9911796707
TMI Blog2024 (1) TMI 840X X X X Extracts X X X X X X X X Extracts X X X X ..... he appeal, filed on 09.01.2023, is delayed by 148 days. It is accompanied by a sworn affidavit of even date by Dr. Thampi Mathew, Executive Director and Principal Officer, also signing the appeal memo before the first appellate authority and the Tribunal, averring that the impugned order, not received physically, and it's transmission on mail, presumably on 15.06.2022 (i.e., the date of the order), was also not noticed inasmuch as he, a senior citizen, did not check his email account. In Form 35, i.e., the appeal memo before the first appellate authority, the company had specifically opted for conveyance of notices and other communications other than by e-mail. The appellant became aware of the impugned order; there being no representation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basis for the disallowance for the two immediately preceding years, on the other hand, was a footnote in the assessee's returns stating of non-claim of interest inasmuch as no interest on the unsecured loans of the Directors had been allowed by the company. The first appellate authority allowed relief for the said years on the basis that the claim could not be denied on that basis where a claim had been in fact preferred; the footnote in the returns being explained to an inadvertent carry-over of the said remark in the returns for the earlier years where no such claim was, for that reason, i.e., non-payment, made. The non-claim and, consequently, non-allowance for the earlier years, would therefore be of no consequence; the disallowance by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ring the current year or even the preceding years, and which informs the AO's order relying on the decision in Vivek Jain v. Asst. CIT [2011] 337 ITR 74 (AP). The basis for the acceptance of the assessee's claim in first appeal for the earlier years is the non-applicability of the said decision, stated to be inapplicable to commercial properties, as against the decision by the Tribunal in Premsudha Exports Pvt. Ltd. v. Asst. CIT [2008] 110 ITD 158 (Mum), relied upon by the assessee, and accepted as applicable for commercial properties. 6. We have heard the parties, and perused the material on record. 6.1 The controversy before us is the true interpretation of sec. 23(1)(c). We find no basis whatsoever for the said distinguishing by the ld ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in sec.23(1)(c) implies an intention to let, coupled with the demonstration of efforts to let it - which would only clarify the said intent. The basis for the same is the use of words, in contradistinction, "actually let" in sec. 23(3), signifying, by the Legislature, the condition of the property being actually let. As such, as long as there is an intent to let the property, demonstrated by efforts to let it, the reduction in the annual value u/s. 23(1)(a), on the basis of it being vacant, would arise u/s. 23(1)(c). The said contention, also advanced in Vivek Jain (supra), did not find favour with the Hon'ble High Court, relying for the purpose on the cannons of interpretation of statutes (paras 12, 13). The apparent contradiction between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a), besides making s.23(1) as internally inconsistent, renders sec. 23(1)(a) otiose. Where a property is not actually let, it's annual value (AV) would always be nil u/s. 23(1)(c). Where, then, is the question of AV being computed on the basis of rent expected to be fetched? Sec. 23(1), as indeed sec.23 itself, is to be read as a whole. Clause (a) defines the AV as the expected lettable value, and at which income is to be normatively taxed. Clauses (b) and (c) provide for a revision, upward or downward, therein, based on actual letting, depending on a higher or lower rent being received/receivable; the latter being on account of vacancy. Explanation to sec. 23(1), providing that the actual rent received or receivable would not include, subj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the absence of actual letting. The seventh floor of the building is admittedly separately lettable. For the purpose of letting, only on the basis of which annual value of a house property is to be reckoned, it is thus a separate property, independent of others, as indeed is each of the other floors, even as confirmed during hearing, even though more than one floor may be occupied by a single tenant. It cannot be regarded as part of a property, as in that case the entire property would be let or, as the case may be, not let. As for example where there is a common entrance, or the different floors are functionally linked, as where they together represent a residential house or an office spread across different floors of a building. The sa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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