ITO 9(3)(2), MUMBAI V. SPEARTHEAD PROPERTIES P. LTD, MUMBAI

ITA 782/MUM/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 48997 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 3 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2011
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: E
• Next Hearing Date: 03-05-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 05-02-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: D K SHIVRAMRAHUL K HAKANI
• Keywords: Notional interest

Judgement Text

1 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI MUMBAI MUMBAI MUMBAI E E E E BENCH BENCH BENCH BENCH MUMBAI BENCHES, MUMBAI MUMBAI BENCHES, MUMBAI MUMBAI BENCHES, MUMBAI MUMBAI BENCHES, MUMBAI BEFORE SHRI BEFORE SHRI BEFORE SHRI BEFORE SHRI P M JAGTAP, AM & P M JAGTAP, AM & P M JAGTAP, AM & P M JAGTAP, AM & SHRI SHRI SHRI SHRI VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM ITA NO ITA NO ITA NO ITA NOS SS S. . . . 780 TO 78 780 TO 78 780 TO 78 780 TO 782 22 2/MUM/2009 /MUM/2009 /MUM/2009 /MUM/2009 (ASST YEAR (ASST YEAR (ASST YEAR (ASST YEARS 2003 S 2003 S 2003 S 2003- -- -04 TO 20 04 TO 20 04 TO 20 04 TO 200 00 05 55 5- -- -06 0606 06 ) )) ) THE INCOME TAX OFFICER WARD 9(3)(2), MUMBAI VS M/S SPEARTHEAD PROPERTIES P LTD 501 KRYSTAL BLDG 206 N S PATKAR MARG BANDRA (W), MUMBAI 50 ( (( (APPELLANT APPELLANT APPELLANT APPELLANT) )) ) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) PAN NO. PAN NO. PAN NO. PAN NO.AABCS8585Q AABCS8585Q AABCS8585Q AABCS8585Q A SSESSEE BY SHRI D K SHIVRAM/RAHUL K HAKANI REVENUE BY SHRI S K SINGH PER PER PER PER VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM VIJAY PAL RAO, JM THESE THREE APPEAL FILED BY THE REVENUE ARE DIREC TED AGAINST THE SEPARATE ORDERS OF THE CIT(A) ONE DATED 10.12.2008 AND THE OTHER TWO DATED 19.11.2008 FOR THE ASSESSMENT YEARS 2003-04 TO 2005-06 RESPECT IVELY. 2 THE REVENUE HAS RAISED VARIOUS COMMON GROUNDS IN THESE APPEALS; HOWEVER, THE ONLY ISSUE ARISES FOR OUR CONSIDERATIO N AND ADJUDICATION IS WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE THE CIT( A) IS JUSTIFIED IN DELETING THE ADDITION MADE BY THE ASSESSING OFFICER BY DETERMINI NG THE ALV U/S 23(1)(A) ON ACCOUNT F NOTIONAL INTEREST ON INTEREST FREE DEPOS ITS OF RS. 5,25,00,000/-. 2.1 THE BRIEF FACTS OF THE CASE ARE THAT THE ASSES SEE COMPANY ENTERED INTO A LEAVE & LICENSE AGREEMENT WITH M/S LUCENT TECHNOLO GIES HINDUSTAN P LTD ON 9.10.2002 FOR A PERIOD OF 33 MONTHS W.E.F 1.11.2002 ON A MONTHLY RENT OF RS. 1 LAKH. THE ASSESSEE COMPANY ALSO RECEIVED INTEREST FREE DEPOSIT OF RS. 5,25,00,000/- FROM THE LICENSEE OF M/S LUCENT TECHNOLOGIES P LTD. THE 2 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) ASSESSEE COMPANY DECLARED THE RENTAL INCOME @ RS. 1 LAKH PER MONTH FOR THE RESPECTIVE PERIOD FOR ALL THE THREE ASSESSMENT YEAR S. THE ASSESSING OFFICER WAS OF THE VIEW THAT THE INTEREST FREE SECURITY DEPOSIT RECEIVED OF RS. 5,25,00,000/- UTILISED FOR GIVING INTEREST FREE LOAN AND ADVANCES TO THE SISTER CONCERNS HAS BEEN RECEIVED BY THE ASSESSEE TO LOWER DOWN THE INCOME F ROM HOUSE PROPERTY AND ENJOY INDIRECTLY THE BENEFIT OF HUGE SECURITY DEPO SIT. THE ASSESSING OFFICER DETERMINED THE ALV U/S 23(1)(A) BY TAKING INTO ACC OUNT 10% OF THE INTEREST FREE DEPOSIT OF RS. 5.25 CRORES AND @ 10% HAS BEEN APPLIED AS BASIS OF RATE BEING THE INTEREST FOR LONG TIME FIXED DEPOSITS. THOUGH THE ASSESSING OFFICER MADE SOME ENQUIRIES ABOUT THE MARKET RENT IN THE LOCALIT Y AND AS PER THE ASSESSING OFFICER, THE SAME IS MORE THAN WHAT THE ASSESSEE HA S SHOWN. HOWEVER, THE ASSESSING OFFICER WHILE COMPUTING THE ALV U/S 23(1) (A) TAKEN INTO CONSIDERATION ONLY 10% OF THE INTEREST FREE DEPOSIT OF RS. 5.25 C RORES. 2.2 ON APPEAL, THE CIT(A) DELETED THE SAID ADDITIO N BY FOLLOWING THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF CI T VS J K INVESTORS (BOMBAY) LTD REPORTED IN 248 ITR 723. 