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TMI Blog2018 (10) TMI 1685X X X X Extracts X X X X X X X X Extracts X X X X ..... 12 passed by the Commissioner of Income Tax (Appeals) - 20, Mumbai [hereinafter referred to as the CIT(A) ] relevant to the A.Y.2013-14. 2. The assessee has raised the following grounds: - [A] Grounds of Appeal; 1. In the facts and circumstances of the case and in law, the learned A.O, erred in adding ₹ 63,95,231. under the head Income from House Property and the Commissioner of Income Tax(A) erred in confirming addition of ₹ 12.60.000/- (₹ 18,00,000 - ₹ 5,40,000) by overlooking the submissions made by the Appellant and various ease laws quoted therein. 2. In the fuels and circumstances of the ease and in law. the learned CIT(A) erred in adding additional income of ₹ 12,00,000/- (subject 10 deduction of 30%) on account of security deposit even though this addition was never made by the Assessing Officer and therefore amounts to enhancement without notice to the Appellant and also overlooking the judgment of CIT v/s MONI KLMAR SUBBA reported in (2011) 333 ITR 38 (Delhi)(FB). 3. In the facts and circumstances of the case and in law, the learned A.O, erred in initialing penalty u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has filed the present appeal before us. 4. We have heard the argument and advanced by the Ld. Representative of the parties and perused the record. The Ld. Representative of the assessee has argued that the matter of controversy has been adjudicated by the Hon ble ITAT in the assessee s own case for the A.Y. 2012-13 in ITA. No. 5354/M/2017, therefore, in the said circumstances, the claim of the assessee in connection with the considering the rental value assessed by municipal authorities for computing the deemed rent u/s 23(1) (a) of the Act is liable to be considered in accordance with law. However, on the other hand, the Ld. Representative of the Department has refuted the said contention. Before going further, we deemed it necessary to advert the finding of the Hon ble ITAT in the assessee s own case for the A.Y. 2012-13 in ITA. No. 5354/M/2017 on record. The relevant finding has been given in para no. 5 6 which are reproduced below: - 5. I have heard the rival contentions and gone through the facts and circumstances of the case. The learned Counsel for the assessee Shri Bhupendra Shah argued on behalf of the assessee and on the other hand, the learned S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... real position. He must not make a guess work or act on conjectures and surmises. There must be definite and positive material to indicate that the parties have suppressed the prevailing rate. Then, the enquiries that the Assessing Officer can make, would be for ascertaining the going rate. He can make a comparative study and make a analysis. In that regard, transactions of identical or similar nature can be ascertained by obtaining the requisite details. However, there also the Assessing Officer must safeguard against adopting the rate stated therein straightway. He must find out as to whether the property which has been let out or given on leave and license basis is of a similar nature, namely, commercial or residential. He should also satisfy himself as to whether the rate obtained by him from the deals and transactions and documents in relation thereto can be applied or whether a departure therefrom can be made, for example, because of the area, the measurement, the location, the use to which the property has been put, the access thereto and the special advantages or benefits. It is possible that in a high rise building because of special advantages and benefits an office or a b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion, answered the issue and summed up the conclusion as well. Then, it is but natural and logical that in the event, the transaction is influenced by any extraneous circumstances or vitiated by fraud, or the like that the Assessing Officer can adopt a fair rent based on the opinion obtained from reliable sources. There as well, we do not see as to how we can uphold the submissions of Mr. Chhotaray that the notional rent on the security deposit can be taken into account and consideration for the determination. If the transaction itself does not reflect any of the afore stated aspects, then, merely because a security deposit which is refundable and interest free has been obtained, the Assessing Officer should not presume that this sum or the interest derived therefrom at Bank rate is the income of the assessee till the determination or conclusion of the transaction. The Assessing Officer ought to be aware of several aspects and matters involved in such transactions. It is not necessary that if the license is for three years that it will operative and continuing till the end. There are terms and conditions on which the leave and license agreement is executed by parties. These terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sit and the properties being covered by the Maharashtra Rent Control Act but no standard rent thereunder is fixed, our attention has not been invited to any other case. Suffice it to hold that in those cases and to which our attention is not invited the principles laid down in the decisions of the Hon'ble Supreme Court and referred to by the Full Bench of the Delhi High Court would govern the enquiry. 5. On appraisal of the above said finding, it is quite clear that the matter of controversy has duly been adjudicated by the Hon ble ITAT in the assessee s own case for the A.Y. 2012-13 in ITA. No. 5354/M/2017. The said matter of controversy has been adjudicated on the basis of the decision of Bombay High Court in the case of CIT Vs. Tip Top Typography (2014) 368 ITR 330 (Bombay). The relevant finding has been discussed above while reproducing the finding of the Hon ble ITAT in the assessee s own case (supra). It is specifically held that only value fixed by the municipal authority can be a rational yardstick for computing deemed rent u/s 23(1)(a) of the Act. Since, the matter of controversy has been fully covered by decision of the Hon ble ITAT in the assessee s own ca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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