INCOME TAX ACT, 1961

Section 23(1)(a)

Income from house property - Anunal value - National rent - Property remained vacant

Assessee-company was engaged in business of manufacture of material handling equipments and generation of power. It filed return of income for assessment year 2013-14. AO found that the assessee leased out its property in earlier years and lease got expired, and the assessee received 23 days rent pro rata for financial year 2004-05 and after that the property remained vacant and no rent was received. Therefore, the AO was of the opinion that the notional rent had to be taxed under provisions of sections 22 and 23. Accordingly, the AO applied the provisions of section 23(1) and calculated notional income from house property and accordingly, determined income from house property. On appeal, CIT(A) confirmed action of the AO. Assessee contended that the CIT(A) erred in confirming addition under provisions of section 23(1)(a) as rental income exceeded standard rent and municipal rateable value of that area. Held: In view of decision of Coordinate Bench of Tribunal in assessee's own case on similar issue for earlier assessment year, the matter relating to taxability of notional rent under provisions of section 23(1)(a), was remanded to AO for de novo consideration.

REFERRED :

FAVOUR : Matter remanded.

A.Y. : 2013-14

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