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TMI Blog2011 (12) TMI 228X X X X Extracts X X X X X X X X Extracts X X X X ..... requires to be deleted. 3. Without prejudice to the right to seek waiver with the Hon'ble CCIT/DG, the appellant denies herself liable to be charged to interest under section 234B and 234C of the Act, which under the facts and in the circumstances of the appellant's case and the levy deserves to be cancelled. 4. For the above and other grounds that may be urged at the time of hearing of the appeal, your appellant humbly prays that the appeal may be allowed and justice rendered and the appellant may be awarded costs in prosecuting the appeal and also order for the refund of the institution fees as part of the costs." 2. Ground No.1 & 4 are general in nature while the grievance vide ground No.2 relates to the addition of Rs. 6,95,565. 3. The facts of the case in brief are that the assessee being a Non-Resident Indian filed the digital return of income on 30.10.2007 for the year under consideration declaring taxable income of Rs. 51,54,846. The said return of income was processed under section 143(1) of the Income Tax Act, 1961 (herein after referred to as 'the Act') on 13.2.2008. Later on, the case was selected for scrutiny. The Assessing Officer noticed that the assessee had sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y was acquired during the previous year and was vacant during the year. Subsequently, during the assessment year 2008-09 it is let out to Zehra and Sabiha Kazi and the rental income of Rs. 2,94,500 has been offered for tax. In terms of section 23(1)(c) of the Act, the annual letting value of the property has to be adopted as NIL." The Assessing Officer after considering the submission of the assessee observed that the assessee had not shown any proof regarding the efforts made to let out the above said properties. So, it was quite inconvincible that there can be any hardship faced in letting out and that those properties located in prime localities like Bandra in Mumbai and Andheri East, Mumbai that those properties had fetched good rentals in subsequent years. The Assessing Officer adopted notional value of 70% on the rent received for the Assessment Year 2008-09 and after allowing 30% for repairs made the addition of Rs. 6,95,555 for the Assessment Year under consideration in respect of the two properties. Accordingly, the same was added to the income of the assessee. 4. Being aggrieved the assessee carried the matter in appeal to the learned CIT(A) and submitted that the prope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcumstances, was deleted by following the decision of the ITAT, Mumbai Bench 'C' in the case of Premsudha Exports (P) Ltd. Vs. ACIT (2008) 110 ITD 158 (Mum) and the relevant findings have been given in para 11 and 11.1 of the order dated 29.4.2011 which are reproduced as under : "11. After" considering the submissions of both the parties and the material on record, it is noticed that the property in question remained vacant and claim of the assessee was that she made all the efforts to let out the property, but the same could not be let out because the property was situated at 5th floor and the lift was not working. On a similar issue, the I.T.A.T. Mumbai Bench 'C' in the case of Premsudha Exports (P) Ltd. Vs. ACIT, CC 10, Mumbai (supra), has held as under: "It was the case of the revenue that clause (c) of section 23 (1) can only be invoked in those cases where the property was let out in earlier years or in the present year. The assessee, on the other hand, contended that the intention of letting out the property was to be seen for invoking clause (c) of section 23 (1) for computing the annual letting value of the property and it was irrelevant whether the property is/w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hout any intention to let it out in the relevant year. Not only that, even if the property was let out at any point of time even by any previous owner, it could be claimed that the property is let out property because the clause talks about the property and not about the present owner and since the property was let out in past, it is a let out property, although the present owner never intended to let out the same. Therefore, it is not at all relevant as to whether the property was let out in past or not. These words do not talk of actual let out also but talk about the intention to let out. If the property is held, by the owner for letting out and efforts are made to let it out, that property is covered by clause (c) and this requirement has to be satisfied in each year that the property was being held to let out but remained vacant for whole or part of the year. Above discussion shows that meaning and interpretation of the words 'property is let' cannot be 'property actually let out'. Thus, if a property is held with an intention to let out in the relevant year coupled with efforts made for letting it out, it could be said that such a property is a let out propert ..... X X X X Extracts X X X X X X X X Extracts X X X X
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