9911796707
TMI Blog2008 (2) TMI 523X X X X Extracts X X X X X X X X Extracts X X X X ..... in the computation of the income under the said head of income only in terms of its provisions, would not be entitled to the impugned deductions, we consider that the annual value of its house property be assumed at the reduced value, i.e., after deducting the impugned amounts (from the rental), being only in relation to the expenditure required to be necessarily incurred for the enjoyment/user of the relevant property and, therefore, can only be considered as having been included at the said amount, i.e., at cost, by the two parties in the reckoning/determining of the same (rental). We decide accordingly. We may also add that the standard deduction admissible to the assessee on account of repairs @ 1/6th of the annual value of its house pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds: "1. In facts and circumstances of the case, your appellant most respectfully submits that the learned AO had erred in disallowing claim of expenditure incurred on salary and bonus paid to pumpman, sweepers, liftman of Rs. 89,100 and Rs. 20,300 respectively and electricity charges of Rs. 41,764 being expenses incurred for electric burning for pump motor, common passage and lift. Though the said expenditure were in the nature of obligatory expenses on part of your appellant to earn rental income and for contractual obligation to the tenants and therefore being in the nature of direct charge against rental income itself under s. 22 of the Act and the learned CIT(A) has further erred in confirming the said addition on the ground that no su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onus of sweepers, pumpmen and liftman 20,200 (3) Electric burning for pump motor and 41,764 common passage -------- 1,51,164 -------- As the said expenses stood not covered under ss. 23 and 24 of the Act, the assessee was denied the said claimed deductions by the AO, relying for the purpose on the decision in the cases of CIT vs. H.G. Gupta & Sons (1984) 42 CTR (Del) 178 : (1984) 149 ITR 253 (Del) and CIT vs. Sreelekha Banerjee (1989) 179 ITR 46 (Cal). The same stood confirmed in first appeal. Aggrieved, the assessee is in appeal before us. 4. Before us the learned Authorised Representative, the assessee's counsel, submitted that the said expenditure was obligatory on the assessee's part, so that the same had to be incurred for e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purposes of its business or profession by it. The rent being charged by the assessee, if so, is only a surrogate measure of the said annual value. The expenditure on the aforesaid items, i.e., the salary (including bonus) to the maintenance staff of the facilities as electric motors, lift, cleaning, etc., as well as that on the electricity consumed in respect of any common area and the electric motors, is not attributable directly to the house property as such, but to its enjoyment by the tenants/users thereof. In a given case it may well be that the said expenditure is incurred by the tenant or tenants (collectively), with the landlord having no locus standi or role therein, so that who incurs the same in the first instance, is only a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce of the facilities enjoined therewith, and necessary for its useful enjoyment. Also, the case law cited by the Revenue in support of its case would not be relevant, being in relation to different propositions, and which do not stand in any manner contradicted by the decision in the present case, which stands decided on the basis of its relevant facts. 6. The assessee's second ground relates to the direction by the learned CIT(A) for assessing the additional rent (Rs. 4,01,601) received by the assessee from its tenants in respect of its house property under the head "Income from other sources", i.e., under Chapter IV-F of the Act. As apparent from the ground itself, the said direction by the learned CIT(A) follows the decision by the Tri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proper consideration and adjudication in accordance with law after affording reasonable opportunity of hearing to the assessee. We decide accordingly. 8. The assessee's third ground before us relates to the direction by the learned CIT(A) for inclusion of a sum of Rs. 24,024, being the rent for which the house property stands rented to one, M/s Machinery Manufacturing Co. Ltd., which stood not received during the year as the said tenant company was under liquidation. 9. We have heard the parties and perused the material on record. The assessee's case before us, as pleaded by the learned Authorised Representative, was that r. 4 of the IT Rules, 1962, which allows the assessee deduction in respect of unrealized rent [under s. 24(1)(x)], st ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
