TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
Use comma for multiple locations.
---------------- For section wise search only -----------------
Accuracy Level ~ 90%
of 
Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
of Press 'Enter' after typing page number.
of Press 'Enter' after typing page number.
All Case Laws
Join Channel
Note
Bookmark
Share
Don't have an account? Register Here
of Press 'Enter' after typing page number.
Issues: (i) whether the writ petition could be entertained despite the availability of an appeal and the stage at which the rent fixation was communicated, (ii) whether retrospective fixation of fair rent was permissible and whether a 15% periodic enhancement could be applied, and (iii) whether the tax deducted at source amount could be treated as arrears recoverable from the petitioner.
Issue (i): whether the writ petition could be entertained despite the availability of an appeal and the stage at which the rent fixation was communicated
Analysis: The petitioner had vacated the premises and handed over possession before the fair-rent orders for the relevant periods were passed, and the impugned demand had been communicated only later. In those circumstances, relegating the parties to the appellate remedy would not resolve the live dispute on arrears. The Court therefore entertained the writ petition to settle the monetary consequences arising out of the tenancy.
Conclusion: The writ petition was held maintainable and was entertained on merits.
Issue (ii): whether retrospective fixation of fair rent was permissible and whether a 15% periodic enhancement could be applied
Analysis: Retrospective fixation of fair rent was held impermissible. At the same time, the Court held that a periodic enhancement of 15% for every three years, as a pragmatic and equitable measure consistent with the prevailing administrative practice, could be applied for determining the rent due in the intervening period. The arrears were therefore worked out by applying 15% enhancement from the date when the next revision became due until the date of vacation.
Conclusion: Retrospective fair-rent fixation was rejected, but a 15% periodic increase was applied for arrears computation.
Issue (iii): whether the tax deducted at source amount could be treated as arrears recoverable from the petitioner
Analysis: The temple had itself been registered for income-tax purposes and had, in some years, sought refund of deducted tax. In that background, the petitioner could not be faulted for having deducted tax at source. The deducted tax amount could not, therefore, be demanded as rent arrears from the petitioner. The appropriate course for the temple was to pursue refund before the income tax authorities in accordance with law.
Conclusion: The TDS amount was held not recoverable as arrears from the petitioner.
Final Conclusion: The dispute was resolved by determining the arrears payable on a prospective basis, excluding the TDS component from recoverable arrears, and closing the matter with directions leaving the parties to work out the tax refund separately in accordance with law.
Ratio Decidendi: Retrospective fixation of fair rent is impermissible, periodic rent enhancement may be applied for arrears computation where justified by the governing scheme, and tax deducted at source cannot be claimed as rent arrears when the payee's tax status and refund remedy lie with the income tax authorities.
TaxTMI 
