Tribunal Rules in Favor of Appellant Based on Property Rental History

The Tribunal allowed the appeal, ruling in favor of the appellant. It emphasized the property's past rental history, vacancy reasons, and accepted rental income in subsequent years. The decision aligned with section 23(1)(c) provisions, warranting no addition of notional rent. The Tribunal's ruling was based on factual and legal analysis, ensuring fair treatment of the appellant in the assessment of rental income on the vacant property.

---

---

Issues:
- Addition of notional rent on vacant property

Analysis:
The appellant, engaged in trading, owned a property in Chennai. The Assessing Officer added notional rent of Rs. 11,37,878 as the property was vacant during the assessment year. The CIT(A) upheld the addition, leading the appellant to appeal before the Tribunal. The appellant argued that the property was vacated due to ongoing Metro Project work, hindering tenant search. The appellant eventually found a tenant in 2015-16. The appellant contended efforts were made to find a tenant, citing section 23(1)(c) of the Act. The Department argued against the appellant's contentions, emphasizing lack of evidence on tenant search efforts.

The Tribunal noted the property was previously let out, but vacant during the relevant year. Referring to section 23(1)(c) of the Act, the Tribunal found no actual rent received due to vacancy, justifying no addition of rental income. The Tribunal rejected the Department's argument on lack of evidence, as the appellant had rented out the property in 2015-16, with the rental income accepted by the Assessing Officer. Citing a similar case, the Tribunal accepted the rental income as 'nil,' setting aside the addition of notional rent.

In conclusion, the Tribunal allowed the appeal, emphasizing the property's past rental history, vacancy reasons, and accepted rental income in subsequent years. The decision aligned with section 23(1)(c) provisions, warranting no addition of notional rent. The Tribunal's ruling was based on factual and legal analysis, ensuring fair treatment of the appellant in the assessment of rental income on the vacant property.

---