TaxTMI 
TaxTMI 
2011 (4) TMI 1363
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....st ground is that the income tax authorities erred in disallowing interest ofRs.30,000/-. A perusal of the assessment order shows that while computing the income under the head "Income from other sources" the assessee claimed interest payable ofRs.30,000/- from the interest ofRs.22,392/- received as interest on FD, savings bank interest and interest from ICICI Safety Bonds. The Assessing Officer called upon the assessee to prove the nexus between the expenditure and the income as required under section 57(iii) of the Act. The assessee admitted that he was unable to prove the nexus. The Assessing Officer therefore disallowed the interest claim ofRs.30,000/- and brought the interest ofRs.22,392/- to assessment. The disallowance was upheld in ....
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....s and after taking note of the statement of facts filed before the CIT(A), which has not been disputed by the CIT(A) or before us on behalf of the department, we are of the view that the consistent practice adopted by the department should not be departed from in the absence of any change in the facts or the legal position. We also find that the judgment of the Karnataka High Court (supra) supports the assessee's claim. We accordingly allow the assessee's claim for deduction ofRs.30,000/- as interest. The ground is allowed. 5. The only other ground is as under: - "2. On the facts and in the circumstances of the case, the CIT(A) erred in upholding the action of the AO in determining and adding Annual Rental Value @ 10% of fair ma....
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.... income the assessee had filed certificates dated 26.08.2005 from the Brihanmumbai Mahanagarpalika showing the rateable value of Kodinar atRs.7,255/- and the rateable value of Capri atRs.3,265/-. It is on the basis of these figures that the annual letting value was offered in the return. The Assessing Officer was however of the view that the Municipal valuation does not reflect the fair market rent of the flats. The assessee would appear to have claimed that he is entitled to the benefit of section 23(1)(c) of the Act, but this claim was rejected by the Assessing Officer. He thereafter proceeded to determine the fair market rent for the properties. He found that the flat at Kodinar admeasured 54.45 sq. mts. It was in Andheri (West). The Ass....
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....ng the whole or any part of the previous year on the lesser of the actual rent received or receivable and the sum for which the property might reasonably be expected to let. Accordingly it was claimed that the assessee rightly offered the rateable value of the flats as determined by the Municipal Corporation of Mumbai. Reliance was placed on the decision of the Mumbai Bench of the Tribunal delivered on 31.05.2007 in the case of Premsudha Exports Pvt. Ltd. vs. ACIT in ITA Nos: 6277 and 6278/ Mum/2006 (assessment year 2003-04). Without prejudice to this claim the assessee also raised contentions on the merits of the reliance placed by the Assessing Officer on the Times of India report for estimating the rental value of the properties. 8....
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....in Mumbai it is the annual rateable value as fixed by the Municipal Corporation Act, which is taken as annual value because the same is based on the cost of construction of the building. It was further held that annual Municipal value if available itself could be the annual letting value and if the actual rent received or receivable is more than the annual Municipal value, then the actual rent may be taken as the annual value. This order of the Tribunal has also been affirmed by the Hon'ble Bombay High Court by order dated 26.09.2007 in Income Tax Appeal No: 752 of 2004. In the case of Bhansali International Pvt. Ltd. vs. ITO, by judgment dated 29.08.2009, in Income Tax Appeal No: 758, 759 and 866 of 2008, the Hon'ble Bombay High Court, whi....