TaxTMI 
TaxTMI 
2011 (4) TMI 1337
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.... Officer to the income of the assessee from house property on account of notional interest on interest free deposit. 3. The assessee in the present case is an individual, who filed his return of income for the year under consideration on 1.12.2003 declaring total income of Rs. 14,97,265/-. He is the co-owner of property which was given on rent to Bank of Bahrain and Kuwait. The said tenant had given interest free security deposit. The interest attributable to the said deposit worked out by applying the rate of 12% at Rs. 1,50,184/- was added by the Assessing Officer on notional basis while determining the ALV of the property and after allowing deduction @ 30% in respect of repairs under section 24, a net addition of Rs. 1,05,128/- was ma....
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....a different view in favour of the revenue has not been taken into consideration by the Division Bench of the Tribunal while deciding the case of Reclamation Realty involving similar issue in the assessment year 2004-05. It is observed that a similar contention was sought to be raised on behalf of the revenue in the case of Reclamation Realty India Pvt. Ltd., on the similar issue for the assessment year 2004-05, but the same has been rejected by the Coordinate Bench of this Tribunal and the issue has been decided in favour of the assessee vide its order dated 28.01.2011 passed in ITA No. 3066/Mum/2008 for the following reasons given in para Nos. 5 to 8 of the said order: "5. Rival contentions heard. On a careful consideration ....
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....s determined by the municipal corporation. On a reference : Held, that the Tribunal was justified in holding that the aggregate amount receivable from the tenants in occupation under regular tenancy agreements and partly from licensees in occupation under the leave and licence system could not be taken as the annual value of the property. The Tribunal was justified in directing the ITO to determine the annual value of the property afresh with reference to its ratable value as determined by the municipal corporation." This judgment was followed by the jurisdictional High Court in the case of M.V. Sonawala 177 ITR 246 (Bom.) where at para 5 it is held as follows : "5. In this context, it may be desirable to refer to the Calc....
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....sion of the Hon'ble Bombay High Court in the case of J.K. Investors (Bombay) Ltd. (supra) which is confirmed by the Hon'ble Supreme Court. It is nobodies case that Rent Control Regulation applies. 8. In view of the above discussion, we see no reason to deviate from the decision of the coordinate bench on the very same issue in assessee's own case. We respectfully follow the same and dismiss this appeal of the Revenue." 5. Respectfully following the orders of the Tribunal passed in the case of Reclamation Realty India Pvt. Ltd., for the assessment years 2004-05 and 2006- 07(supra) on similar issue, we uphold the impugned order of the learned CIT(A) deleting the addition made by the Assessing Officer to the total income of the ass....
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.... and Seasonal apparels had to compete its exports commitments for the year 31.3.2003 and thus had to export goods even at very low margin." 8. The above explanation offered by the assessee was not found satisfactory by the Assessing Officer to fully explain the drastic fall in G.P.rate. After allowing certain liverage to some of the adverse factors explained by the assessee, the Assessing Officer determined the income of the assessee by applying the G.P. rate of 6% which resulted in the trading addition of Rs. 8,55,614/-. 9. On appeal, the learned CIT(A) deleted the said addition after having satisfied that the fall in G.P. rate in the year under consideration was satisfactorily explained by the Assessing Officer. He also noticed that....