2016 (1) TMI 1335 - AT - Income Tax

Determining the ALV of the property as fixed by the Municipal authorities - Held that - As perused the orders furnished before us in the case of the assessee and his wife and find that there is no material difference in the orders passed in earlier years and this year. No new material has come on record to suggest that the ALV of the vacant flats should not be fixed at some other value other than the Municipal value. There is no change in fact therefore, the contention of the Ld. DR that during this year there are materials to show that the ALV is more than the Municipal valuation may not be correct. - Decided in favour of the assessee

Summary

Issues:
Challenging the determination of Annual Letting Value (ALV) of property as fixed by Municipal authorities for assessment years 2008-09 & 2009-10.

Analysis:
The Revenue appealed against the Ld. CIT(A)'s order regarding the ALV determination of the property by Municipal authorities. The Ld. Counsel for the assessee highlighted that a similar issue was decided in favor of the assessee in previous years by the Tribunal. The Ld. Departmental Representative argued that new materials indicated a higher ALV than the Municipal value for the current assessment year. However, the Ld. Counsel countered by referencing a previous case involving the same Inspector's report, where the ALV was upheld based on Municipal valuation. The Tribunal noted no significant change in circumstances and upheld the ALV based on Municipal ratable value, in line with previous decisions and High Court rulings.

The Tribunal reviewed the orders and relevant findings, emphasizing that the ALV based on Municipal ratable value is an accepted valuation method for vacant premises. Referring to various Tribunal decisions, the Tribunal upheld that the ALV for vacant flats can be determined at the Municipal ratable value. Additionally, the Tribunal cited a High Court ruling that supported accepting Municipal ratable value for ALV determination, emphasizing the need for concrete evidence to challenge the prevailing rates. The Tribunal concluded in favor of the assessee, aligning with previous Tribunal decisions and High Court principles.

In a separate case involving the assessee's wife, the Tribunal analyzed the ALV computation method by the Assessing Officer, which was challenged by the assessee. The CIT(A) supported the assessee's method based on rateable values determined by Municipal Authorities, citing relevant High Court judgments. The Tribunal upheld the CIT(A)'s decision, emphasizing the binding nature of the High Court judgment and dismissing the Revenue's grounds. The Tribunal decided in favor of the assessee, rejecting the Revenue's appeal and supporting the CIT(A)'s order based on legal precedents and factual analysis.

In conclusion, both appeals by the Revenue were dismissed by the Tribunal based on the consistent application of legal principles, previous Tribunal decisions, and High Court rulings. The Tribunal upheld the ALV determination based on Municipal ratable value, rejecting the Revenue's challenges and supporting the decisions of the CIT(A) in both cases.