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TMI Blog2022 (6) TMI 574X X X X Extracts X X X X X X X X Extracts X X X X ..... There is no dispute between Ld.AO and assessee that the property was vacant and no rent was realized or earned by any means/methods nor any kind of evidence is there. However, the claim of the assessee was that when this property was built at Sultanpur, MG Road, Government of Delhi was having a cealing drive on unauthorized property. This fact was brought to the notice of Ld.AO by filing minutes of meeting between owners of property who represented delegation before Hon'ble Lieutenant Governor of Delhi to intervene in the working of MCD to support the stakeholder, since there was no need for sanction of map in Lai Dora land . Due to this sealing drive tenant were not easily available in the area and there was a genera resistance/fear of taking this kind of property on rent that is why despite of repeated effort in financial year 2012-13, the property in question could not be rented our which was ultimately rented out in next financial year on which taxes were duly paid. However Ld.AO rejected the submission of assessee and added Rs. 1,26,00,000/- after allowing standard deduction and on notional basis. In appeal by the assessee, Ld.CIT(A) also rejected submission of the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come Tax, Central Circle 10, [2008] 110 ITD 158 (Mum.) to contend that the phrases "property is let" as appearing in Section 23(1)(c) of the Act has been appropriately interpreted by the Mumbai Bench while holding that the phrases "property is let" does not mean actual letting of a property and if the property is left out unlet during any part or whole of the previous year due to circumstances beyond the control of owner then the vacancy allowance shall be given for whole of the year and the annual letting value should be considered NIL. 4.1 In this context, he also relied the judgment in Ms. Priyananki Singh Sood Vs. Assistant Commissioner of Income Tax, Circle 52(1), New Delhi 101 taxmann.com 45 (Delhi-Tribunal). He relied the judgment of Mumbai High Court in Empire Capital (P.) Ltd. Vs. Assistant Commissioner of Income Tax, Circle 2(1)(2), Mumbai reported at 114 taxmann.com to submit that in that case a property had remained vacant due to obstruction caused by construction of metro and accordingly the Mumbai Bench of Tribunal held that no addition on account of notional rent could be made. 4.2 It was submitted that Ld. Tax Authorities have fallen in error in relying the judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) Sachin R. Tendulkar Vs. Deputy Commissioner of Income-tax, 23 (3), Mumbai [2018] 96 taxmann.com 253. (ii) DLF Ltd. vs. Assistant Commissioner of Income-tax, Range 10, New Delhi [2019] 106 taxmann.com 294 (Delhi Tribunal) and (iii) Sonu Realtors (P) Ltd. vs. Deputy Commissioner of Income-tax, 14(3)(2), Mumbai [2018] 97 taxmann.com 534 to contend that when there are genuine efforts to let out the property but same cannot be let out then no notional rent can be estimated. 4.4 On the other hand, the Ld. DR submitted that the ld. First Appellate Authority in para no. 4.3, 4.4 and 5.1 has taken into consideration the affidavit of the assessee tendered in additional evidence. It was submitted that the ld. First Appellate Authority had called for remand report from the Ld. AO and based on that the findings are given. It was also submitted that assessee could not controvert the fact that when other relatives in the locality could let out properties how he failed to let out the property. Ld. DR submitted that citations of law relied are factually different. He, thus defended the orders of Ld. Tax Authorites. 5. Appreciating the matter on record and the contentions of the Ld. AR and ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings status qua was directed to be maintained. While with regard to the objections raised by building owners, which included the asseessee's family, Hon'ble Lieutenant Governor observed that Building bye- laws were meant to be followed for all buildings in Delhi, including those within Lal Doras and Village Abadi areas. It was also observed that there can be no compromise on structural and fire safety norms of any building in the Capital. 6.1 However, the ld. Tax Authorities failed to take into consideration, these minutes which substantially indicated that there was a genuine dispute in the locality where the property of assessee was situated with regard to failure of owners of the property to comply with municipal laws concerning structural and fire safety. The Lower Tax Authorities and specially the Ld. AO while submitting the remand report had fallen in error in observing that as the building of assessee was not one of those buildings which were referred in the minutes as partly demolished therefore, he was not to be benefited due to the minutes of the meeting. The bench is of considered opinion that meeting was not just about partially demolished buildings but the issue disc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of dispute was available in the hands of assessee to be let out. However, in the case in hand the property of the assessee cannot be said to be one actually available with him to be let out. The claim of assessee is not merely that in spite of his efforts he could not let out a property which was otherwise rentable. His claim rests on the fact that the property was actually not rentable for the reasons of issues with regard to demolition drive and sealing in the area making it not worthy of being taken on rent for any commercial purpose. 8. This Bench is of considered opinion that the legal disability created by the action of municipal authorities or under course of law, restricting the rights of the property holder to let out the property is a case where provision of Section 23(1)(c) would not be applicable. 9. In this context, the view is confirmed by looking back to Section 23(1)(c) of the Act, which provides that; "(c) where the property or any part of the property is let and was vacant during the whole or any part of the previous year and owing to such vacancy the actual rent received or receivable by the owner in respect thereof is less than the sum referred to in clause ..... X X X X Extracts X X X X X X X X Extracts X X X X
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