF RS.1,22,500/- PER MONTH. THE ASSESSING OFFICER ADDED THE NOTIONAL INCOME OF THE PERIOD WHEN THE SHOPS REMAINED VACANT. ON APPEAL, BEFORE THE LD. COMMISSIONER OF INCOME TAX (APPEALS), THE STAND OF THE ASSESSING OFFICER WAS AFFIRMED. THE ASSESSEE IS I N FURTHER APPEAL BEFORE THIS TRIBUNAL. WE NOTE THAT SUB-CLAU SE (B) TO SUB-SECTION (1) TO SECTION 23 SPEAKS ABOUT, WHERE T HE PROPERTY OR ANY PART OF THE PROPERTY IS LET OUT AND THE ACTUAL RENT RECEIVED OR RECEIVABLE IN RESPECT THEREOF IS I N EXCESS OF SHYAM PRABHAKAR REPAL 3 THE SUM REFERRED TO IN CLAUSE (A), THE AMOUNT SO RE CEIVED OR RECEIVABLE SHALL BE THE DEEM SUM FOR WHICH THE PROP ERTY MIGHT REASONABLY BE EXPECTED TO LET FROM YEAR TO YE AR. SECTION-23 OF THE ACT SPEAKS ABOUT AS TO HOW THE AN NUAL VALUE IS TO BE DETERMINED. WE HAVE PERUSED THE AGR EEMENT OF LEAVE & LICENSE BETWEEN THE PARTIED DATED 01/02/ 2010. AS PER AGREEMENT, IT CAME INTO FORCE WITH EFFECT FR OM 01/02/2010, FOR A PERIOD OF 36 MONTHS, I.E. UP TO 31/01/2013 (PAGE-3 OF THE PAPER BOOK). THE PAYMENT SCHEDULE HAS BEEN MENTIONED IN CLAUSE-5 (PAGE-3 OF THE PAPER BOOK) AS PER WHICH THE PAYMENT IS TO BE MADE FROM 1 ST APRIL, 2010 TO 31 ST MARCH 2011 AT THE RATE OF RS.1,17,000/- PER MONTH. THE STAND OF THE ASSESSEE IS THAT FOR INITIAL TWO MONTHS WERE CONSUMED FOR FURNISHING THE SHOPS AND THE RENT OF THESE TWO MONTHS WAS SPREAD O VER TO THE REMAINING PERIOD, THUS, THERE IS NO REASON TO A DD THE NOTIONAL RENTAL INCOME, OTHERWISE, IT WILL MOUNT TO DOUBLE ADDITION. WE FIND MERIT IN THE SUBMISSION OF THE A SSESSEE BECAUSE AS PER AGREEMENT ITSELF, THE MONTHLY RENTAL INCOME FOR THE PERIOD FROM 1 ST APRIL 2010 TO 31 ST MARCH, 2011 IS RS.1,17,000/- AND THE ASSESSING OFFICER HIMSELF TOO K THE RENTAL VALUE AT THE RS.1,71,500/- PER MONTH FOR THE MONTH OF FEBRUARY AND MARCH, 2010. THE RATIO LAID DOWN IN THE AFORESAID ORDER OF THE TRIBUNAL DATED 25/05/2012 FU RTHER SUPPORTS THE CASE OF THE ASSESSEE. WE THEREFORE, F IND NO MERIT IN THE CONCLUSION OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) THAT THE ASSESSEE OUGHT TO HAVE SHOWN THE NOTIONAL RENT FOR THE PERIOD OF TWO MONTHS. THE APP EAL OF THE ASSESSEE IS ALLOWED. SHYAM PRABHAKAR REPAL 4 FINALLY, THE APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES FROM BOTH SIDES, AT THE CONCLUSION OF THE HEARING, ON 11/02/2015 . SD/- (RAJENDRA) SD/- (JOGINDER SINGH) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; ,' DATED : 11/02/201 5 F{X~{T? P.S/. '.. + ( .'/ 0/1' + ( .'/ 0/1' + ( .'/ 0/1' + ( .'/ 0/1'/ COPY OF THE ORDER FORWARDED TO : 1. 23 / THE APPELLANT 2. .423 / THE RESPONDENT. 3. 5 ( ) / THE CIT, MUMBAI. 4. 5 / CIT(A)- , MUMBAI 5. /78 .'' , , / DR, ITAT, MUMBAI 6. 89% : / GUARD FILE. +' +' +' +' / BY ORDER, 4/' .' //TRUE COPY// ; ;; ;/ // /< < < < (DY./ASSTT. REGISTRAR) , , , , / ITAT, MUMBAI