Law: Income Tax Act, 1961

Section: 23

Income-tax-----Property---Determination of annual value---Property let out---Valuation under Municipal Corporation Act not challenged---Annual value to be determined on basis of annual rateable value---Indian Income Tax Act, 1961, S.23. An entire building was let out to various persons, including some directors of the assessee-company and relatives of the directors and persons having substantial interest in the company. The Assessing Officer estimated the gross rental income from the building at Rs.2,73,120 in each of the assessment years, 1985-86 and 1986-87. The Tribunal held that the annual ` letting value should be taken according to municipal law. On a reference: Held, that when the valuation of the property had been determined under the Calcutta Municipal Corporation Act and that had not been challenged, the Tribunal was justified in accepting the annual letting wine on the basis of valuation taken by the Calcutta Municipal Corporation under the provisions of the Municipal Corporation Act. The Tribunal was justified in law in adopting the annual rateable value according to the municipal law for the purpose of assessment under the Income-tax Act. CIT v. Prabhabati Bansali (1983) 141 ITR 419 (Cal.); CIT v. gatya Co. Ltd. (1994) 75 Taxman 193 (Cal.); Dewan Daulat Rai Kapoor v, New Delhi Municipal Committee (1980) 122 ITR 700 (SC) and Mrs. Sheila Kaushish v. CIT (1981) 131 ITR 435 (SC) ref. JUDGMENT By, this reference application, the Tribunal has referred the following questions set out at page 2 of the statement of case for our opinion: "(1) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in adopting the annual rateable value according to the municipal law for the purpose of assessment under the Income-tax Act? (2) Whether, on the facts and in the circumstances of the case the Tribunal was justified in law in not holding that the standard rent under section 8(1) (d) of the West Bengal Premises Tenancy Act, 1956, should be the basis for determining the annual letting value of the property at 33, Madan Mohan Tolla Street, Calcutta, under section 23(1) of the Income Tax Act, 1961? (3) Whether there was any material…

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