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TMI Blog2004 (5) TMI 10X X X X Extracts X X X X X X X X Extracts X X X X ..... ., A. M. KAPADIA. JUDGMENT The judgment of the court was delivered by A.M. Kapadia J.-In these two references at the instance of the Revenue, the Income-tax Appellate Tribunal, Ahmedabad Bench "A", under section 27(1) of the Wealth-tax Act, 1957 ("the Act" for short), has referred the following common questions of law for our opinion for the assessment years 1981-82 and 1982-83: "(1) Whether, the Tribunal is right in law and on facts in allowing 1/6th as repairs irrespective of the fact that the assessee has incurred any expenditure on repairs, though the same is not allowable deduction in the Wealth-tax Act for valuation purposes? (2) Whether, the Tribunal is right in law and on facts in allowing collection charges at Rs. 10,578 as against the Wealth-tax Officer allowing this expenditure to the extent of Rs. 3,600?" Since common questions of law and facts are involved and the controversy raised in both these references is arising out of a claim made by the respondent-assessees who are co-owners of the same property each having 1/3rd share in the property, for the sake of convenience, both these references are heard together and decided and disposed of by this common judgmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charges while determining the valuation of a non-residential property by rental method, the findings arrived at by the Appellate Assistant Commissioner and affirmed by the Tribunal deserve to be quashed and set aside. It is also contended that since there is no provision in the Act to allow 1/6th of the gross rent towards repairs, considering similar provisions in the Income-tax Act for arriving at the income from the house property is misconceived. Besides this, it is also contended that there is no evidence towards repairs and maintenance expenses produced by the assessees and, therefore, if no money has been spent on repairs and maintenance, no allowance could be made towards outgoings. He, therefore, urged that the questions referred to in these two references are required to be answered in the negative, in favour of the Revenue and against the assessee. In support of the aforesaid contention, learned counsel for the Revenue invited our attention to rule 1BB of the Wealth-tax Rules, 1957 ("the Rules" for short), which according to learned counsel does not stipulate the provision for valuation of a house which is let out only or mainly for non-residential purposes such as bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mula for making valuation of a house which is wholly or mainly used for residential purposes- "1BB. (1) For the purposes of sub-section (1) of section 7, the value of a house which is wholly or mainly used for residential purposes shall be the aggregate of the following amounts, namely: (a) the amount arrived at by multiplying the net maintainable rent in respect of the part of the house used for residential purposes by the fraction 100/8; and (b) the amount arrived at by multiplying the net maintainable rent in respect of the remaining part of the house, if any, by the fraction 100/9: Provided that... Explanation: For the purpose of this sub-rule, a house shall be deemed to be mainly used for residential purposes, if the built-up floor area thereof used for residential purposes is not less than sixty-six and two-thirds per cent, of its total built-up floor area.... Explanation: For the purposes of this clause,... (c) 'net maintainable rent', in relation to a house, means the amount of the gross maintainable rent as reduced by-... (ii) a sum equal to one-sixth of the amount by which the gross maintainable rent exceeds the amount referred to in sub-clause (i), in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that immovable business property which is tenanted to tenants is ordinarily subjected to more wear and tear than immovable property used by the owner for his personal use. The contention that the learned Appellate Assistant Commissioner has wrongly considered similar provisions of the Income-tax Act for arriving at the income from the house property has also no substance because when there is no specific provision in the relevant Act or Rules, similar provisions in another Act or Rules and more particularly a tax statute can be invoked for determining the net rent from the house property. As regards the contention that there is no evidence towards repairs and maintenance expenses produced by the assessees, although the Assessing Officer on appreciation of the evidence on record took the view that it was for the tenants to maintain the building and, therefore, the assessees were not entitled to claim any deduction towards repairs, however, on reappreciation of evidence, the Appellate Assistant Commissioner took the view that it was the assessees (lessors) who were repairing and maintaining the building. This finding was arrived at after considering the correspondence between the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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