Company-owned residence exemption and comparable rent valuation upheld where directors occupied the bungalow and valuation evidence went unchallenged.

A company-owned bungalow used by its directors as a residence was treated as falling within the statutory exemption for buildings held solely for occupation by the company's officers or servants, so it was not governed by the U.P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972. The annual letting value fixed at Rs. 6,000 was upheld because it was based on comparable rental evidence from nearby properties, and the assessee did not challenge the correctness of the comparables relied on. The note concludes that both issues were decided against the assessee and in favour of the Revenue.

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Issues: (i) Whether a company-owned building occupied by its directors as residence was exempt from the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972; (ii) whether the annual letting value of the building at Rs. 6,000 was /fairly determined.

Issue (i): Whether a company-owned building occupied by its directors as residence was exempt from the U. P. Urban Buildings (Regulation of Letting, Rent and Eviction) Act, 1972.

Analysis: The exemption for a building built and held by a company solely intended for its own occupation, or for the occupation of its officers or servants, covered the building in question. The bungalow was admittedly placed at the disposal of the company's directors for residence, and on those facts it could not be treated as governed by the Rent Control Act.

Conclusion: The issue was answered in favour of the Revenue and against the assessee.

Issue (ii): Whether the annual letting value of the building at Rs. 6,000 was fairly determined.

Analysis: The annual letting value was a finding of fact based on comparison with the rental value of adjacent properties. The assessee did not dispute the correctness of the rental value of the comparable property relied on by the Income-tax Officer, and no reason existed to disturb the valuation.

Conclusion: The issue was answered in favour of the Revenue and against the assessee.

Final Conclusion: Both referred questions were answered against the assessee, upholding the Revenue's stand on exemption and valuation.

Ratio Decidendi: A company-owned building used by its directors as residence can fall within the statutory exemption for company-held buildings intended for occupation by the company's officers, and a valuation based on comparable rental evidence will not be interfered with when supported by unchallenged facts.

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