Itxa/515/2012 Of The Commissioner Of Income Tax -1 v. Shri Sudhir Behl

sas IN THE HIGH COURT OF JUDICATURE AT BOMBAY The Commissioner of Income Tax-1, Mumbai ..Appellant. Shri Sudhir Behl..Respondent. Mr. Suresh Kumar for the appellant in all the appeals. Mr.M.Subramaniam with Mr. Vishnu Hadade for the respondent in all the appeals. CORAM : S.C.DHARMADHIKARI AND A.K. MENON, JJ. DATED : 22ND AUGUST, 2014 P.C. :- 1.All these appeals are filed by the revenue. They are directed against an order of the Income Tax Appellate Tribunal. The Income Tax Appellate Tribunal has held that the ratio of the Full Bench decision of the Delhi High Court in the case of Commissioner of Income Tax V/s. Moni Kumar Subba and which is reported in (2011) 333 ITR 38 (Delhi) does not permit the revenue to reject the amount determined as rent or licence fees by the assessee on mere doubt or suspicion. There has to be cogent and satisfactory material to indicate that the rent or fees determined by the parties are not indicative of the fair or market rent. The Annual Letting Value has to be determined and decided only in such cases where there is established fraud, collusion or an attempt is made by the parties to inflate or deflate the rent because of the relationship or such other consideration, otherwise the determination of the rent or fees between the lessor and the lessee cannot be said to be influenced by any exigencies aforesaid for the Income Tax Authorities to determine and decide the Annual Letting Value. In all these cases, the parties have fairly brought to our notice a judgment of this Court in Commissioner of Income Tax-12, Mumbai V/s. Tip Top Typography [Income Tax Appeal No.1213 of 2011 and connected appeals] decided on 8[th] August, 2014. One of us (S.C.Dharmadhikari, J.) is a party to this judgment. We have followed the ratio of the Full Bench of the Delhi High Court in the above case and respectfully concurred with it. In such circumstances and when the revenue was unable to produce any material so as to challenge the determination made by the parties, the approach of the Commissioner of Income Tax and the Tribunal and to determine the annual letting value on the basis of valuation of Municipal Corporation cannot be termed as perverse or vitiated by any error of law apparent on the face of it. In fact in some of the appeals, the Tribunal has determined the letting value at a rate more than the municipal valuation. In such circumstances, the quantum of rent determined can be safely termed as fair. The appeals are devoid of any merit as they do not raise any substantial question of law and they are accordingly dismissed. No costs. (A.K. MENON, J.) (S.C.DHARMADHIKARI, J.)