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| The Tax Publishers2021 TaxPub(DT) 3729 (Mum-Trib) INCOME TAX ACT, 1961
Section 23
Where assessee filed a letter to AO, wherein it was duly informed by the assessee that agreement entered into by him for purchase of a flat at Navi Mumbai, was cancelled; there was no question of assessing any deemed notional rent for the flat, which was not at all in possession of the assessee and hence, the addition made in that regard was liable to be deleted.
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Income from house property - Annual value - Estimation of notional rent - Agreement entered into by assessee for purchase of property in question being cancelled
Assessee entered into an assignment agreement for purchase of a flat at Navi Mumbai. Since owner of the flat was unable to give possession of the said flat, the deal was cancelled. AO did not accept the said contention of the assessee and held that deemed rental income was assessable in the assessee's hands and adopted ALV at 8% of cost of flat. CIT(A) confirmed the said addition alleging that the assessee had not furnished any documentary evidence, which could prove that the agreement entered into by him for purchase of the flat, was cancelled.Held: It was found that assessee filed a letter to AO, wherein it was duly informed by the assessee that agreement entered into by him for purchase of a flat at Navi Mumbai, was cancelled. Thus, there was no question of assessing any deemed notional rent for the flat, which was not at all in possession of the assessee. Hence, the addition made in that regard was accordingly, deleted.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2011-12 & 2015-16
INCOME TAX ACT, 1961
Section 23
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