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The Tax Publishers ITO v. Kilachand Devchand & Co. Pvt. Ltd. [ITA No. 4424/M/2011, dt. 7-4-2016] : 2016 TaxPub(DT) 2130 (Mum-Trib) Claim of rent in a disputed lease *Facts:* Assessee took premises on lease from New India Assurance Co. and sublet the same to group companies. The condition of the lease forced the assessee to not to charge more on the sub lease but the same rent as that of the main lease. The lease expired, dispute arose eviction suit was filed against the assessee. In the mean time the assessee stopped paying rent and so stopped collecting rent. Arising out off contingency the rent payable was claimed as an expense which was disallowed for want of TDS and the rent receivable was taxed. On appeal the same stood disallowed both on expense as well as the income which did not accrue. On further appeal: Held in favour of the assesseee that the rent payable need not be taxed as it did not arise also for want of TDS, the rent receivable was also not taxable as it did not accrue. Note: In a similar case concept of holding over under TOP Act 116 was discussed in the recent decision of The Cardboard Material & Printing Co. Private Limited v. ITO/I.T .A. No. 1101/KOL/2015/assessment year 2006-07/ITAT-Kolkata/dtd. 18-3-2016

The Tax Publishers

ITO v. Kilachand Devchand & Co. Pvt. Ltd. [ITA No. 4424/M/2011, dt. 7-4-2016] : 2016 TaxPub(DT) 2130 (Mum-Trib)

Claim of rent in a disputed lease

Facts:

Assessee took premises on lease from New India Assurance Co. and sublet the same to group companies. The condition of the lease forced the assessee to not to charge more on the sub lease but the same rent as that of the main lease. The lease expired, dispute arose eviction suit was filed against the assessee. In the mean time the assessee stopped paying rent and so stopped collecting rent. Arising out off contingency the rent payable was claimed as an expense which was disallowed for want of TDS and the rent receivable was taxed. On appeal the same stood disallowed both on expense as well as the income which did not accrue. On further appeal:

Held in favour of the assesseee that the rent payable need not be taxed as it did not arise also for want of TDS, the rent receivable was also not taxable as it did not accrue.

Note: In a similar case concept of holding over under TOP Act 116 was discussed in the recent decision of The Cardboard Material & Printing Co. Private Limited v. ITO/I.T .A. No. 1101/KOL/2015/assessment year 2006-07/ITAT-Kolkata/dtd. 18-3-2016