2022 (8) TMI 740 - AT - Income Tax

Addition under the head salaries as based on Form No. 26AS - declining the claim of deduction u/s 10 regarding house rent paid by him - HELD THAT - As relying on JUSTICE SC. MITTAL 1979 (11) TMI 92 - PUNJAB AND HARYANA HIGH COURT and MS GUJRAL, CHIEF JUSTICE, SIKKIM HIGH COURT 1979 (12) TMI 41 - PUNJAB AND HARYANA HIGH COURT case the assessee is entitled for deduction u/s 10(13A) in respect of expenditure made towards rent. The appeal of the assessee is partly allowed. Rest of the action of learned CIT(Appeals) is sustained. Hence the grounds raised in this appeal are partly allowed.

Summary

Issues:
1. Assessment of salary income.
2. Claim of deduction under Section 10 for house rent.
3. Absence of the appellant during the proceedings.

Assessment of Salary Income:
The appellant filed the return of income declaring total income as Nil, which was selected for scrutiny. The Assessing Officer assessed the income at Rs. 25,41,860, which was later reduced to Rs. 25,02,107 by the CIT(Appeals). The appellant raised concerns regarding the addition made under the head of salaries without proper consideration of the facts of the case. The appellant's absence during the proceedings led to the case being decided based on available records. The Senior DR defended the Assessing Officer's assessment, stating no infirmity in the order.

Claim of Deduction under Section 10 for House Rent:
The primary grievance of the appellant was the denial of the deduction under Section 10 regarding house rent paid amounting to Rs. 4,04,060. The appellant cited precedents from a Division Bench of the Tribunal and High Courts to support the claim. The judgment referred to the provisions of Section 10(13A), emphasizing the requirement for an allowance granted by the employer to meet actual rent expenditure for residential accommodation. The judgment analyzed the case law and concluded that the appellant fulfilled the conditions for exemption under Section 10(13A). Citing relevant High Court judgments, the Tribunal allowed the deduction under Section 10(13A) for the appellant's rent expenditure.

Absence of the Appellant during Proceedings:
During the hearing, no one represented the appellant, leading to the case being decided based on existing records. Despite the absence of the appellant, the Tribunal thoroughly examined the material available and made a decision based on the arguments presented by the Senior DR. The appellant's absence did not hinder the Tribunal from assessing the case and delivering a judgment based on the merits presented.

In conclusion, the Tribunal partially allowed the appellant's appeal concerning the deduction under Section 10(13A) for house rent while upholding the rest of the CIT(Appeals) actions. The judgment highlighted the importance of fulfilling statutory requirements for claiming deductions and emphasized the significance of legal precedents in supporting such claims.