1991 (1) TMI 189

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....ered from the statement of facts filed by the assessee along with the Appeal Memo before the first appellate authority. The said facts are reproduced below : " 1. Your appellant has two self-occupied flats. One flat in Bhavani Complex 'A' and the other flat in Bhavani Complex 'B'. Both the flats are not actually let during any part of the previous year and no other benefit therefrom is derived by the appellant. These facts are not under dispute. The income from self-occupied flat in Bhavani Complex 'B' is taken as Nil. This is as per the contemplation under section 23(2)(a)(i) of the Income-tax Act, 1961, and no deduction whatsoever are claimed. Your appellant has exercised the option as given to the appellant under section 23(2)(b) of t....

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.... before the Tribunal. Inviting my attention to sections 23(2)(b), 24(1)(vi) and 24(2) of the Act, the learned Advocate for the assessee vehemently argued that the Income-tax authorities ought to have accepted the assessee's contention that he was entitled to interest deduction of Rs. 55,366 in the first year and Rs. 47,328 in the second year in respect of the Flat at Bhavani Complex 'A' instead of only Rs. 5,000 allowed by them. In this connection, he highlighted the fact that under the said provisions the assessee had an option to select one house for his residence. The restriction regarding deduction of interest to the extent of Rs. 5,000 would be applicable only in the case where the assessee is occupying the house for his own residence.....

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....4 of the Act. He, therefore, urged that I should uphold the action of the IT authorities. 6. I have carefully considered the rival submissions of the parties. In order to better appreciate the rival stand taken by the parties, it is necessary to reproduce below the relevant portion of the provisions of the Act. Section 23 of the Act which contains provisions for determining annual value. Sub-section (2) thereof reads as under :-- " Section 23. Annual value how determined-- (1) (2) where the property consists of-- (a) a house or part of a house in the occupation of the owner for the purposes of his own residence ;-- (i) which is not actually let during any part of the previous year and no other benefit therefrom is derived ....