3 BEFORE US THE LD DR SUBMITTED THAT THE JURISDICTI ONAL HIGH COURT IN THE CASE OF J K INVESTORS HAS KEPT OPEN THE ISSUE OF NOTIONA L BENEFIT WHEREAS THE ISSUE IS NOW SETTLED BY THE FULL BENCH OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS MONI KUMAR SUBBA & OTHER REPORTED IN 333 ITR 38 (DELHI) (FB) 3.1 ON THE OTHER HAND, THE LD AR OF THE ASSESSEE HA S RELIED ON THE ORDER OF THE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF DC IT VS RECLAMATION REALITY INDIA P LTD IN ITA NO.1411/MUM/07 DATED 26.11.2010 AND SUBMITTED 3 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) THAT THE LD CIT(A) IS RIGHT IN HOLDING THAT NO NOTI ONAL BENEFIT ON ACCOUNT OF INTEREST FREE DEPOSIT FOR THE PURPOSE OF DETERMININ G THE ALV CAN BE ADDED. 4 WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PERUS ED THE RELEVANT MATERIAL ON RECORD. FOR THE PURPOSE OF T AXATION OF INCOME FROM HOUSE PROPERTY, SECTION 22 PRESCRIBES THE ANNU AL VALUE OF THE PROPERTY CONSISTING OF BUILDING OR LAND APPURTENANT THERETO OF WHICH THE ASSESSEE IS OWNER. THUS, INCOME FROM HOUSE PROP ERTY IS MEASURED AS ANNUAL VALUE OF THE PROPERTY. SECTION 23 CONTEMPLATES THE MANNER IN WHICH THE ANNUAL VALUE OF THE PROPERT Y HAS TO BE DETERMINED. AS PER SUBSECTION (1) OF SECTION 23 TH E AO HAS TO FIRST DETERMINE THE SUM FOR WHICH THE PROPERTY MIGHT REAS ONABLY BE EXPECTED TO FETCH THE RENT FROM YEAR TO YEAR AND TH EN IF THE PROPERTY IS LET OUT COMPARE THE SAME WITH THE ANNUAL/ACTUAL RENT RECEIVED OR RECEIVABLE. THUS, AS PER CLAUSE (A) OF SUB-SECTIO N (1) OF SECTION 23 THE REASONABLE RENT EXPECTED TO BE FETCHED BY HE P ROPERTY BY LETTING OUT FROM YEAR TO YEAR HAS TO BE DETERMINED. CLAUSE (B) OF SUBSECTION (1) OF SECTION 23 DEALS WITH THE CASES WHERE THE PROPERTY IS LET OUT. IT IS PERTINENT TO NOTE THAT PRIOR TO A MENDMENT WITH EFFECT FROM 1.4.1996 THERE WAS NO SUCH CLAUSE (B) IN SUB-S ECTION(1) OF SECTION 23. THE PROVISIONS WAS FURTHER AMENDED BY THE FINANCE ACT 2001 W.E.F 1.4.2002 WHEREBY THE WORD ANNUAL RENT RECEIVED OR RECEIVABLE HAS BEEN SUBSTITUTED BY THE WORD ACT UAL RENT RECEIVED OR RECEIVABLE. THOUGH THIS CHANGE OF THE TERM FRO M ANNUAL RENT TO ACTUAL RENT HAS NOT ALTERED ANY MATERIAL MEANING O F THE PROVISION EXCEPT FOR THE FIRST YEAR OF LETTING OUT OR THE PRO PERTY IS NOT LET OUT 4 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) FOR FULL YEAR. THUS, FOR DETERMINATION OF THE ALV UNDER SECTION 23(1), THE AO HAS FIRST TO FIND OUT THE REASONABLY EXPECTED RENT WHICH THE PROPERTY MIGHT FETCH BY LETTING OUT FROM YEAR TO YEAR AND THEN THIS REASONABLY EXPECTED RENT HAS TO BE COMPAR ED WITH THE ANNUAL RENT RECEIVED OR RECEIVABLE BY THE OWNER AND IF ANNUAL RENT RECEIVED OR RECEIVABLE AS CONTEMPLATED UNDER SECTIO N 23(1)(B) IS IN EXCESS OF THE REASONABLE RENT EXPECTED FROM LETTING OUT THE PROPERTY FROM YEAR TO YEAR AS DETERMINED U/S 23(1)(A) THE AM OUNT SO RECEIVED OR RECEIVABLE WOULD THE ANNUAL VALUE FOR THE PURPO SE OF SECTION 22 OF THE ACT. THE INCOME TAX ACT DOES NOT DEFINE TH E TERM REASONABLE EXPECTED RENT TO BE FETCHED BY THE PROPERTY FROM LETTING OUT FROM YEAR TO YEAR. NO METHOD FOR DETERMINATION OF SUCH REASONABLE RENT U/S 23(1)(A) HAS BEEN PROVIDED EITHER IN THE ACT OR IN THE RULES FRAMED THERE UNDER. ONLY THE JUDICIAL PRONOUNCEMEN TS ON THE ISSUE HAVE THROWN SOME LIGHT AS HOW TO DETERMINE THE S UM FOR WHICH THE PROPERTY MAY REASONABLY BE EXPECTED TO LET OUT FR OM YEAR TO YEAR U/S 23(1)(A). 4.1 WE FURTHER FIND THAT THE COORDINATE BENCH OF TH E TRIBUNAL IN THE CASE OF TIVOLI INVESTMENT AND TRADING CO., VS ACIT IN ITA NOS. 2808 AND 2809/MUM/1996 AFTER FOLLOWING THE DECISION OF T HE FULL BENCH OF THE HONBLE DELHI HIGH COURT IN THE CASE OF MONI KUMAR SUBBA & OTHER (SUPRA) HAS DECIDED THIS ISSUE VIDE ORDER DATED 30 TH APRIL 2011. THE RELEVANT PORTION OF THE ORDER OF THE TRIBUNAL READ AS UNDER: 28. FROM THE ORDER OF THE AO IS CLEAR THAT THE AO HAS NOT EVEN MADE AN ATTEMPT TO DETERMINE THE FAIR RENT U/S 23(1)(A). 