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TMI Blog2024 (2) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... of 3000 sft of the area lying vacant on 1 st and 2 nd floors are required to be determined by applying the rate of Rs. 38/- per sft. Remaining area of 12000 sft situated at 3 rd and 4 th floors of the property - As seen Municipal Rental Value (MRV) as claimed by the assessee was in the range of Rs. 5/- per sft whereas assessee has let out the portion to the Girls hostel @ Rs. 10/- per sft and the AO has claimed ALV @ Rs. 38/- per sft. Properties situated on 3rd and 4th floors of the property will definitely fetch less rent when compared with ground and 1st floors of the property because 3rd and 4th floors are not connected with lift and the occupants have to climb three stairs to reach the point and even the 3rd and 4th floors of the property are not in use for so many years and are lying vacant for many years and therefore, the ALV taken by the AO and confirmed by the CIT(A) are, in our view, was on the higher side and are required to be estimated. Since the property of the assessee is situated in a remote area of Anantapuram, it cannot be possible for the Assessing Officer to find out comparable premises which is situated at 3rd and 4th floors - we have to estimate th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the assessment year 2017-18. 2. The grounds raised by assessee reads as under : 1. That the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi ( Ld.CIT(A) ) is not justified in not giving an opportunity to the appellant to file rejoinder to the remand report submitted by the Assessing Officer. Without prejudice to the above ground 2. That the Ld.CIT(A) is not justified in confirming the addition of Rs. 68,70,717/- made by the Assessing Officer towards annual value of the vacant portions of the house property and consequently erred in confirming the addition of Rs. 48,09,502/- made under the head 'Income from house property'. 3. That the Ld.CIT(A) erred in not appreciating that the addition of Rs. 48,09,502/- made by the Assessing Officer was without considering the deduction towards vacancy allowance and ignoring the provisions of clause (c) of sub-section (1) of Section 23 of the Act. 4. Without prejudice to the above, that the Ld.CIT(A) erred in not appreciating that the sum of Rs. 68,70,717/- taken by the Assessing Officer towards vacant portions cannot be regarded as the reasonable expected rent as per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the ALV not declared by the assessee was Rs. 68,70,717/- which was now brought to tax. Hence, the income from the House Property of Rs. 66.36,2161/- was taken into account and brought to tax by the Assessing Officer. 5.2. The assessee during the said A.Y 2017-18 declared income from own business of Rs. 53,191/-. During the course of assessment proceedings for the A.Y. 2012-13, in the letter dt NIL received in this office on 05.12.2019, the assessee submitted that she had purchased Plant Machinery for Rs. 17,25,000/- which was given on hire for a monthly rent. The allowable depreciation @ 15% on the same was claimed as business expenditure but was wrongly stated in the return of income under property instead of business head . When the assessee was asked to furnish the relevant bill for the purchase of the said Plant Machinery, the assessee in her another letter dt. NIL submitted in this office on 12.12.2019, stated that during the year Hot mix plant at factory building erected at Krishnareddy palls, Chiyyedu and the same was given on hire to Nitin Sai Constructions where the assessee was a partner and the same has been considered as income and admitted in the returns. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded an amount of Rs. 32,00,000/- as unexplained cash credits under Section 68 of the Act. Thus, he completed the assessment u/s 143(3) of the Act and passed order on 25.12.2019 determining the total income at Rs. 1,51,52,019/-. 6. Feeling aggrieved with the order of Assessing Officer, assessee filed an appeal, which was subsequently, migrated to the ld.CIT(A), NFAC, Delhi, who partly allowed the appeal of the assessee. 7. Feeling aggrieved with the order of ld.CIT(A), assessee is now in appeal before us. 8. GROUNDS 2 TO 5 In this regard, ld. AR had drawn our attention to Para 3.1 of the assessment order which is to the following effect : 3.1 During the course of assessment for the A.Y. 2016-17, it was verified that the assessee had constructed a building by name Nithin Sai Complex. The total lettable area is 24,000 sq. ft. As per the details submitted, the assessee had not let out the full lettable area. The assessee in the computation has declared rent received for a total of 9,000 sq. ft. let out and admitted in her letter dt. NIL, received in this office on 12.12.2019. that an area of 15,000 sq. ft. is still vacant. As per provisions of section 23, the ALV of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... udgments