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TMI Blog2018 (8) TMI 847X X X X Extracts X X X X X X X X Extracts X X X X ..... cricketer. He is furnishing the return of income of ₹ 61,23,14,400/-. The let out value of the property in dispute is assessed as only ₹ 1,26,000/- by the ld. Commissioner of Income Tax (Appeals) as rent for the whole year. When the same builder has helped the assessee to find tenant for another flat, why his letters to the same builder to help him identify one more tenant, can be considered as fake, defies logic. That the assessee should maintain a dispatch register for his letters as expected by the authorities below, is also abnormal expectation. Hence, we have no hesitation in setting aside the orders of the authorities below and deleting the addition - Decided in favor of assessee. - I.T.A. No. 3755/Mum/2016 - - - Dated:- 10-8-2018 - SHRI SHAMIM YAHYA, AM AND SHRI SANDEEP GOSAIN, JM For The Appellant : Shri Pankaj Jain For The Respondent : Shri V. Vidhyadhar ORDER Per Shamim Yahya, A. M.: This appeal by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-34, Mumbai dated 15.03.2016 and pertains to the assessment year 2012-13. 2. The grounds of appeal read as under: The Commission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owances. The assessee had also argued that the deemed annual value based on the realizable rent in respect of flat at Sapphire Park could be ₹ 1,35,000/- without prejudice to the argument that the annual value is required to be taken as nil. 5. The Assessing Officer rejected the assessee's explanation by commenting that the income offered alternatively by the assessee is too low and estimated the rental income @ 6% of the value of both the fiats aggregating to ₹ 1,43,40,750/- (Rs.82,80,750 + 60,60,000) as deemed rental income. Though the Assessing Officer had discussed regarding the house property income in respect of Sapphire Park on which no rental income was offered, however, while making addition the Assessing Officer has taken value of both the flats at Sapphire Park as well as Treasure Park. Therefore, he held that the decision of the Assessing Officer to charge rental income from the flat at Sapphire Park is a reasonable and correct decision. 6. Before the ld. Commissioner of Income Tax (Appeals), the assessee argued that he had made efforts for letting out of flat at Sapphire Park. The assessee submitted the copies of letters written to builder request ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o identify tenant for another flat in builder s project at Sapphire Park. Subsequently, the assessee has further written letter dated 18.08.2011 and 04.12.2011 being reminders for identifying the tenant to let out flat at Sapphire Park. The ld. Counsel of the assessee further placed reliance upon the following case law: Premsudha Exports (P) Ltd. vs. Asst.CIT [2008] 108 ITD 158 (Mum) 10. Per contra, the ld. Departmental Representative relied upon the orders of the authorities below. 11. Upon careful consideration, we find that it will be apposite to refer to the relevant provision of section 23 in this regard which reads as under: Annual value how determined. 23. (1) For the purposes of section 22, the annual value of any property shall be deemed to be- ( a ) the 57sum for which the property might reasonably be expected to let from year to year; or ( b ) where the property or any part of the property is let57 and the actual rent57 received or receivable57 by the owner in respect thereof is in excess of the sum referred to in clause ( a ), the amount so received or receivable; or ( c ) where the property or any part of the property is let and was vacant during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ut 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 property and the same would fall within the purview of clause (c) of section 23(1). [Para 16] 13. Now we examine the present case on the touch stone of the provision of section 23(1)(c) of the Income Tax Act, 1961 and the case law as afore-said. We find that the assessee has claimed that the said flat had remained vacant throughout the year despite assessee s reasonable effort to let out the same. That the assessee had requested the builder to identify the tenants. In this regard, the assessee has submitted three letters written to the builder. It may be noted that as emana ..... X X X X Extracts X X X X X X X X Extracts X X X X
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