TaxTMI 
TaxTMI 
2011 (4) TMI 1277
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....ociety charges amounting to Rs. 1,26,000/- during A.Y. 2005-06 and Rs. 1,32,000/- for A.Y. 2006-07 are the main grievance of the assessee in the above two appeals. 3. First, we shall take up the appeal for the A.Y. 2005-06. The facts of the case in brief are that the assessee is a non-resident individual and declared income from house property at Rs. 2,00,424/-. From the computation of total income filed by the assessee, the A.O. noted that the assessee deducted an amount of Rs. 1,26,000/- being society charges from the rent received for calculation of annual value which according to the A.O. is not allowable u/s 23 of the Act. He, therefore, asked the assessee to show cause as to why the same should not be disallowed. The assessee in her ....
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....rovided the net rent far exceeds the annual ratable value the society charges is duly allowable as a deduction." 4. However, the A.O. was not satisfied with the explanation given by the assessee. He discussed the provisions of section 22, 23 & 24 and noted that only municipal taxes can be deducted from the rent received for arriving at the annual value of the property. From this value only deductions as per section 24 are allowable at a sum of 30% of the annual value and the amount of interest payable if the property is acquired with borrowed capital in view of the amended provisions of section 24 by the Finance Act, 2001 w.e.f. 1.4.2002. Various decisions cited by the assessee are not applicable to the facts of the present case. He also r....
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....t was submitted that annual value is to be determined after reducing the society charges paid by the assessee. 4. However, the ld. CIT(A) was not convinced with the explanation given by the assessee and upheld the action of the A.O. While doing so, he relied on the decision of Hon'ble Mumbai High Court in the case of CIT v. J.K. Investors (Bombay) Ltd. 248 ITR 723 (Bom) and the decision of the Tribunal in the case of ITO vs. Barodawala Properties Ltd. (2002) 83 ITD 467 (Mum) dated 26th December, 2001. He, accordingly, upheld the action of the A.O. Aggrieved by the order of the ld. CIT(A), the assessee is in appeal before us. 5. The ld. counsel for the assessee referred to the following decisions and submitted that while computing annual v....
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....sp; 12. Shri Trilochan Singh Sahney v. ACIT (ITA No. 5304/M/08 dt. 30.11.09 13. J.B. Patel v. DCIT [2009] 312 ITR(AT) 171 (Ahd) 14. M/s Sahara Developers v. CIT (ITA No. 1039/M/04 dated 6.5 08. 5.1 Referring to Clause 7 of the Leave and Licence Agreement with Development Credit bank Ltd. (Page 13 of the paper book ), he submitted that as per the said agreement Licensor shall be exclusively liable for the payment of all present and future outgoings with respect to the said licensed premises including but not limited to the society outgoings, municipal taxes, cesses, rate assessments, duties, levies etc. He submitted that the decisions relied on by the ld. CIT(A) are....
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.... of the Tribunal in the case of Gopichand P. Godhwani (supra), after considering the decision of the Hon'ble Bombay High Court in the case of J.K. Investors (Bombay) Ltd. (2001) 168 CTR (Bom) 189 has held that for the purpose of determining annual value of the property all taxes, cesses and outgoings being liabilities of the assessee, have to be excluded from assessable income in view of s. 23(1)(b). So far as the decision of the Tribunal in the case of Barodawala Properties Ltd. (supra) is concerned, we find that the Tribunal in subsequent judgments have held that while calculating annual value of the let out property, maintenance charges paid to the society by the assessee is admissible deduction from the annual let out value u/s 23(1)(b)....