in support of her contention. Alternatively, the assessee contended that Municipal Rentable Value (MRV) should be adopted to determine the Annual Value of the property with regard to claim that the property was vacant. The assessee filed affidavit from one Mr. Jaya Remota, Real Estate Broker and in support of MRV, assessee filed certificate from Registered Income Tax Valuer. The information available and the documents filed by the assessee are considered. With due respect to the judicial pronouncements relied by the assessee, the judgement of Delhi Court in the case of Commissioner of Income Tax Vs M/s Ansal Housing Finance Ltd appears to be relevant to the facts of the case. In the instant case, the Hon'ble High Court held that Income Tax on property is levied not on actual receipt basis but on the basis of ALV. ALV is a method to arrive at a figure on the basis of which the impost is to be effectuated. The Assessing Officer has rightly invoked the provisions of sec. 23(1)(a) in arriving at ALV and the contention of the assessee that the ALV of the property has to be taken as NIL as it was vacant is not tenable. With regard to assessee contention that Municipal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the paper book). Further, ld. AR placed reliance on the decision of Hon ble Bombay High Court in the case of CIT-12 Vs. Tip Top Typography reported in (2014) 48 taxamnn.com 191. 8.4. Ld. DR on the other hand submitted that inspite of applying Rs. 38 per sft, additional discount of 10% could be given i.e., only assuming the value of the property. He had also relied on the decision of the jurisdictional High Court, and he had also submitted that the decision referred to by the ld.CIT(A) i.e., Commissioner of Income Tax Vs M/s Ansal Housing Finance Ltd is required to be applied with all force in the present case. Ld. DR further relied on the decision of Hon ble High Court of Andhra Pradesh Vs. ACIT reported in (2011) 14 taxmann.com 146. 9. We have heard the rival submissions and perused the material on record. Admittedly, the assessee is the owner of Nithin Complex, which is a commercial property, consisting of the ground and four floors, having the total vacant area of 24000 sft and out of the said 24000 sft, 9000 sft was let out by the assessee and the remaining area of 15,000 sft was lying vacant during the year under consideration. Out of the said 15000 sft, 12000 sft was o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tched by the assessee from the ground and 1st floor. 9.3. Having observed the above, it came to our notice that the ld.CIT(A) in Para 6.1.9 had noted that the assessee was asked to furnish the rejoinder to the comments of the Assessing Officer. However, the assessee has not given any reply to the rejoinder and only submitted that the appeal for A.Y. 2012-13 is pending for adjudication, raising the identical issue before the Tribunal and fixed for hearing on 25.07.2023. On perusal of page 28 of the paper book, we found that the Tribunal vide order dt.17.08.2023 had dismissed the appeal of the assessee. Against the dismissal of the appeal, the assessee has preferred the MA at page 42 of the paper book and it is stated that the same is pending for adjudication before the Tribunal. In our view, once the appeal of the assessee for A.Y. 2012-13 has been dismissed by the Tribunal for the reasons mentioned therein, we do not find any reason to give relief to the assessee on the grounds raised before us. In case, the Tribunal while hearing the M.A. filed by the assessee, recalls the order dt.17.08.2023, then the assessee may file the application to recall the present order on this issue. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eeds to be upheld. Further, it appears that the assessee by not submitting documents during the course of assessment proceedings came with an afterthought by submitting documents as per her convenience. 10.1. It was submitted by the ld. AR before us that the assessee has discharged her onus as required under law by producing her cash book for the period from 01.04.2016 to 31.03.2017 as well as the extract of cash book of M/s. Nithin Sai Constructions for 20.04.2016 (placed at pages 12 to 15 of the paper book) before the Assessing Officer as well as the ld.CIT(A). It was further submitted that the Assessing Officer has verified that the assessee has withdrawn the amounts from the bank account of M/s.Nithin Sai Constructions and had deposited the said amount on the same dates in her bank account. Once the assessee has proved that the cash withdrawn by her was deposited in her bank account on the same day, then it can be said that the assessee has discharged her onus by proving the identity, creditworthiness and source of cash deposits and therefore, no addition can be made in the hands of the assessee. 10.2. Per contra, the ld. DR has submitted that withdrawal of the amount ..... X X X X Extracts X X X X X X X X Extracts X X X X
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