TaxTMI 
TaxTMI 
2012 (9) TMI 831
X X X X Extracts X X X X
X X X X Extracts X X X X
....icer has noted that the assessee owns two commercial premises, however, no income from house property was shown in the return of income, and, therefore, required the assessee to explain as to why the income from the said property should not be taken as per market rate. The assessee submitted as under :- "Approximate area and rent of both the properties held by Mrs. Veena are as under : (1) Tex Centre, H wing, Unit No.302/303, 3rd Floor, Saki Vihar Road, Chandivli, Andheri (E), Mumbai-400 072. Area-6000 sq.feet and rent is appx. 15/- per sq. feet. (2) CG/3, Delphi Building, Ground Floor, C wing, Hiranandani Gardens, Powai, Mumbai-400 076. Area-1150 sq. feet and rent is appx. 50/- per sq.feet. We would like to submit that in case of charg....
X X X X Extracts X X X X
X X X X Extracts X X X X
....46 (Bom.); ii) Parkpaper Industries P. Ltd. 25 SOT 406(Mum); iii) Smitaben Ambani 323 ITR 104 (Bom); and iv) JMP Investments Ltd. 15 SOT 180 (Mum) Further, the assessee had furnished annual municipal valuation of the two properties :- i) for the property at tex centre - Rs..1,65,535/- ii) for property at Delphi Building - Rs..7575/- 3.1 Learned CIT(A) too rejected the contention of the assessee that the municipal valuation should be adopted as ALV after referring to decision of Full Bench of the Hon'ble Delhi High Court in the case of Moni Kumar Subba, reported in (2011) 333 ITR 38 (FB)(Delhi) and confirmed the action of the Assessing Officer in adopting the fair market rate of the property at Tex Centre at the rate of 40% per sq.fee....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d on record. It has not been disputed before us that both the properties have not been let out at all and, therefore, annual value has to be determined as per section 23(1)(a). For the sake of the ready reference section 23(1) (a) (b) & (c) are reproduced hereunder :- "23. (1) For the purposes of section 22, the annual value of any property shall be deemed to be- (a) the sum for which the property might reasonably be expected to let from year to year; or (b) where the property or any part of the property is let and the actual rent received or receivable by the owner in respect thereof is in excess of the sum referred to in clause (a), the amount so received or receivable; or (c) where the property or any part of the property is let and ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....value. Obviously, municipal rateable value cannot be equated to standard rent. In this context, it may be desirable to refer to the Calcutta High Court's decision in the case of CIT Vs. Prabhabati Bansali [1983] 141 ITR 419. One of the questions involved in that case was whether the Tribunal was justified in directing the income-tax officer to redetermine the annual value of the property under section 23(1) afresh with reference to its rateable value as determined by the municipal corporation. The question was answered in the affirmative and the court held that the income from house property had to be computed on the basis of the sum for which the property might reasonably be let from year to year and the annual municipal value." ii) Park....
X X X X Extracts X X X X
X X X X Extracts X X X X
....'ble Calcutta High Court in the case of Smt. Prabhabati Bansali (supra) that standard rent, if it does not exceed the Municipal Valuation alone can be adopted in place of Municipal Valuation. For all the above reasons, we hold that the Municipal Valuation should be the basis of determining annual value in the present case. Action of the revenue authorities in adopting annual value on the basis of inquiries conducted regarding market rent in the vicinity of the property is not in accordance with law. The Assessing Officer is directed to accept the income from house property on the basis of Municipal Valuation." iii) Smitaben Amabani, 323 ITR 104(Bom) : In this case, the Hon'ble High Court has held as under :- "In the case of self-occupied ....