Rajratna Holdings P.Ltd, Mumbai vs Department Of Income Tax

आयकर अपीलीय अिधकरण, Ûयायपीठ, मुंबई अिधकरण मुंबई डȣ, Ûयायपीठ, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES 'D' MUMBAI ौी जोिग᭠दर ᳲसह, ᭠याियक सद᭭य एवं ौी राजेÛि, लेखा सदःय के सम¢ BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI RAJENDRA, ACCOUNTANT MEMBER आयकर अपील सं. / ITA No.1742/MUM/2013 िनधा[रण वष[ /Assessment Year: 2007-08 ITO-3(3)(1), M/s Rajratna Holdings Pvt. Room No.672, 6th Floor, Ltd. Vs. Aayakar Bhavan, M.K. Road, 212, T.V. Industrial Estate, Mumbai-400020 52, S.K. Ahire Marg, Worli, Mumbai-400030 (राजःव /Revenue) (ू×यथȸ /Respondent) P.A. NUMBER : AAACR2896G

राजःव कȧ ओर से /Revenue by : Shri Akhilendra Yadav ू×यथȸ कȧ ओर से /Respondent by Shri Anuj Kisnadwala

सुनवाई कȧ तारȣख / 01/01/2015 Date of Hearing : घोषणा कȧ तारȣख / 02/01/2015 Date of Pronouncement :

ORDER

PER JOGINDER SINGH, JM:

The Revenue is aggrieved by the impugned order dated 03/10/2012 of the ld. First Appellate Authority, Mumbai, On the ground whether the ld. First Appellate Authority was justified in holding that the annual value has to be determined 2 M/s Rajratna Holdings Pvt. Ltd.

.

with reference to actual rent receivable by the assessee and not the market value adopted by the Assessing Officer without appreciating the fact section 23(1)(a) of the Act was invoked.

2. At the time of hearing, Shri Akhilendra Yadav, Ld. DR advanced his arguments supporting the assessment order by contending that the Assessing Officer made enquiries from the area/market and found that the rental in the area was very high for much smaller flats with single car parking. It was also contended that ld. Commissioner of Income tax (Appeals) reached to a particular conclusion ignoring the facts recorded in the assessment order.

2.1. On the other hand, Shri Anuj Kisnadwala, ld. counsel for the assessee contended that the issue under hand is covered by the decision of the Tribunal in the case of co-owner of the property order dated 19/12/2014 (ITA NO.9212/Mum/2010 & ITA No.2608/Mum/2013). This factual matrix was not controverted by the Revenue with the help of the any positive material.

2.2. We have considered the rival submissions and perused the material available on record. Before coming to any conclusion, we are reproducing hereunder the relevant portion of the order dated 19/12/2014, ITA No.9212/Mum/2010 for ready reference:-

"3. At the outset, Ld Counsel for the assessee brought our attention to the issue raised in ground no.2 of the appeal and mentioned that the said issue relates to 3 M/s Rajratna Holdings Pvt. Ltd.

.

determination of ALV in respect of the property which is covered by the Rent Control Act. In this regard, Ld Counsel for the assessee filed a letter from the cooperative society where the impugned property is situated. As per the same, the rateable value is Rs. 9,340/-. The said amount is lesser than the actual rent received of Rs.80,000/- per month by four parties and the assessee‟s share comes to Rs. 20,000/-per month. Assessing Officer rejected the same and computed the ALV at Rs.77,17,248/- relying on the figures mentioned in the Stamp Duty Ready Reckoner (para 6 of the impugned order is relevant). Aggrieved with the same, assessee is in appeal before the CIT (A).

4. During the proceedings before the first appellate authority, assessee mentioned that the Assessing Officer is not free to adopt the figures and the same is in violation of provisions of section 23(1)(b) of the Act. CIT (A) considered the various submissions of the assessee and the judicial pronouncements relied upon by him and disapproved the Assessing Officer‟s decision. In this regard, CIT (A) relied on the judgment of the Hon‟ble jurisdictional High Court in the case of CIT vs. Akshay Textile Trading & Agency (P) Ltd reported in 304 ITR 401 (Bom) and held that ALV has to be determined on the basis of the actual rent receivable on 4 M/s Rajratna Holdings Pvt. Ltd.

.

propertyas a rent. Para 6 is relevant in this regard. Aggrieved with the same, Revenue is in appeal with this issue before the Tribunal for the AYs 2007-08 and 2009-2010 under consideration.

5. During the proceedings before us, Ld Counsel for the assessee, to support the views of the CIT (A), filed a copy of another binding judgment of the Hon‟ble jurisdictional High Court in the case of CIT vs. TIP TOP Typography [2014] 368 ITR 330 (Bom) for identical proposition in respect of the property covered under the Rent Control Act. On the other hand, Ld DR relied on the order of the Assessing Officer. After hearing both the parties and on perusal of the orders of the Revenue Authorities as well as the relevant material placed before us, we find, the order of the CIT (A) on this issue given in para 6 of the impugned order is fair and reasonable and it does not call for any interference. Accordingly, ground no.2 raised by the Revenue is dismissed."

2.3. We find that while coming to a particular conclusion, that too in the case of co-owner of the impugned property, the Tribunal, in the aforesaid order relied upon the decision from Hon'ble jurisdictional High Court in the case of CIT vs Tip top typography (2014) 368 ITR 330 (Bom), for identical proposition, in respect of property covered under the Rent Control Act. In the 5 M/s Rajratna Holdings Pvt. Ltd.

.

aforesaid case, the assessee also filed a letter from the cooperative society where the impugned property is situated as per which the rateable value is Rs.9,340/- which is lesser than the actual rent of Rs.18,000/- per month by four parties out of each the share of the assessee comes to Rs.20,000 per month. The ld. Assessing Officer, on the other hand, computed the ALV at Rs.77,17,248/-, relying upon figures mentioned in Stamp Duty Ready Reckoner. Reliance has already been placed by the Tribunal in the case of Akshay Textile trading & Agency (P.) Ltd. 304 ITR 401 (Bom), wherein it was held that ALV has to be determined on the basis of actual rent receivable. In view of these facts, respectfully following the decision from Hon'ble jurisdictional High Court and also of the Coordinate Bench of this Tribunal, we find no infirmity in the conclusion drawn by the ld. Commissioner of Income tax (Appeals), resulting into dismissal of the appeal of the Revenue.

Finally, the appeal of the Revenue is dismissed.

This order was pronounced in the open court in the presence of ld. Representatives from both sides at the conclusion of the hearing on 01/01/2015.

Sd/- Sd/- (RAJENDRA) (JOGINDER SINGH ) ACCOUNTANT MEMBER JUDICIAL MEMBER

MUMBAI, DATED - 02/01/2015 6 M/s Rajratna Holdings Pvt. Ltd.

. f{x~{tÜ? P.S/.िन.स. आदे श कȧ ूितिलǒप अमेǒषत/Copy षत of the Order forwarded to : 1. अपीलाथȸ / The Appellant 2. ू×यथȸ / The Respondent. 3. आयकर आयुƠ(अपील) / The CIT(A)- 4. आयकर आयुƠ / CIT

5. ǒवभागीय ूितिनिध, आयकर अपीलीय अिधकरण, मुंबई / DR, ITAT, Mumbai

6. गाड[ फाईल / Guard file.

आदे शानुसार/ ार BY ORDER, स×याǒपत ूित //True Copy// उप/सहायक उप सहायक पंजीकार (Dy./Asstt. Registrar) आयकर अपीलीय अिधकरण, अिधकरण मुब ं ई / ITAT, Mumbai