9911796707
TMI Blog1991 (4) TMI 66X X X X Extracts X X X X X X X X Extracts X X X X ..... der section 256(1) of the Income-tax Act, 1961, pertaining to the assessment year 1974-75 of the assessee, the Tribunal has, at the instance of the assessee, referred the following question for the opinion of this court: "Whether, on the facts and circumstances of the case, the Tribunal rightly held that the vacancy allowance was to be made in an amount of Rs. 2,45,443 even though the rent loss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icipal taxes amounting to Rs. 4,23,338 from the rent receivable of Rs. 14,17,735 and computed the annual value at Rs. 9,94,397. The Incometax Officer accepted the assessee's claim in principle, namely, that the assessee was entitled to deduction on account of vacancy as provided under section 24(1)(ix) of the Act. There was, however, a dispute with regard to the quantum of deduction to be allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal took the view that what was allowable as a deduction under section 24(1)(ix) was restricted to that part of the annual value appropriate to the vacant part and the expression "annual value" was defined by section 23(1) as "rent receivable minus the taxes leviable". In this view of the matter, the Tribunal reversed the Appellate Assistant Commissioner's findings and restored the Income-tax Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "Income from house property". It is section 23 which gives the meaning of the expression "annual value". The scheme of section 23 is that if the property has not been let, then "the annual value" shall be deemed to be the same for which the property might reasonably be expected to be let from year to year. This, of course, is a hypothetical figure which has to be estimated by the Assessing Offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase is covered by clause (b) and, therefore, it is erroneous to contend that what is determined in accordance with section 23(1)(b), read with the proviso thereto, would be the "net" annual value of the property. In our view, the amount thus arrived at would be the "annual value" of the property and it is only a proportionate amount out of this annual value, proportionate to the period of non-occu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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