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TMI Blog2014 (6) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... in the said properties ALV on the basis of Municipal ratable value- the AO should assess ALV on the basis of Municipal ratable Value – Decided in favour of Assessee. - ITA No. 719/Ahd/2013 - - - Dated:- 16-5-2014 - Shri Mukul Kr. Shrawat And Shri T. R. Meena,JJ. For the Appellant : Shri Mitesh Modi, A.R. For the Respondent : Shri J. P. Jhangid, Sr. D. R. ORDER Per : Shri T.R.Meena, Accountant Member This is an appeal at the behest of assessee which has emanated from the order of CIT(A), Valsad, dated 31.10.2012 for assessment year 2007-08. The effective grounds of appeal are as under: (1) On the facts and in the circumstances of the case and in law, the learned CIT (Appeals) erred in confirming the order o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Ruparel Cross Marg B , Mumbai Out of above three flats, the assessee has chosen to show notional income of flat nos. 3 4 of Rekha Apartment. Since the assessee had chosen residential property in Paras Apartment as self occupied, a question for determining annual value arises before the A.O. for those other than self occupied properties as per the provisions of Section 23(4) of the IT Act. As per Section 23(4) where the property of any assessee consist more than one house (a) the provisions of that sub-section shall apply only in respect of one of such houses, which the assessee may, at her option, specified this (b) the annual value of the house or houses, other than house in respect of which the assessee has exercised an option und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also volume of business was in crore. The notional rent on the basis of total purchase price of property nos. 1 2 has been worked out at Rs.95,000/- @10% on total price of Rs.9.5 lacs. 2(i). The A.O. had worked out the annual rental value of property no.1 at Rs.12,00,000/- and property no.2 at Rs. 4,00,000/- and same was added in the income of the assessee. He allowed 30% deduction on it. 3. Being aggrieved by the order of the A.O., the assessee carried the matter before the ld. CIT(A) who had allowed the appeal partly by observing that since the annual rental value had not been taxed in the cases of other coowners as assessee has 50% share in both the properties. The entire rental value is assessed to this case on the protective ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emises and reasonable return on such cost. He relied upon the decision Hon ble Supreme Court in case of Dewan Daulatrai Kapoor vs. New Delhi Municipal Committee another 122 ITR 700 (SC), in which, it is held that the AO would have to arrive at the standard rent by applying the principles laid down in the rent Control Act for determination of the standard rent. In view of the above background, the value of deemed let out properties is considered as per the ALV determined on the basis of standard rent. Therefore, he considered the market value of both the properties as assigned by the A.O. in assessment order. He further observed that in case of flat no.3, Rekha Apartment, the appellant got50% of share as gift from the mother-in-law in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore, 50% on rent is taken as income in the hands of appellant. 4. Now, the assessee is before us. Ld. A.R. argued that appellant had opted flat no.18, Paras Co-operative Housing Society Ltd. as self occupied property for residential purposes for which he filed necessary evidence at page no.66 of paper book. The other two flats being flat no.3 and adjacent small unit no.4 at Rekha Co-op. Housing Soc. Ltd. had been treated by the appellant as the property deemed to be let out and accordingly, based upon the Municipal Ratable Value of Rs.6,000/- has been shown in the return of income. It is further argued that this ALV of Rs.6,000/- of flat nos. 3 4 has been consistently shown year to year in the return of income by all the coowners, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted by the ld. Counsel that the standard rent be applied considering Maharashtra Rent Control Act, which provided for the standard @ 10% of the cost of residential property. The ld. Counsel submitted the Valuation Report before the lower authorities to decide the standard rate on the basis of standard rent as per Maharashtra Rent Control Act. He further relied in case of ITAT, Mumbai Bench decision in case of Deputy Commissioner, Special Range-22 vs. Shripal S. Morakhia [2006] 7 SOT 609 (MUM.), wherein ALV was taken as actual rent Rs.7,000/- per month more than Municipal Ratable Value against the ALV decided by the A.O. at Rs.13,65,475/-. Thus, he requested to apply Municipal Ratable Value for self occupied property to determine the inc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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