5 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) IT IS ALSO NOT CLEAR AS UNDER WHAT PROVISION, THE A DDITIONS ON ACCOUNT OF INTEREST ON INTEREST FREE DEPOSITS IS M ADE. IT IS PERTINENT TO NOTE THAT THE ALLEGED CERTIFICATE GIVE N BY THE SOCIETY FOR RETABLE VALUE WAS NOT AVAILABLE BEFORE THE AUTHORITIES BELOW AS IT WAS GIVEN MUCH LATER ON 20. 102003. THUS, IN OUR VIEW, THE AO HAS NOT FOLLOWED THE PR OPER PROCEDURE AS PROVIDED UNDER THE PROVISIONS OF SECTI ON 23(1). AS WE HAVE DISCUSSED IN THE FORGOING PARAGRAPHS T HAT THE DECISION OF THE HON. SUPREME COURT IN THE CASE OF M RS. SHIELA KAUSHISH (SUPRA), THE ISSUE WAS WHETHER THE ACTUAL RENT RECEIVED BY THE LAND LORD IS RELEVANT FOR DETERMIN ATION OF THE ANNUAL VALUE AS PER SECTION 23(1). THE HON. SUPRE ME COURT HELD THAT THE STANDARD RENT OF DIFFERENT PORTIONS O F THE WARE HOUSE DETERMINABLE UNDER THE PROVISIONS OF RENT C ONTROL ACT SHOULD BE TAKEN THE ANNUAL VALUE OF THE WARE HOUSE WITHIN THE MEANING OF SUB-SECTION (1) OF SECTION 23 OF THE AC T AN NOT THE ACTUAL RENT. THUS, THE HON. SUPREME COURT HELD THA T THE ACTUAL RENT RECEIVED BY THE ASSESSEE FROM THE TENANT SHO ULD NOT BE TAKEN TO BE THE ANNUAL VALUE WITHIN THE MEANING OF SUB- SECTION (1) OF SECTION 23. IN THE CASE OF J K INV ESTORS (SUPRA), THE HON.HIGH COURT HAS OBSERVED THAT WHILE DECIDING THE FAIR RENT VARIOUS FACTORS SHOULD BE TAKEN INTO ACCOUNT . IN SUCH CASE VARIOUS METHOD LIKE CONTRACTOR METHOD COULD BE TAKEN INTO ACCOUNT. AS HELD BY THE THIRD MEMBER DECISION OF THIS TRIBUNAL IN THE CASE OF ITO V/S BAKER TECHNICAL SER VICES PVT. LTD (SUPRA) THAT THE ANNUAL LETTING VALUE CANNOT BE LIMITED TO STANDARD RENT BUT THE STANDARD RENT IS ONE OF THE V ARIOUS FACTORS TO BE TAKEN INTO ACCOUNT FOR DETERMINATION OF THE FAIR RENT. IN THE RECENT DECISION DATED 30.3.2011, FULL BENCH OF THE HONBLE DELHI HIGH COURT, IN THE CASE OF CIT V/S M ONI KUMAR SUBBA AND ORS IN ITA NO.499 OF 2010, ITA NO.803 O F 2007, ITA NO.1113 OF 2008, ITA NO.388 OF 2010, ITA NO.516 OF 2010, ITA NO.1034 OF 2010 AND ITA NO.1240 OF 2010, AFTER CON SIDERING THE DECISION OF THE DIVISION BENCH OF THE HON.HIGH COURT IN THE CASE OF CIT V/S ASIAN HOTELS LTD OBSERVED AND HEL D IN PARAGRAPH 13 TO 22 AS UNDER : 13. WE APPROVE THE AFORESAID VIEW OF THE DIVISION BENCH OF THIS COURT AND OPERATIVE WORDS IN SECTION 23 (1)(A) OF THE ACT ARE THE SUM FOR WHICH THE PROPER TY MIGHT REASONABLY BE EXPECTED TO LET FROM YEAR TO YE AR. THESE WORDS PROVIDE A SPECIFIC DIRECTION TO THE REV ENUE FOR DETERMINING THE FAIR RENT . THE AO, HAVING REGARD TO THE AFORESAID PROVISION IS EXPECTED TO MAKE AN INQU IRY AS TO WHAT WOULD BE THE POSSIBLE RENT THAT THE PROP ERTY MIGHT FETCH. THUS, IF HE FINDS THAT THE ACTUAL RENT RECEIVED IS LESS THAN THE FAIR/MARKET RENT BECAUSE OF THE REASON THAT THE ASSESSEE HAS RECEIVED ABNORMALL Y HIGH INTEREST FREE SECURITY DEPOSIT AND BECAUSE OF THAT REASON, THE ACTUAL RENT RECEIVED IS LESS THAN THE R ENT 6 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) WHICH THE PROPERTY MIGHT FETCH, HE CAN UNDERTAKE NECESSARY EXERCISE IN THAT BEHALF. HOWEVER, BY NO STRETCH OF IMAGINATION, THE NOTIONAL INTEREST ON TH E INTEREST FREE SECURITY CAN BE TAKEN AS DETERMINATIV E FACTOR TO ARRIVE AT A FAIR RENT . PROVISIONS OF SECTION 23(1)(A) DO NOT MANDATE THIS. THE DIVISION BENCH IN ASIAN HOTELS LIMITED (SUPRA) ASIAN HOTELS LIMITED (SUPRA) ASIAN HOTELS LIMITED (SUPRA) ASIAN HOTELS LIMITED (SUPRA), THUS, RIGHTLY OBSERVE D THAT IN A TAXING STATUTE IT WOULD BE UNSAFE FOR THE COUR T TO GO BEYOND THE LETTER OF THE LAW AND TRY TO READ INTO T HE PROVISION MORE THAN WHAT IS ALREADY PROVIDED FOR. W E MAY