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TMI Blog2017 (5) TMI 1357X X X X Extracts X X X X X X X X Extracts X X X X ..... ual letting value of the let out property of Dada Manzil. 4. The ld. CIT(A) has grossly erred in confirming the disallowance of bank charges of Rs. 100/- from the annual letting value of the let out property of Dada Manzil. 5. The Ld. CIT(A) has erred in not considering the ground of the assessee in respect of interest income which has been wrongly taken as Rs. 7,89,198/- instead of Rs. 2,71,591/-. 3. We begin with ground number 1 to 4 of the appeal as they address a common issue. Briefly stated the facts are that the assessee filed his return of income for the AY 2009-10 on 19.08.2009 declaring total income of Rs. 64,11,000/-. The assessee has shown income from house property and other sources. The Assessing Officer (AO) on perusal of the computation of income found that the assessee has claimed the following expenditures as allowable deductions in respect of the income from the respective house properties - A. 35 Maker Chamber VI Brokerage paid Rs. 5,00,565/- B Gitanjali Society outgoings Rs. 1,25,070/- C 37Maker Chamber VI Society outgoings Rs. 44,086/- D Dada Manzil Electricity expense Rs. 27,228/- Legal & Prof. Rs. 1,25,000/- &nbs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rned counsel of the assessee filed a paper book on 24.03.2017 placing reliance on the order of the Tribunal in Sir Sobha Singh & Sons (P) Ltd. vs. IAC [1996] 55 TTJ 699 (Del); M/s. Suman Didwania vs. ACIT (ITA No. 5805/Mum/2010) - ITAT 'H' Bench-Mumbai; ACIT vs. Mohanlal Rupesh Kumar (2001) 114 taxman 81 (Gauhati) (Mag.); ACIT vs. Sunil Kumar Agarwal (2012) 20 taxmann.com 330 (Lucknow); Varma Family Trust vs. 6th ITO (1984) 7 ITD 392 (Bom) and Realty Finance & Leasing (P) Ltd. vs. ITO (2006) 5 SOT 348 (Mum). 6. The learned DR submits that the Act clearly mentions that while calculating the income from house property, only certain allowable deductions are to be allowed u/s 23 and 24 of the Act. What specific deductions are to be allowed in computing the income under the head income from house property have been categorically and unequivocally specified in the Act. Hence, no deduction of expenses other than what is specified in the Act can be allowed in computing the income from house property. She supports the order of the learned CIT(A). 7. We have heard the rival submissions and perused the relevant material on record. The income from a let out house property is determined as un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue was determination of annual value of income from house property u/s 23 of the Act. The assessment years were 1997-98 to 1998-99. As per rent agreement, in respect of certain premises, the assessee was to receive rent excluding water charges and had to bear all taxes, cesses and outgoings and lessee had to bear any further increase thereon. Further the assessee had to provide reserve parking space against monthly wages. The AO, while computing income of assessee from house property, disallowed expenses on account of car parking, water charges and municipal and other charges paid by lessee and made addition. The Tribunal held that in view of section 23(1)(b), if outgoings were liabilities of assessee, same should be excluded from assessable income as net amount only could be considered which was received and was receivable by the assessee. The matter was remanded to the AO to determine whether outgoings claimed were assessee's liability against rental income. In Sharmila Tagore (supra), the Tribunal held that maintenance charges paid to housing society have to be deducted even while arriving at annual letting value of property u/s 23. Also it held that non-occupancy charges levie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Suman Didwania (supra), for the A.Y. 2006-07 the assessee had declared income from house property and claimed deduction of the maintenance charges from the rent received of Rs. 19,25,000/- which was claimed to have been paid by the assessee to the said society. The assessee stated that society charges are for NOC charges and maintenance charges over and above 'municipal taxes' and hence same are deductable. The Tribunal followed the decision in the case of Sharmila Tagore vs. JCIT 93 TTJ 483 and allowed the appeal of the assessee. In Mohanlal Rupesh Kumar (supra), the assessee's claim for deduction of depreciation and electrical charges from income from house property for the A.Y. 1989-90 was disallowed by the AO on the ground that there was no provision for allowing the same. On appeal, the CIT (A) directed the AO to allow the claim as allowed in the past. On further appeal, the Tribunal held that in view of legal position and facts of instant case, gross rental income was required to be split into components of rent for building and rent for furniture, fixtures and additional facilities provided to tenant and while former would be assessable as income from house property from wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and did not permit of any deductions other than those listed in sections 23 and 24. The Tribunal held that 'in computing annual value under rental method, outgoings like stamp charges and legal fees paid by owner for drawing up lease deed are deductible from actual rent fixed.' In Realty Finance & Leasing (P) Ltd. (supra), for the assessment year 1999-2000, the AO disallowed the society charges on the ground that the said expenses were not allowable u/s 24 out of the rent received by the assessee. On appeal, Commissioner (Appeals) upheld the AO's view. The Tribunal held that "it was an admitted fact that the gross rent receipt also included the society charges which were to be paid by the assessee. Therefore, while computing the annual value the amount of rent which actually went into the hands of the owner in respect of leased property should be taken into consideration. As per the provisions of section 23, the annual value of property is to be determined on the basis of actual rent received by the owner." 7.2 It is a settled law that the doctrine of res judicata or estoppel by record does not apply to AO's decisions. A finding or decision of the income tax authorities in one ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the rent. Therefore, the case of the assessee is distinguishable from R.J. Wood (P) Ltd. (supra) relied on by the learned counsel of the assessee. 7.4 We have discussed at para 7.1 here-in-above, the orders of the Tribunal relied on by the learned counsel of the assessee. It would now be apposite to refer to the judgement of the Hon'ble Delhi High Court in CIT vs H.G. Gupta & Sons (1984) 17 taxmann 287 (Del). The assessee-firm owned some property which was given on lease to a company. The lease deed provided that the stamp duty and registration charges in respect of the lease were to be borne by the lessee and the assessee equally. The claim of the assessee for deduction of Rs. 5,977 i.e. its half share of stamp duty etc. was disallowed by the ITO. The AAC upheld the ITO's order. On further appeal, the Tribunal, however, allowed the asssessee's claim. On appeal by the revenue, the Hon'ble High Court held that the impugned expenditure was not allowable as a deduction in assessing annual value of the property. Their Lordships held as under: "5. The annual value of the property, which is the subject of charge, was originally defined in section 23(1) as 'the sum for which th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 years. 7. We, therefore, answer the reference in the negative, i.e., in favour of the department and against the assessee. As the assessee has not put in appearance, we leave the parties to bear their own costs." 7.5 The obtaining factual matrix has to be tested on the anvil of the aforesaid pronunciation of law. Respectfully following the judgement of the Hon'ble Delhi High Court in the case of H.G. Gupta and Sons (supra), we dismiss ground no 1 to 4 of the assessee. 8. Now we turn to ground no 5 of the appeal. It relates to the grievance of the assessee that interest income has been wrongly taken as Rs. 7,89,198/- instead of Rs. 2,71,591/-. It is the contention of the learned counsel that there was a clerical error in taking interest income as Rs. 7,89,198/- in the profit & loss account of the assessee; however the actual interest income is only Rs. 2,71,591/- and this can be verified from the TDS certificate. 8.1 We have heard the rival submissions and perused the relevant material on record. The actual interest income received by the assessee can be verified from the TDS certificates. Therefore, the order of the learned CIT(A) relating to this ground of appeal is se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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