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TMI Blog2019 (1) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... uce overall tax burden, could not be said to be without any sound basis. We concur with the same. Accordingly, the ground raised by the assessee, in this regard, stand dismissed. The office premise situated at Raheja Centre, Nariman Point was stated to be leased out to a corporate entity in which the assessee was a director. No rental income was reflected by the assessee against the same. It is settled law that corporate entity is a separate legal entity in the eyes of law and the business carried out by the corporate entity could not be said to be the business of shareholders / directors. Therefore, the reasoning that the premise was being used for assessee’s business, hold no water. AR has submitted that the assessee was not provided an opportunity to rebut the estimated rental rates adopted by AO in violation of principle of natural justice. As submitted that the property was covered by State Rent Control Act and the notional rent could not exceed the standard rent fixed under the act in terms of certain judicial pronouncements. Keeping in view the same, while upholding the stand of lower authorities in bringing to tax the notional rental value, the matter of estimation stand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner of Income Tax (Appeals)-28, Mumbai [CIT(A)], Appeal No. CIT(A)-28/IT-135/DC-12(2)/2013-14 dated 22/02/2016. The grounds urged by the assessee reads as under: - 1. On the facts and in the circumstances of the case and in law the Learned Commissioner of Income Tax (Appeals) erred in confirming the addition of income from House Property in respect of Flat No. 72, L Block, in Maker Tower, Cuffe Parade, Mumbai 400006 at ₹ 2,00,000/- per month. 2. On the facts and in the circumstances of the case and in law the Learned Commissioner of Income Tax (Appeals) erred in confirming the addition of income from House Property in respect of office premises at Nariman Point, Mumbai at ₹ 2,00,000/- per month which was being sued by a company in which the appellant is a director. 3. On the facts and in the circumstances of the case and in law the Learned Commissioner of Income Tax (Appeals) erred in confirming the addition of income from House Property in respect of self-occupied flat at Sea Woods Estate Ci-op Housing Society Ltd, At Nerul, Navi Mumbai at ₹ 35,000/- per month. The grounds urged by the revenue reads as under: - 1. On the facts in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation are that the property situated at Flat No.72, L Block, Maker Tower, Cuffe Parade, Mumbai was let out to Bank of America during AY 2007-08 @ ₹ 2 Lacs per month. However, the assessee received interest free security deposit of ₹ 4 Crores from Bank of America and reflected lesser rent of ₹ 0.25 Lacs in AY 2009-10 as well as in impugned AY. The income against the same was assessed at ₹ 2 Lacs per month in AY 2009-10 which was accepted by the assessee by not filing second appeal. Following the same, the income in the impugned AY was estimated on similar lines. On the basis of factual matrix, Ld. AO formed an opinion that the assessee was compensated for loss of rent by way of interest free security deposit from the tenant and it was merely a tax reduction device to give loss to the exchequer. It further transpired that the interest free deposit received by the assessee was advanced to family members without interest and no income was reflected against the security deposit received by the assessee. 2.2 The Second property viz. Gala Nos. 52 53 at industrial unit at A-2 Building, Submill Compound, Lower Parel, Mumbai was stated to be leased to a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot the subject matter of this appeal. The addition against office premises situated at Raheja Centre, Nariman Point was confirmed by observing that the premises was rented out to a corporate entity in which the assessee was director and the said property was not out of purview of Section 22 in terms of judgment of this Tribunal rendered in Indira S.Jain [21 Taxmann.com 471]. However, relying upon the same decision, it was held that addition against shops situated at Hilton Centre, Navi Mumbai were not justified since the shops were leased out to a partnership firm namely Prajax Hospitality and therefore, the same could be said to be used for the purpose of assessee s business. The addition against property listed at serial number-5 was confirmed since the same was not, at all, let out during impugned AY and therefore, not eligible for vacancy allowance in terms of Section 23(1)(c). Aggrieved, the assessee as well as revenue is under appeal before us. 4. The Ld. Authorized Representative for Assessee [AR], Shri H.S.Raheja, on the strength of certain judicial pronouncements agitated the stand of first appellate authority which has been controverted by Ld. Departmental ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding the stand of lower authorities in bringing to tax the notional rental value, the matter of estimation stand remitted back to the file of Ld. AO to consider the valuation proposed by the assessee, who, in turn, is directed to substantiate his stand. The ground stand partly allowed. 5.4 The shops / units situated at Hilton Center, Belapur, Navi Mumbai are stated to be used by the assessee by one of his partnership firm. The first appellate authority concurred with the stand of assessee that use of premise by assessee s partnership firm could be said to be use of premise by the assessee for own business. We concur with the same since a firm is constituted, collectively by its partners and the business of the firm could be said to be the business of its partner. However, upon perusal of quantum assessment order, it transpire that the assessee failed to substantiate the fact that the premise was being used by the firm. Therefore, for limited purpose of verification, the matter stand remitted back to the file of Ld. AO with a direction to the assessee to demonstrate the same. The revenue s appeal stands allowed for statistical purposes. 5.5 Regarding flat at Seawood, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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