ALSO RECORD THAT EVEN THE BOMBAY HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX COMMISSIONER OF INCOME TAX COMMISSIONER OF INCOME TAX COMMISSIONER OF INCOME TAX VS. J. K. INVESTORS J. K. INVESTORS J. K. INVESTORS J. K. INVESTORS (BOMBAY) LTD. (BOMBAY) LTD. (BOMBAY) LTD. (BOMBAY) LTD., [(2001) 248 ITR 723 (BOM.)] CATEGORI CALLY REJECTED THE FORMULA OF ADDITION OF NOTIONAL INTERE ST WHILE DETERMINING THE FAIR RENT IN THE FOLLOWING MANNER: .BEFORE CONCLUDING WE MAY POINT OUT THAT UNDER SECTION (23)(1)(B), THE WORD 'RECEIVABLE' DENOTES PAYMENT OF ACTUAL ANNUAL RENT TO THE ASSESSEE. HOWEVER, IF IN A GIVEN YEAR A PORTION OF THE ACTUAL ANNUAL RENT IS IN ARREARS, IT WOULD STIL L COME WITHIN SECTION (23)(1)(B) AND IT IS FOR THIS REASON THAT THE WORD 'RECEIVABLE' MUST BE READ IN THE CONTEXT OF THE WORD 'RECEIVED' IN SECTION(23)(1)(B). IN THE LIGHT OF THE ABOVE INTERPRETATION, NOTIONAL INTEREST CANNOT FORM PART OF NOTIONAL INTEREST CANNOT FORM PART OF NOTIONAL INTEREST CANNOT FORM PART OF NOTIONAL INTEREST CANNOT FORM PART OF THE A THE A THE A THE ACTUAL RENT AS CONTEMPLATED BY SECTION CTUAL RENT AS CONTEMPLATED BY SECTION CTUAL RENT AS CONTEMPLATED BY SECTION CTUAL RENT AS CONTEMPLATED BY SECTION (23)(1)(B) OF THE ACT (23)(1)(B) OF THE ACT (23)(1)(B) OF THE ACT (23)(1)(B) OF THE ACT. WE ONCE AGAIN REPEAT THAT WHETHER SUCH NOTIONAL INTEREST COULD FORM PART OF THE FAIR RENT UNDER SECTION (23)(1)(A) IS EXPRESSLY LEFT OPEN. 14. IT IS, THUS, MANIFEST THAT VARIOUS COURTS HAVE HELD A CONSISTENT VIEW THAT NOTIONAL INTEREST CANNOT FORM PART OF ACTUAL RENT. HENCE, THERE IS NO JUSTIFICATION TO TAKE A DIFFERENT VIEW THAT WHAT HAS BEEN STATED IN ASIAN H OTELS ASIAN HOTELS ASIAN HOTELS ASIAN HOTELS LIMITED (SUPRA) LIMITED (SUPRA) LIMITED (SUPRA) LIMITED (SUPRA). 15. THE NEXT QUESTION WOULD BE AS TO WHETHER THE AN NUAL LETTING VALUE FIXED BY THE MUNICIPAL AUTHORITIES UN DER 7 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) THE DELHI MUNICIPAL AUTHORITY ACT CAN BE THE BASIS OF ADOPTING ANNUAL LETTING VALUE FOR THE PURPOSES OF S ECTION 23 OF THE ACT. THIS QUESTION WAS ANSWERED IN AFFIRM ATIVE BY THE CALCUTTA HIGH COURT IN SATYA CO SATYA CO SATYA CO SATYA CO. LTD. (SUPRA) . LTD. (SUPRA) . LTD. (SUPRA) . LTD. (SUPRA) ON THE GROUND THAT THE PROVISIONS CONTAINED IN THE DEL HI MUNICIPAL CORPORATION ACT FOR FIXING ANNUAL LETTING VALUE IS PARI MATERIA WITH SECTION 23 OF THE ACT. THE COU RT OPINED THAT THE FAIR RENT FIXED UNDER THE MUNICIPAL LAWS, WHICH TAKES INTO CONSIDERATION EVERYTHING, WOULD FO RM THE BASIS OF ARRIVING AT ANNUAL VALUE TO BE DETERMI NED UNDER SECTION 23(1)(A) AND TO BE COMPARED WITH ACTU AL RENT AND NOTIONAL ADVANTAGE IN THE FORM OF NOTIONAL INTEREST ON INTEREST FREE SECURITY DEPOSIT COULD NO T BE TAKEN INTO CONSIDERATION. IT IS CLEAR FROM THE FOLL OWING DISCUSSION THEREIN: 6. WITH REGARD TO QUESTION NOS. (5) AND (6) WHICH ARE ONLY FOR THE ASST. YRS. 1984-85 AND 1985-86 THE FURTHER ISSUE INVOLVED IS WHETHER ANY ADDITION TO T HE ANNUAL RENTAL VALUE CAN BE MADE WITH REFERENCE TO ANY NOTIONAL INTEREST ON THE DEPOSIT MADE BY THE TENANT. WHEN THE ANNUAL VALUE IS DETERMINED UNDER SUB-CL. (A) OF SUB-S. (1) OF S. 23 WITH REFERENCE T O THE FAIR RENT THEN TO SUCH VALUE NO FURTHER ADDITION CA N BE MADE. THE FAIR RENT, TAKES INTO CONSIDERATION EVERYTHING. THE NOTIONAL INTEREST ON THE DEPOSIT IS NOT ANY ACTUAL RENT RECEIVED OR RECEIVABLE. UNDER SUB-C L. (B) OF S. 23(1) ONLY THE ACTUAL RENT RECEIVED OR RECEIVABLE CAN BE TAKEN INTO CONSIDERATION AND NOT ANY NOTIONAL ADVANTAGE. THE RENT IS AN ACTUAL SUM O F MONEY WHICH IS PAYABLE BY THE TENANT FOR USE OF THE PREMISES TO THE LANDLORD. ANY ADVANTAGE AND/OR PERQUISITE CANNOT BE TREATED AS RENT. WHEREVER ANY SUCH PERQUISITE OR BENEFIT IS SOUGHT TO BE TREATED AS INCOME, SPECIFIC PROVISIONS IN THAT BEHALF HAVE BEE N MADE