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TMI Blog2020 (7) TMI 498X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 - we direct the AO to delete the disallowance. Considering the fact that we have accepted the contention of assessee was legally not entitled to let out the property. As noted that the issue is already been adjudicated by Tribunal in earlier year, wherein it is held that once, there is show cause notice issued to the assessee for cancellation of lease and finally the lease was cancelled vide order dated 31.12.2015 and the same was served to assessee on 01.01.2016. This being impossibility of renting out the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 of the Act. 3. Brief facts are that the assessee constructed a commercial building name Proxima at Vashi, Navi Mumbai under a development agreement dated 29.10.2007 with US Roof Limited and developed total area of 6500 Sq. ft. This property was originally given to Andhra Pradesh Industrial Development Corporation in short (APIDC) and the remaining area was shared between the assessee and US Roof Ltd. in the ratio of 60:40. The total area developed was 39,567 sq. ft. out of which 6500 sq. ft. was given to original lessor, APIDC. Out of the balance area of 33,061 sq. ft., the assessee was entitled to 60%, which worked to 19,840 sq. ft. The assessee has leased out these area to M/s Kalyan Jewellers and Red Consulting i.e. 8,596 sq. ft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Leasing Co. Ltd. (supra). The assessee in its reply dated 24.12.2016 has stated that the SLP had been admitted by Hon'ble Apex Court against the decision of Hon'ble Delhi High Court. The Assessing Officer not accepted the contention of the assessee and worked out deemed letting out value of unoccupied area and worked out the gross rental income and after allowing 30% dedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y 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 that between 1.1.2009 up to 31.3.2009 property was legally not occupyable and not occupied. Under such circumstances charging of tax on notional rental basis and the question of interpretation of section 23(1)(a) did not arise at all. 13. In the case in hand a show-cause notice for cancellation of lease was issued on 25.8.2013 and ultimately lease of plot was cancelled v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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