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TMI Blog2022 (4) TMI 641X X X X Extracts X X X X X X X X Extracts X X X X ..... by the assessee before allowing the claim of the assessee. - Decided in favour of assessee. - ITA No. 823/Mum/2021 - - - Dated:- 14-2-2022 - SHRI S RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI PAVAN KUMAR GADALE, JUDICIAL MEMBER For the Appellant : Ms.Ritu KamalKishore.AR For the Respondent : Mr.Dilipkumar Shah.Sr.DR ORDER PER PAVAN KUMAR GADALE JM: The assessee has filed the appeal against the order of CIT(A) -50, Mumbai passed u/s 143(3) and 250 of the Income Tax Act. The assessee has raised the following grounds of appeal. 1. On the facts and in the circumstances of the appellant's case and in law the Ld. CIT(A) erred in confirming the AO's action of not allowing the society maintenance charges of ₹ 68,18,580/- paid to the housing society in respect of let out premises owned by the appellant while computing the annual letting value (ALV). 2. Without prejudice, on the facts and in the circumstances of the appellant's case and in law the Ld. CIT(A) erred in confirming the AO's action of adding the society maintenance charges to total income of appellant as per return of income instead of adding the same to 'Income from Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered the grounds of appeal, submissions of the assessee and findings of the A.O, finally is of the opinion that the action of the A.O is tenable and confirmed the addition and dismissed the assessee appeal. Aggrieved by the CIT(A) order, the assessee has filed an appeal before the Honble Tribunal. 5. At the time of hearing, the Ld. AR submitted that the CIT(A) has erred in confirming the addition irrespective of the fact the in the assessee s sister concern cases the claim was allowed. The assessee has filed explanations and judicial decisions with the assessing authority and the CIT(A) which were not considered. The Ld.AR supported her submissions with the provisions of law, judicial decisions and the paper book. Contra, the Ld. DR relied on the order of the CIT(A). 6. We heard the rival submissions and perused the material available on record. The sole crux of the disputed issue envisaged by the Ld. AR that the CIT(A) has erred in confirming the addition made by the A.O. in respect of society maintenance charges. The contentions of the Ld. AR are that the claim has to be allowed in addition to the deduction u/s 24 of the Act as these are society maintenance charges, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... housing society to members (landlord) whose properties are let-out. Therefore, while determining the annual letting value (ALV) of the property, the sum for which the property might be reasonably expected to be let from year to year, the nonoccupancy charges paid to the society has to be taken into account. When it is taken into account, the annual letting value (ALV) would be considerably reduced. Because payment of non-occupancy charges is inextricably linked with the letting out of the property even though there is no provision in sec.24 of I.T Act 1961 for deduction of nonoccupancy charges to arrive the ALV. While calculating the ALV non occupancy charge cannot be ignored because payment of non-occupancy charge arises only when the property is let out. In view of the above, the society maintenance charges and non-occupancy charges levied by the society has to be allowed u/s. 24 r.w.s 23 of 1.1 Act 1961. The appellant humbly submits that as per the decision of Delhi Bench of the Tribunal in the cases of Neelam Cable Mfg. Co. V. Asstt. CIT (1997) 59 TTJ (Del) 474 (1997) 63 1TD 1 (Del), Lekraj Channa v. ITO (1990) 37 TTJ (Del) 297 and the decision of the Bombay Bench of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome Tax (A). ITA No.827/Del/2012 This fact was not controverter by the Ld. Departmental Representative. Under the circumstance, in the facts and circumstances of the case, we do not find any illegality or infirmity in the order of the Ld. Commissioner of Income Tax (A). Accordingly, we uphold the same. In the result, the appeal filed by the revenue stands dismissed. 7. We find the Hon ble Tribunal in the case of Ms Sharmila Tagore Vs. JCIT 2006 150 taxmann.com 4, (Mumbai) has held as under; In view of the Tribunals order in the case of Bombay Oil Industries Ltd. v. Dy. CIT [2002] 82 1 (Mum.), the maintenance charges had to be deducted even while determining the annual value of the property under section 23. Though there is no provision in section 24 for deduction of the non-occupancy charges, the non- occupancy charges will have a depressing effect upon the annual letting value of the property. Once the annual letting value of the property is estimated which is the sum for which the property might reasonably be expected to be let from year to year, there is no way to ignore the non-occupancy charges because the question of payment of non-occupancy charges arises o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obligation of the lessee and the same is duly included in the rent received by the assessee. In our considered view, this issue is squarely covered by the decisions of the Tribunal in the cases of Sharmila Tagore (supra) and Bombay Oil Industries (supra). Respectfully following the decisions of the Tribunal in the cases cited (supra), we hold that assessee is entitled for deduction of ₹ 1,17,825/- u/s 23 of the Act apart from the standard deduction u/s 24(a) of the Act. We direct the AO to verify the claim of deduction of the assessee of the said society maintenance charges of ₹ 1,17,825/- paid by the assessee but stated to be obligation of the lessee and stated to be duly included in the gross rent received by the assessee before allowing the claim of the assessee. We Order accordingly. 15. In the result, the appeal filed by the assessee in ITA N0. 1810/Mum/12 for the assessment year 2006-07 is partly allowed. 10. We find the submissions of the Ld.AR are realistic and are supported by the facts and judicial decisions which cannot be over looked and the claim of deduction of society maintenance charges has to be allowed. We respectfully follow the judicial precede ..... X X X X Extracts X X X X X X X X Extracts X X X X
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