IN THE ACT BY INCLUDING SUCH BENEFIT, ETC., IN THE DEFINITION OF THE INCOME UNDER S. 2(24) OF THE ACT. SPECIFIC PROVISIONS HAVE ALSO BEEN MADE UNDER DIFFERENT HEADS FOR ADDING SUCH BENEFITS OR PERQUISITES AS INCOME WHILE COMPUTING INCOME UNDER THOSE HEADS, E.G., SALARY, BUSINESS. THE COMPUTATIO N OF THE INCOME UNDER THE HEAD HOUSE PROPERTY IS ON A DEEMED BASIS. THE TAX HAS TO BE PAID BY REASON OF T HE OWNERSHIP OF THE PROPERTY. EVEN IF ONE DOES NOT INC UR 8 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) ANY SUM ON ACCOUNT OF REPAIRS, A STATUTORY DEDUCTIO N THEREFORE IS ALLOWED AND WHERE ON REPAIRS EXPENSES ARE INCURRED IN EXCESS OF SUCH STATUTORY LIMIT, NO DEDUCTION FOR SUCH EXCESS IS ALLOWED. THE DEDUCTION S FOR MUNICIPAL TAXES AND REPAIRS ARE NOT ALLOWED TO THE EXTENT THEY ARE BORNE BY THE TENANT. HOWEVER, EVEN SUCH ACTUAL REIMBURSEMENTS FOR MUNICIPAL TAXES, INSURANCE, REPAIRS OR MAINTENANCE OF COMMON FACILITIES ARE NOT CONSIDERED AS PART OF THE RENT A ND ADDED TO THE ANNUAL VALUE. ACCORDINGLY, THERE CAN B E NO SCOPE OR JUSTIFICATION WHATSOEVER FOR MAKING ANY ADDITION FOR ANY NOTIONAL INTEREST FOR DETERMINING THE ANNUAL VALUE. WHATEVER BENEFIT OR ADVANTAGE WHICH I S DERIVED FROM THE DEPOSITS - WHETHER BY WAY OF SAVIN G OF INTEREST OR OF EARNING INTEREST OR MAKING PROFIT S BY INVESTING SUCH DEPOSIT - THE SAME WOULD BE REFLECTE D IN COMPUTING THE INCOME OF THE ASSESSEE UNDER OTHER HEADS. IN OUR VIEW THERE IS NO SCOPE FOR MAKING ANY ADDITION ON ACCOUNT OF SO-CALLED NOTIONAL INTEREST ON THE DEPOSIT MADE BY THE TENANT, SINCE THERE IS NO PROVISION TO THIS EFFECT IN S. 22 OR 23 OF THE IT A CT, 1961. 16. IN FACT, THIS IS THE VIEW TAKEN EVEN BY THE SUP REME COURT IN THE CASE OF SHIELA KAUSHISH VS. CIT SHIELA KAUSHISH VS. CIT SHIELA KAUSHISH VS. CIT SHIELA KAUSHISH VS. CIT [1981] 131 [1981] 131 [1981] 131 [1981] 131 ITR 435 (SC) ITR 435 (SC) ITR 435 (SC) ITR 435 (SC) ON ACCOUNT OF SIMILARITY OF THE PROVIS IONS UNDER THE MUNICIPAL ENACTMENTS AND SECTION 23 OF TH E ACT. 17. IT IS ON THIS BASIS THAT IN THE PRESENT CASE, T HE CIT (A) GAVE PRIMACY TO THE RATEABLE VALUE OF THE PROPE RTY FIXED BY THE MUNICIPAL CORPORATION OF DELHI VIDE IT S ASSESSMENT ORDER DATED 31.12.1996 AND ON THIS BASIS , OPINED THAT THE ACTUAL RENT WAS MORE THAN THE SAID RATEABLE VALUE AND THEREFORE, AS PER SECTION 23 (1) (B), THE ACTUAL RENT WOULD BE THE INCOME FROM HOUSE PROPERTY AND THERE COULD NOT HAVE BEEN ANY FURTHER ADDITIONS. 18. SINCE THE PROVISIONS OF FIXATION OF ANNUAL RENT UNDER THE DELHI MUNICIPAL CORPORATION ACT ARE PARI MATERI A OF SECTION 23 OF THE ACT, WE ARE INCLINED TO ACCEPT TH E AFORESAID VIEW OF THE CALCUTTA HIGH COURT IN SATYA CO. SATYA CO. SATYA CO. SATYA CO. 9 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) LTD. (SUPRA) LTD. (SUPRA) LTD. (SUPRA) LTD. (SUPRA) THAT IN SUCH CIRCUMSTANCES, THE ANNUAL VALUE FIXED BY THE MUNICIPAL AUTHORITIES CAN BE A RATIONA LE YARDSTICK. HOWEVER, IT WOULD BE SUBJECT TO THE COND ITION THAT THE ANNUAL VALUE FIXED BEARS A CLOSE PROXIMITY WITH THE ASSESSMENT YEAR IN QUESTION IN RESPECT OF WHICH THE ASSESSMENT IS TO BE MADE UNDER THE INCOME TAX LAWS. IF THERE IS A CHANGE INCIRCUMSTANCES BECAUSE OF PASSAG E OF TIME, VIZ., THE ANNUAL VALUE WAS FIXED BY THE MUNIC IPAL AUTHORITIES MUCH EARLIER IN POINT OF TIME ON THE BA SIS OF RENT THAN RECEIVED, THIS MAY NOT PROVIDE A SAFE YAR DSTICK IF IN THE ASSESSMENT YEAR IN QUESTION WHEN ASSESSME NT IS TO BE MADE UNDER INCOME TAX ACT. THE PROPERTY IS LET- OUT AT A MUCH HIGHER RENT. THUS, THE AO IN A GIVEN CASE CAN IGNORE THE MUNICIPAL VALUATION FOR DETERMINING ANNUAL LETTING VALUE IF HE FINDS THAT THE SAME IS N OT BASED ON RELEVANT MATERIAL FOR DETERMINING THE FAI R RENT IN THE MARKET AND THERE IS SUFFICIENT MATERIAL ON RECORD FOR TAKING A DIFFERENT VALUATION. WE MAY PROFITABLY REPRODUCE THE