TaxTMI 
TaxTMI 
1994 (12) TMI 327
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....ta and not the Standard rent determined under the West Bengal Premises Tenancy Act, 1956 ? 2. Whether, on the facts and in the circumstances of the case and in view of the fact that the assessee in his returns of income for the assessment years 1980-81 and 1981-82 had shown the annual letting value of the premises No. 7/1, Queens Park, Calcutta at ₹ 9,000 for each of the above years, the Tribunal was justified in law in fixing the annual letting value of the above premises for the above assessment years at ₹ 6,750 which is even below the value admitted by the assessee in returns of the income ?" 2. The facts as found by the Tribunal are as under : During the previous years ending 31-3-1980 and 31-3-1981, corresponding to....
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....ting value for the purposes of section 22 read with section 23 based on the standard rent determinable under the Rent Control Law or under the Municipal Act. The assessee filed copies of the Corporation bills before the Tribunal to show the annual municipal value determined by the Corporation of Calcutta. The department opposed the assessee's submissions and contended that the annual letting value under section 23(1) was to be fixed with reference to the market rent. The Tribunal considered the rival submissions and held that it was a settled law that the annual letting value under section 22 read with section 23 had to be determined with reference to the standard rent under the Rent Control Law applicable to the property in question. T....
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....reference to the actual rent received/receivable by the owner, if the same is in excess of the sum for which the property might reasonably be expected to let from year to year. In the said case, this court after considering the provisions of section 23 as well as the relevant provisions of Bombay Municipal Act held as under : "Therefore, in a case where the actual rent received is higher than that for which the property might reasonably be expected to let from year to year in respect of an income accruing subsequent to the amendment different considerations might arise. But we are not concerned with such a situation in the instant case. Therefore, in view of that position and the municipal law and in view of the decision of the Suprem....
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....ari material with section 168 of the Calcutta Municipal Act, 1951, as well as section 154 of the Bombay Municipal Corporation Act, 1988. These matters were duly considered by this Court in Prabhabati Bansali [1983] 141 ITR 419. The Tribunal was not right in saying that there will be a double deduction for repairs in case the municipal valuation was adopted. The Tribunal failed to appreciate that the rateable value fixed by the Municipality has to be increased by 1/9th so as to determine the annual value being the gross annual rent at which the property is reasonably expected to let from year to year. The view that the annual value cannot exceed the municipal valuation is supported by the decision in CIT v. R. Dalmia [1987] 163 ITR 517 (De....
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....aced on Dr. Balbir Singh's case (supra) which was also relied upon by the Tribunal. In our view the said decision supports the case of the assessee rather than that of the revenue. There, the Supreme Court reiterated the principles that in respect of self-occupied property the rateable value of the house property cannot exceed the standard rent. It may, in a given case, be less than the standard rent. 7. The ratio of the several decisions of the Supreme Court as well as this Court is that there is unity of the Municipal Act and the Income-tax Act on the question of annual value and that such annual value cannot exceed the standard or fair rent under the Rent Control Act and may in a given case even be lower than the standard or fair re....
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.... such there is no rent received or receivable by him. In our view the municipal valuation of ₹ 6,750 should of course be increased by 1/9th thereof to arrive at the gross annual rent at which the property may reasonably be let from year to year. The gross annual rent, therefore, comes to ₹ 7,500. The Tribunal is, therefore, directed to compute the income of the assessee in respect of the said property taking the gross annual rent at ₹ 9,000. In this view of the matter we answer the first question in this reference in the affirmative and in favour of the assessee. 8. The controversy raised in the second question is as to whether the annual letting value of the property determined by the Tribunal could be a figure lower tha....