| Case ID |
14113abe-24f4-4160-9156-5337ff015476 |
| Body |
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| Case Number |
IT APPEAL NO. 607 OF 2005 |
| Decision Date |
Oct 17, 2007 |
| Hearing Date |
|
| Decision |
The Tribunal upheld the Commissioner's order, affirming that the annual letting value of the property should be based on the rent received by the assessee and not on the rent received by the tenants from their sub-lessees. The court clarified that the annual value must be determined according to the agreement between the assessee and the tenants, regardless of the higher rent that tenants might receive from ultimate users. The ruling emphasized that the law aims to accurately reflect the actual income received by property owners, thus ensuring fairness in taxation. |
| Summary |
The case revolves around the interpretation of Section 23 of the Income-tax Act, 1961, concerning the determination of the annual value of properties for tax purposes. The Bombay High Court addressed whether the annual letting value should be based on the rent received by the owner or the rent received by the tenants from sub-lessees. The court ruled that the annual letting value must reflect the rent received by the property owner as stipulated in the rental agreement, irrespective of any higher amounts paid by ultimate users. This decision is significant for property owners and investors, as it clarifies tax obligations and reinforces the importance of contractual agreements in determining taxable income. The outcome of this case underscores the legal framework governing property taxation in India, influencing future property rental agreements and tax assessments. |
| Court |
Bombay High Court
|
| Entities Involved |
Not available
|
| Judges |
F.I. Rebello,
J.P. Devadhar
|
| Lawyers |
Vimal Gupta,
P.S. Sahadevan,
J.D. Mistry,
Raj Darab
|
| Petitioners |
Commissioner of Income-tax
|
| Respondents |
Akshay Textiles Trading Agencies (P.) Ltd.
|
| Citations |
2008 SLD 2473,
(2008) 304 ITR 401,
(2008) 167 TAXMAN 324
|
| Other Citations |
Apollo Tyres Ltd. v. CIT [2002] 255 ITR 273/122 Taxman 562 (SC),
Jt. CIT v. Kedareshwar Investment & Trading Co. Ltd. [IT Appeal No. 3285 (Mum.) of 1999],
McDowell & Co. Ltd. v. CTO [1985] 154 ITR 148/22 Taxman 11 (SC),
Union of India v. Azadi Bachao Andolan [2003] 263 ITR 706/132 Taxman 373 (SC)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
23
|