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TMI Blog2020 (1) TMI 1202X X X X Extracts X X X X X X X X Extracts X X X X ..... ied/constructed portion. Therefore, we find force in the submission of the learned AR that after issuance of show-cause notice the assessee was not entitled to let out the property. Hence, taxing notional income of unoccupied portion of building on the basis of deemed annual letting value is not justified by the AO. Hence, we direct the AO to delete the disallowance. Considering the fact that we have accepted the contention of learned AR that the assessee was legally not entitled to let out the property. Appeal of the assessee is allowed. - I.T.A. No. 666/Mum/2019 - - - Dated:- 28-1-2020 - Shri R.C. Sharma (AM) And Shri Pawan Singh (JM) Assessee by: Ms. Ritika Agarwal Department by: Shri Michael Jerald ORDER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o APIDC original lessor. Remaining area was to be shared between the assessee and M/s. U.S. Roof Ltd. in the ratio of 40:60. The assessee vide lease agreement dated 6.3.2013 let out 8170 square feet to M/s. Kalyan Jewellers India Pvt. Limited. The Assessing Officer issued show-cause notice as to why remaining unoccupied commercial area should not be considered for deemed annual letting value u/s. 23(1)(a) of the Act in accordance with the decision of Hon'ble Delhi High Court in the case of CIT Vs. Ansal House Finance Leasing Ltd. (354 ITR 180). The assessee vide its reply dated 24.12.2016 stated that against the decision of Hon'ble Delhi High Court SLP has been admitted in the Supreme Court and it is not fair to determine deemed l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of lease. The APIDC filed reply dated 01.12.2014 to the show-cause of cancellation of lease. After considering the reply of APIDC, CIDCO finally cancelled the lease of the plot on the ground that APIDC violated basic object of the allotment vide order dated 31.12.2015. Thus due to legal embargo and notice of cancellation of lease of the plot the assessee was not in a position to let out the balance commercial are in its possession due to impossibility. 7. In the alternative submission learned AR submits that provisions of section 23(1) are applicable on residential unit. The provisions of subsection(2) of section 23 prescribed that (a) where the property consists of a house or part of a house which is in the occupation of the owner for t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent/construction of commercial building namely Proxima at plot No. 19, sector 30A, Vashi. Project was undertaken by the assessee on assignment cum development agreement dated 29.10.2007 with M/s. U.S. Roof Limited. Under the agreement the assessee was entitled to retain an area of 19,840 square feet of developed area. There is no dispute that the assessee let out 8170 square feet to M/s. Kalyan Jewellers India Pvt. Ltd. in the same developed complex. During the assessment the Assessing Officer asked the assessee as to why remaining unoccupied commercial area should not be considered for deeming let out purposes u/s. 23(1)(a) of the Act. On the basis of decision of Hon'ble Delhi High Court in the case of CIT Vs. Ansal Housing Finance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ease. Learned AR of the assessee has strongly relied upon the decision of Hon'ble Jurisdictional High Court in the case of Sharan Hospitality Pvt Ltd. (supra) wherein Hon'ble Court while considering the question of law whether on the facts and circumstances of the case Income Tax Appellate Tribunal was right in law in holding the annual letting value of the property is question for relevant previous year can be determined u/s. 23(1)(a) . Hon'ble Court after considering the contention of the party held that the assessee let out property w.e.f. 1.4.2018 without waiting for occupation certificate, entire property during which the assessee could have let this property, tax on notional basis should be charged. It was further held th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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