FOLLOWING OBSERVATIONS OF THE SUPREME COURT IN THE CASE OF CORPORATION OF CALCUTT A VS. CORPORATION OF CALCUTTA VS. CORPORATION OF CALCUTTA VS. CORPORATION OF CALCUTTA VS. SMT. PADMA DEBI, SMT. PADMA DEBI, SMT. PADMA DEBI, SMT. PADMA DEBI, AIR 1962 SC AIR 1962 SC AIR 1962 SC AIR 1962 SC 151: A BARGAIN BETWEEN A WILLING LESSOR AND A WILLING LESSEE UNINFLUENCED BY ANY EXTRANEOUS CIRCUMSTANCES MAY AFFORD A GUIDING TEST OF REASONABLENESS. AN INFLATED OR DEFLATED RATE OF REN T BASED UPON FRAUD, EMERGENCY, RELATIONSHIP AND SUCH OTHER CONSIDERATIONS MAY TAKE IT OUT OF THE BOUNDS OF REASONABLENESS. 16. THUS THE RATEABLE VALUE, IF CORRECTLY DETERMINED, UNDER THE MUNICIPAL LAWS CAN BE TAKEN AS ALV UNDER SECTION 23(1)(A) OF THE ACT. TO THAT EXTENT WE AGREE WITH THE CONTENTION OF THE LEARNED COUNSEL OF THE ASSESSEE. HOWEVER, WE MAKE IT CLEAR THAT RATEABLE VALUE IS NOT BINDING ON THE ASSESSING OFFICER. IF THE ASSESSING OFFICER CAN SHOW THAT RATEABLE VALUE UNDER MUNICIPAL LAWS DOES NOT REPRESENT THE CORRECT FAIR RENT, THEN HE MAY DETERMINE THE SAME ON THE BASIS OF MATERIAL/ EVIDENCE PLACED ON RECORD. THIS VIEW IS FORTIFIED BY THE DECISION OF PATNA HIGH COURT IN THE CASE OF KASHI PRASAD KASHI PRASAD KASHI PRASAD KASHI PRASAD KATARUKA V. CIT [1975] 101 ITR 810 KATARUKA V. CIT [1975] 101 ITR 810 KATARUKA V. CIT [1975] 101 ITR 810 KATARUKA V. CIT [1975] 101 ITR 810. 10 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) 17. THE ABOVE DISCUSSION LEADS TO THE FOLLOWING CONCLUSIONS: (I) ALV WOULD BE THE SUM AT WHICH THE PROPERTY MAY BE REASONABLY LET OUT BY A WILLING LESSOR TO A WILLING LESSEE UNINFLUENCED BY ANY EXTRANEOUS CIRCUMSTANCES, (II) (II) AN INFLATED OR DEFLATED RENT BASED ON EXTRANEOUS CONSIDERATION MAY TAKE IT OUT OF THE BOUNDS OF REASONABLENESS, (III) ACTUAL RENT RECEIVED, IN NORMAL CIRCUMSTANCES , WOULD BE A RELIABLE EVIDENCE UNLESS THE RENT IS INFLATED/DEFLATED BY REASON OF EXTRANEOUS CONSIDERATION, (IV) SUCH ALV, HOWEVER, CANNOT EXCEED THE STANDARD RENT AS PER THE RENT CONTROL LEGISLATION APPLICABLE TO THE PROPERTY, (V) IF STANDARD RENT HAS NOT BEEN FIXED BY THE RENT CONTROLLER, THEN IT IS THE DUTY OF THE ASSESSING OF FICER TO DETERMINE THE STANDARD RENT AS PER THE PROVISION S OF RENT CONTROL ENACTMENT, (VI) THE STANDARD RENT IS THE UPPER LIMIT, IF THE F AIR RENT IS LESS THAN THE STANDARD RENT, THEN IT IS THE FAIR RENT WHICH SHALL BE TAKEN AS ALV AND NOT THE STANDARD RENT. 19. WE MAY ALSO ADD THAT IN PLACE LIKE DELHI, THIS HAS NOW BECOME REDUNDANT INASMUCH AS THE VERY BASIS OF FIXING PROPERTY TAX HAS UNDERGONE A TOTAL CHANGE WITH AMENDMENT OF THE MUNICIPAL LAWS BY AMENDMENT ACT, 2003. NOW THE PROPERTY TAX IS ON UNIT METHOD BASIS. 20. IN THE PRESENT CASE, THE AO ADDED NOTIONA L INTEREST ON THE INTEREST FREE SECURITY FOR ARRIVING AT ANNUAL LETTING VALUE. SINCE THAT WAS NOT PERMISSIBL E, THE EFFECT WOULD BE THAT SUCH ASSESSMENT WAS RIGHTLY SE T ASIDE BY THE CIT (A) AND THE TRIBUNAL. THEREFORE, T HE ORDERS WOULD NOT CALL FOR ANY INTERFERENCE. THESE A PPEALS ARE, THUS, DISMISSED ON THIS GROUND. ONCE WE HOLD T HIS, THE VERY BASIS ADOPTED BY THE AO TO FIX ANNUAL LETT ING VALUE WAS WRONG AND THEREFORE, NO FURTHER EXERCISE IN FACT IS REQUIRED BY US IN THESE APPEALS. 11 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) 21. WE WOULD LIKE TO REMARK THAT STILL THE QUESTION REMAINS AS TO HOW TO DETERMINE THE REASONABLE/FAIR RENT. IT HAS BEEN INDICATED BY THE SUPREME COURT THAT EXTRANEOUS CIRCUMSTANCES MAY INFLATE/DEFLATE THE F AIR RENT . THE QUESTION WOULD, THEREFORE, BE AS TO WHAT WOULD BE CIRCUMSTANCES WHICH CAN BE TAKEN INTO CONSIDERATION BY THE AO WHILE DETERMINING THE FAIR RENT. IT IS NOT NECESSARY FOR US TO GIVE ANY OPINION IN T HIS BEHALF, AS WE ARE NOT CALLED UPON TO DO SO IN THESE APPEALS. HOWEVER, WE MAY OBSERVE THAT NO PARTICULAR TEST CAN BE LAID