9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (2) TMI 97 - AT - Income TaxOption u/s 23(4) to choose one property as self-occupied - assessee in possession of 3 properties out of which one is partly let out and partly self occupied property at Malviya Nagar, Delhi stated to be self-occupied in ROI assessee during assessment proceedings exercised the option u/s 23(4) in favor of property at GK-1 and offered Malviya nagar property as deemed to be let out Revenue contending otherwise - Held that - In addition to aforesaid, even Palam Vihar property is stated to be partly let out and partly self occupied in ROI. We find that neither the AO nor CIT(A) recorded any findings as to which are the properties in the instant case which fall within the purview of s. 23(2) In these circumstances, we restore the matter to the file of the AO with the directions to identify the properties which fall within the purview of s. 23(2) and allow the assessee option mentioned in s.23(4) - Decided in favor of assessee for statistical purposes.
Issues Involved:
1. Addition of Rs. 6,00,000/- on account of deemed rental value of the Greater Kailash-I (GK-I) property. 2. Validity of the assessment order passed by the Assessing Officer (AO). 3. Charging of interest under section 234-B of the Income Tax Act, 1961. Issue-Wise Detailed Analysis: 1. Addition of Rs. 6,00,000/- on account of deemed rental value of the Greater Kailash-I (GK-I) property: The AO noticed the assessee was in occupation of three properties: Palam Vihar, Greater Kailash Enclave, and Malviya Nagar. The assessee claimed Palam Vihar was let out, GK-I was self-occupied, and Malviya Nagar was self-occupied by his brother. The AO, based on an Inspector's report, concluded that the GK-I property was vacant and could fetch a rent of Rs. 50,000/- per month, leading to an addition of Rs. 6,00,000/- as deemed rental value. The assessee argued that GK-I was self-occupied, supported by bank statements and electricity bills showing residence at GK-I. The assessee also contended that the Inspector's report was obtained without his knowledge, violating natural justice principles. The CIT(A) upheld the AO's decision, stating that the address in the return (Malviya Nagar) was presumed to be the residential address, and the electricity bills and bank statements did not conclusively prove residence at GK-I. The CIT(A) also noted that if GK-I were accepted as self-occupied, deemed income from another property would need to be taxed. Upon appeal, it was argued that the assessee has the right to choose one property as self-occupied under section 23(4) of the Act. The Tribunal agreed that the law provides the assessee the option to choose any one property as self-occupied and that the AO or CIT(A) cannot impose their choice. The Tribunal directed the AO to identify properties under section 23(2) and allow the assessee to choose one as self-occupied, then determine the annual letting value (ALV) accordingly. 2. Validity of the assessment order passed by the Assessing Officer (AO): The assessee contended that the assessment order was based on incorrect facts, findings, and without adequate opportunity for hearing or cross-examination. The Tribunal noted that the AO did not record findings on which properties fell under section 23(2) and did not give the assessee the opportunity to rebut the Inspector's report. The Tribunal restored the matter to the AO for re-adjudication, directing the AO to allow the assessee to choose the self-occupied property and complete the assessment in accordance with the law. 3. Charging of interest under section 234-B of the Income Tax Act, 1961: Since the issues were restored to the AO for re-adjudication, the ground relating to the levy of interest under section 234-B did not survive for adjudication at this stage. Conclusion: The Tribunal allowed the appeal for statistical purposes, directing the AO to re-adjudicate the matter by identifying properties under section 23(2), allowing the assessee to choose one as self-occupied, and determining the ALV accordingly. The Tribunal emphasized the need for the AO to provide a fair opportunity for the assessee to present relevant facts and evidence.
|
