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TMI Blog2024 (1) TMI 840X X X X Extracts X X X X X X X X Extracts X X X X ..... t which he claims has not been paid in the face of accounts reflecting the payment. There has accordingly been no adjudication on the merits of the claim for any of the preceding years; the disallowance of interest since reversed in first appeal, for the two preceding years being on account of a misconception as to non-payment of interest by the assessee, which fact did not obtain. The assessee has before us relied on the relevant parts of the balance-sheet for the earlier years, i.e., the schedule of fixed assets, as well as it s face, reflecting the source and application of funds, to substantiate that the building was financed primarily from secured (from bank) and unsecured (from directors) borrowings. On the basis of the Grounds of Appeal before the first appellate authority, also filed physically (copy on record), it is also shown that the same were also adduced before the AO - we only consider it fit and proper that the matter is restored back, which we do at the request of Ms. Ammal, to the file of the AO, for determination afresh, setting aside the impugned order. Annual value how determined - Computation of annual value (AV) u/s. 23 whether with or without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .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 before the first appellate authority, and for the same reason, on the same being downloaded by the tax consultant. The ld. Sr. DR did not rebut any of the said contentions, even as opting out of the transmission on email (in Form 35) is a matter of record. The provisions of the Information Technology Act, 2000 (sec. 12), clearly state of transmission to be complete on being acknowledged. Under the circumstances, we find sufficient reason/s for condoning the delay. 3. Inasmuch as the impugned order is an ex parte and an in limine dismissal of the assessee s appeal, it was clarified by the Bench that it would be disinclined to adjudicate, and prefer to restore the matter for an adjudication on merits to the file of the ld.CIT(A). While hearing was proceeded with on this basis, Ms. Ammal, the ld. couns ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shown that the same were also adduced before the AO. Under the circumstances, we only consider it fit and proper that the matter is restored back, which we do at the request of Ms. Ammal, to the file of the AO, for determination afresh, setting aside the impugned order. We decide accordingly. 5. The second issue is in respect of computation of annual value (AV) u/s. 23, i.e., whether with or without reckoning the non-receipt of any rent for the seventh (top) floor of the building inasmuch as no rent was received for the same, either during 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 tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd actually , qualifying the word let , absent in sec.23(1), it clarified, would be relevant where a property is let for more than one year, and is vacant for a part of such period, giving a meaning to the word whole occurring in sec. 23(1)(c). Reference in this context be made to paras 10 and 11 of the Judgment. Apart from the fact that the said decision is by a higher Court, which would therefore prevail over the decision by the Tribunal on the strength of judicial precedence, the premise of the decision in Premsudha Exports Pvt. Ltd. (supra) is, with respect, flawed. This is as the words actual rent in s. 23(1)(c) leave no room for any doubt that the condition of letting referred to in s. 23(1)(c) refers to actual letting, which only could result in actual rent , with reference to which the rent in terms of and u/s. 23(1)(a) is to be compared. Why, the words is let and actual rent occur in both clauses, (b) (c), of section 23(1). The same, which are to be accordingly read in the same manner, signify that the provisions contemplate actual letting. The words received or receivable following the same further clarify that what is contemplated is a state of actual lett ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 23(1)(c) 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 said (7th) floor being therefore not let, which it is capable of, the benefit of it s vacancy in computing it s AV does not arise. That apart, the law does not admit the argument being made. The reason is simple. As explained hereinbefore, s. 23(1)(c) is applicable only in case of actual letting of a property or a part of the property. It is thus only where it is let that the benefit of vacancy u/s. 23(1)(c) would be available. Not so ..... X X X X Extracts X X X X X X X X Extracts X X X X
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