DOWN AND IT WOULD DEPEND ON FACTS OF EACH CASE. WE WOULD DO NOTHING MORE THAN TO EXTRACT THE FOLLOWING PASSAGE FROM THE SUPREME COURT JUDGME NT IN THE CASE OF MOTICHAND HIRACHAND VS. BO MOTICHAND HIRACHAND VS. BO MOTICHAND HIRACHAND VS. BO MOTICHAND HIRACHAND VS. BOMBAY MUNICIPAL MBAY MUNICIPAL MBAY MUNICIPAL MBAY MUNICIPAL CORPORATION, CORPORATION, CORPORATION, CORPORATION, AIR 1968 SC 441 AIR 1968 SC 441 AIR 1968 SC 441 AIR 1968 SC 441: IT IS WELL-RECOGNIZED PRINCIPLE IN RATING THAT BOTH GROSS VALUE AND NET ANNUAL VALUE ARE ESTIMATED BY REFERENCE TO THE RENT AT WHICH THE PROPERTY MIGHT REASONABLY BE EXPECTED TO LET FROM YEAR TO YEAR, VARIOUS METHODS OF VALUATION ARE APPLIED IN ORDER TO ARRIVE AT SUCH HYPOTHETICAL REN T, FOR INSTANCE, BY REFERENCE TO THE ACTUAL RENT PAID FOR THE PROPERTY OR FOR OTHERS COMPARABLE TO IT OR WHERE THERE ARE NO RENTS BY REFERENCE TO THE ASSESSMENTS OF COMPARABLE PROPERTIES OR TO THE PROFITS CARRIED FROM THE PROPERTY OR TO THE COST OF CONSTRUCTION.' 22. WE HAVE ALSO TAKEN NOTE OF THE JUDGMENT OF THE BOMBAY HIGH COURT IN THE CASE OF J.K. INVESTORS J.K. INVESTORS J.K. INVESTORS J.K. INVESTORS (SUPRA) WHEREIN THE COURT HINTED THAT VARIOUS FACTORS MAY BECOME RELEVANT IN DETERMINING THE FAIR RENT . THE PRECISE OBSERVATIONS OF THE COURT IN THE SAID JUDGM ENT ARE AS UNDER: AT THE COST OF REPETITION IT MAY BE MENTIONED THAT UNDER SECTION (23)(1)(A), THE SECTION (23)(1)(A), THE SECTION (23)(1)(A), THE SECTION (23)(1)(A), THE ASSESSING OFFICER HAS TO DECIDE THE FAIR RENT OF TH E ASSESSING OFFICER HAS TO DECIDE THE FAIR RENT OF TH E ASSESSING OFFICER HAS TO DECIDE THE FAIR RENT OF TH E ASSESSING OFFICER HAS TO DECIDE THE FAIR RENT OF TH E PROPERTY. WHI PROPERTY. WHI PROPERTY. WHI PROPERTY. WHILE DECIDING THE FAIR RENT, VARIOUS LE DECIDING THE FAIR RENT, VARIOUS LE DECIDING THE FAIR RENT, VARIOUS LE DECIDING THE FAIR RENT, VARIOUS 12 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) FACTORS COULD BE TAKEN INTO ACCOUNT. IN SUCH CASES FACTORS COULD BE TAKEN INTO ACCOUNT. IN SUCH CASES FACTORS COULD BE TAKEN INTO ACCOUNT. IN SUCH CASES FACTORS COULD BE TAKEN INTO ACCOUNT. IN SUCH CASES VARIOUS METHODS LIKE THE CONTRACTORS METHOD COULD VARIOUS METHODS LIKE THE CONTRACTORS METHOD COULD VARIOUS METHODS LIKE THE CONTRACTORS METHOD COULD VARIOUS METHODS LIKE THE CONTRACTORS METHOD COULD BE TAKEN INTO ACCOUNT BE TAKEN INTO ACCOUNT BE TAKEN INTO ACCOUNT BE TAKEN INTO ACCOUNT. IF ON COMPARISON OF THE FAIR RENT WITH THE ACTUAL RENT RECEIVED, THE ASSESSING OFFICER FINDS THAT THE ACTUAL RENT RECEIVED IS MORE THAN THE FAIR RENT DETERMINABLE AS ABOVE, THEN THE ACTUAL RENT SHALL CONSTITUTE THE ANNUAL VALUE UNDER SECTION (23)(1)(B) OF THE ACT. NOW, APPLYING THE ABOVE TEST TO THE FACTS OF THIS CASE, WE FIND A CATEGORICAL FINDING OF FACT RECORDED BY THE TRIBUNA L THAT THE ACTUAL RENT RECEIVED BY THE ASSESSEE WAS MORE THAN THE FAIR RENT. UNDER THE ABOVE CIRCUMSTANCES, IN VIEW OF THE SAID FINDING OF FACT, WE DO NOT SEE ANY REASON TO INTERFERE. 29. FROM THE DECISION OF THE HON.FULL BENCH OF TH E HON. DELHI HIGH COURT, IT IS CLEAR THAT FOR DETERMINATIO N OF THE FAIR RENT, THE AO HAS TO TAKE INTO ACCOUNT VARIOUS FACT ORS INCLUDING STANDARD RENT. IF THE STANDARD RENT IS NOT FIXED THEN THE PROCEDURE PROVIDED UNDER THE RENT CONTROL ACT FOR FIXATION OF STANDARD RENT HAS TO BE TAKEN INTO CONSIDERATION. W E MAY MENTION THAT MUNICIPAL VALUE OR STANDARD RENT ITSE LF IS NOT SOLE BINDING FACTORS ON THE AO BUT THESE ARE ONLY GUIDING FACTOR FOR DETERMINING THE REASONABLE EXPECTED REN T TO BE FETCHED BY HE PROPERTY AS CONTEMPLATED U/S 23 (1)( A). IF IN THE GIVEN CASE, THE AO FINDS THAT THE MUNICIPAL VALUE I S NOT BASED ON RELEVANT MATERIAL FOR DETERMINING FAIR RENT IN THE MARKET AND THERE IS A SUFFICIENT MATERIAL ON RECORD FOR TA KING DIFFERENT VALUATION THEN THE AO