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TMI Blog1994 (3) TMI 131X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the property on rent capitalisation method. The Valuation Officer adopted the total rent receipt for the rented portion at Rs. 1,54,584 and estimated the rent for vacant portion at the rate of Rs. 2.50 per sq.ft. which worked out to Rs. 38,700 for the year. The gross annual rental income was therefore taken at Rs. 1,93,284. The Valuation Officer allowed therefrom water pump operation, watchmans salary Rs. 5,400 and ground rent for leasehold land Rs. 7,500. He capitalised the net rental income at 9% and also allowed 5% therefrom for co-ownership. The fair market value of whole property was thus assessed at Rs. 19,00,400 and 50% share of the assessee was taken at Rs. 9,50,200 and the same was adopted by the Assessing Officer for assessment. 3. On appeal, the Dy. CIT(A) allowed relief on the following counts: (1) 8% deduction was allowed for co-ownership against 5% allowed by the Valuation Officer. (2) 1/6th of the rent was directed to be allowed for repairs and maintenance, etc. (3) Rental income for the vacant portion was adopted at the rate of Rs. 1.75 per sq.ft. as against the rate adopted by the Valuation Officer at Rs. 2.50 per sq.ft. (4) 12% rate of interest w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso makes landlord responsible for keeping rented premises adequately repaired. Further the AAC Baroda had allowed 1/6th for repairs and maintenance for asst. yrs. 1972-73 to 1977-78 and the same was not challenged before the Tribunal in second appeal. He has also pointed out that Punjab Haryana High Court has allowed deduction at 1/6th for repairs and maintenance in the case of Dina Nath vs. CED (1970) 77 ITR 193 (P H). The learned counsel for the assessee has, therefore, pleaded that on given facts the learned Dy. CIT(A) was fully justified in allowing 1/6th for repairs and maintenance. 8. We have considered the facts and submissions made. Considering the past history and decision of Punjab Haryana High Court in the case cited supra, we entirely agree with the findings given by the Dy. CIT(A) on the issue and the same is upheld. 9. The third issue involved is assessment of rental value of vacant portion. The vacant portion admeasuring 1290 sq.fts. is involved and the Departmental Valuation Officer has assessed its fair market value at Rs. 2.50 per sq. ft. 10. The Valuation Officer has submitted that the rent of self-occupied portion had to be assessed based on the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at 12% was considered reasonable for capitalisation of income. The learned Dy. CWT(A) relying upon the aforecited decision of the ITAT Ahmedabad Bench, has directed the Assessing Officer to adopt the rate of interest at 12% for capitalisation. Since the issue involved stands covered by the earlier decision of the Tribunal, we uphold the order of the learned Dy. CWT(A) in the issue. Bhaktinagar Plot: 13.1 The next objection raised is about the valuation of Bhaktinagar plot of land admeasuring 16,966 sq. ft. in the Bhaktinagar Society in co-ownership with others. Out of this, 11,050 sq. ft. was acquired by Baroda Municipal Corporation in 1978, but the assessee was yet to receive compensation for the same. It was claimed that the land was covered under the Urban Land Ceiling Act and it is not freely transferable. It was, therefore, claimed that it should be valued at the rate not exceeding Rs. 5 per sq. mt. as per the provisions of Urban Land Ceiling Act. 13.2 The assessee got the land valued from registered valuer. The registered valuer valued it for Rs. 33,150 at the rate of Rs. 6 per sq. ft. On a reference made the Departmental Valuation Officer valued 50% share in the la ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry report nor he has given the base on which the market rate for asst. yr. 1977-78 were given at Rs. 8 to Rs. 10 per sq. ft. The learned Departmental Representative has, therefore, submitted the learned Dy. CWT(A) has adopted the market rate at Rs. 15 per sq. ft. without giving adequate basis therefor whereas the valuation report of the D.V.O. is based on comparable sale instances. 13.5 The learned counsel for the assessee, on the other hand, maintained that the land is covered by Urban Land Ceiling Act and the assessee cannot hope to get compensation at the rate exceeding Rs. 5 per sq. mt. There is no open market for the plots covered by the Urban Land Ceiling Act. He also submitted that the land has been taken by the municipal corporation for widening the road, and no compensation has been paid so far. It is not yet known when and how much the amount will actually be received in composition. It was, therefore, claimed that only the defe 13.6 The Departmental Valuation Officer, on the other hand, has pointed out that the bigger HUF filed a return with the competent authority for the land, but no order has yet been passed about the excess land, if any, under the Urban Land Cei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the learned Departmental Representative that the bigger HUF has filed return with the Competent Authority under the Urban Land Ceiling Act, but no decision so far has been taken thereon. Unless the land is declared surplus and duly notified under the Urban Land Ceiling Act, the owner continues to hold the land. There may be certain constraints on transfer of the land, but that does not mean that its market value is only at the rate at which compensation is admissible under the Urban Land Ceiling Act. The first appellate authority was, therefore, not justified in directing to value the land in question at the rate of Rs. 5 per sq. mt. equal to the rate of compensation admissible under the Urban Land Ceiling Act. 17. The learned counsel for the assessee, on the other hand, made submissions in support of the order of the first appellate authority. 18. We have considered the facts and the rival submissions. Admittedly, the assessee HUF has 50% share in the said land being member of a bigger HUF. The assessee has not filed any return under the Urban Land Ceiling Act rather the bigger HUF has filed such a return. It is also on admitted fact that the Competent Authority has no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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