CAN DETERMINE THE FAIR RENT B Y INFLATING OR DEFLECTING THE MUNICIPAL VALUE OR STANDARD RE NT AS THE CASE MAY BE BY TAKING INTO ACCOUNT THE RELEVANT MA TERIAL IN THIS REGARD. AS OBSERVED BY THE HON. DELHI HIGH COU RT IF THE RATABLE VALUE IS CORRECTLY DETERMINED UNDER THE MU NICIPAL LAW THE SAME CAN BE TAKEN AS ANNUAL LETTING VALUE U/S 23(1)(A) OF THE ACT. HOWEVER, THE RATABLE VALUE IS NOT A BIND ING ON THE AO IF THE AO CAN SHOW THAT THE RATABLE VALUE UNDE R MUNICIPAL LAW DOES NOT REPRESENT THE CORRECT FAIR RENT. IF THE AO FINDS THAT THE ACTUAL RENT RECEIVED IS LESS THAN THE FAI R MARKET RENT/MARKET RENT BECAUSE OF THE REASON THAT THE AS SESSEE HAS RECEIVED ABNORMALLY HIGH INTEREST FREE SECURITY DEP OSITS AND BECAUSE OF THAT REASON ACTUAL RENT RECEIVED IS LE SS THAN THE RENT WHICH THE PROPERTY MIGHT FETCH HE CAN UNDERTAK E NECESSARY EXERCISE IN THAT BEHALF. HOWEVER, THE N OTIONAL INTEREST ON INTEREST FREE SECURITY CANNOT BE TAKEN AS DETERMINATIVE FACTOR TO ARRIVE AT FAIR RENT. IF THE AO FINDS THAT THE RATABLE VALUE UNDER THE MUNICIPAL LAW DOES NO T REPRESENT CORRECT FAIR RENT AND THEN HE MAY DETERMINE THE SAM E ON THE BASIS OF MATERIAL/EVIDENCE PLACED ON RECORD. THE HO N. FULL BENCH OF THE DELHI HIGH COURT HAS OBSERVED IN PARA GRAPHS 21 OF THE DECISION THAT TO DETERMINE THE REASONABLE/FA IR RENT 13 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) EXTRANEOUS CIRCUMSTANCES MAY INFLECT OR DEFLECT THE FAIR RENT WHICH CAN BE TAKEN INTO CONSIDERATION BY THE AO. SINCE, THE REASONABLE RENT U/S 23(1)(A) HAS NOT BEEN DETERMINE D. THE MUNICIPAL VALUE OR STANDARD RENT WAS ALSO NOT BEFO RE THE AO AS WELL AS CIT(A). AND IT IS ALSO NOT CLEAR FROM T HE RECORD AS UNDER WHICH CLAUSE, THE AO HAS MADE THIS ADDITION. ACCORDINGLY WE RESTORE THE ISSUE TO RECORD OF THE AO AND DIRECT THE AO TO DETERMINE THE SUM FOR WHICH THE P ROPERTY MIGHTY REASONABLY EXPECTED TO LET FROM YEAR TO YEAR U/S 23(1)(A) AFTER CONSIDERING ALL RELEVANT FACTORS A S DISCUSSED ABOVE AND THEREAFTER COMPARED THE SAME WITH THE AN NUAL RENT RECEIVED OR RECEIVABLE BY THE ASSESSEE U/S 23(1)(B) AND THEN DECIDE THE ISSUE AS PER LAW. 5 IN THE CASE IN HAND, THOUGH, THE ASSESSING OFFICE R MADE AN ENQUIRY ABOUT THE FAIR MARKET RENT OF THE PROPERTY AND HAS GIVEN A FINDING THAT DUE TO INTEREST FREE DEPOSIT RECEIVED BY THE ASSESSEE, ACTUAL RENT OF THE PROPERTY IS DEFLATED. HOWEVER, THE ASSESSING OFFICER, WHILE DETERMINING THE FAIR MARKET RENT U/S 23(1)(A) HAS DIRECTLY ADDED 10% OF THE INTEREST FREE DEPOSIT BEI NG THE BANK INTEREST RATE PREVAILING ON FD. IN VIEW OF THE FUL L BENCH DECISION OF THE HONBLE DELHI HIGH COURT CITED SUPRA, NO ADDITI ON CAN BE MADE ON NOTIONAL INTEREST ON THE INTEREST FREE SECURITY DEPOSIT WHILE DETERMINING THE ALV U./S 23(1)(A). 6 SINCE THE COORDINATE BENCH WHILE PASSING THE ORDE R IN CASE OF RECLAMATION REALITY INDIA P LTD (SUPRA)DID NOT HAV E THE BENEFIT OF THE FULL BENCH DECISION OF THE HONBLE DELHI HIGH C OURT, IN THE CASE OF MONI KUMAR SUBBA (SUPRA) AND NOW THE ISSUE IS SE TTLED BY THE FULL BENCH OF THE DECISION HONBLE DELHI HIGH COURT; THE REFORE, WE SET ASIDE THE ISSUE TO THE RECORD OF THE ASSESSING OFFI CER WITH A 14 ITA NOS. 780 TO 782/MUM/2009 (ASST YEARS 2003-04 TO 205-06 ) DIRECTION TO RE-ADJUDICATE THE ISSUE IN TERMS OF TH E FULL BENCH DECISION OF THE HONBLE DELHI HIGH COURT CITED SUPR A. WE HOLD AND DIRECT ACCORDINGLY. 6 IN THE RESULT, THE APPEALS FILED BY THE REVENUE A RE ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON THE 27 TH , DAY OF MAY 2011. SD/- SD/- ( (( ( P M JAGTAP P M JAGTAP P M JAGTAP P M JAGTAP ) )) ) ACCOUNTANT MEMBER ( (( ( VIJAY PAL RAO VIJAY PAL RAO VIJAY PAL RAO VIJAY PAL RAO ) )) ) JUDICIAL MEMBER PLACE: MUMBAI : DATED:27 TH , MAY 2011 RAJ* COPY FORWARDED TO: 1 APPELLANT 2 RESPONDENT 3 CIT 4 CIT(A) 5 DR /TRUE COPY/ BY ORDER DY /AR, ITAT, MUMBAI