KUSHAL DAS DAYARAM MANGHANANI ,HYDERABAD vs. INCOME TAX OFFICER, WARD-5(3), HYDERABAD

We notice at the outset that assessee's instant appeal suffers form 80 days delay in filing. Learned counsel submitted that due to the papers had been misplaced by office staff and could not be filed in time. He requested to condone the delay and there is a reasonable cause for filing the appeal belatedly by 80 days. Case law Collector Land Acquisition Vs. Mst. Katiji & Ors, 1987 AIR 1353 (SC) and University of Delhi Vs. Union of India, Civil Appeal No.9488 & 9489/2019 dated 17th Dec., 2019, hold that such a delay; supported by cogent reasons, deserves to be condoned so as to make way for the cause of substantial justice. We accordingly hold that assessee's impugned delay of 80 days is neither intention nor deliberate but due to the circumstances beyond his control. Case is now taken up for adjudication on merits.

We now come to the assessee's grievance that Pr.CIT’s revision order dt.7.3.2019 in issue has erred in law and on facts in treating the regular assessment dt.30.11.2016 as Revenue. Relevant facts qua instant issue involving exercise of 263 revision jurisdiction as per the PCIT’s directions are in a narrow compass. We deem it appropriate first of all to extract the PCIT’s revision directions herein as under :

Both parties reiterated their respective stand against and in support of the PCIT’s foregoing revision direction. There can hardly be any dispute that this revision jurisdiction comes into play incase the corresponding regular assessment is both are erroneous one as well as causing prejudice to the interest of Revenue, simultaneously, as per hon'ble apex court land mark decision in Malabar Industrial Co. Ltd. Vs. CIT (2000) 243 ITR 83 (SC). The fact also remains that whether or not an assessment suffers from the foregoing twin elements or not depends on the corresponding facts and circumstances only. Their lordship’s further make it clear that it is not each and every assessment which could be revised u/s. 263 section only those wherein the Assessing Officer has not exercised one of the two possible views.

We keep in mind the foregoing legal proposition and revert back to the facts of the instant case. There is no quarrel between the parties that the assessee had leased out the premises in issue to his son Sri Rajesh Mangani for carrying out furniture business. It is further an admitted fact that the assessee has not derived any rental income in the relevant previous year therefrom. Learned PCIT has directed the Assessing Officer to apply section 23(1)(a) of the Act and determine the Annual Letting Value (ALV) of the rented premises. We find no reason to sustain all these directions for the reason that learned CIT’s impugned order has given the instant issue an altogether a new footing. We observe so keeping in mind that this is an instance of non- collection of rent than lack of determination of ALV u/s. 23(1)(a) of the Act only wherein the assessee had not actually received his rent which was already determined. We further emphasise that as this is not the first assessment year of the impugned property being given on rent. We wish to make it clear that so far the already determined rent is concerned, there is a special provision dealing with recovery of arrears of rent and unrealized rent received subsequently u/s. 25A of the Act. We thus go by the very reasoning to reverse the learned Pr.CIT’s revision directions on this count alone and conclude that the Assessing Officer’s regular assessment herein dt.30.11.2016 had been rightly framed without determining or adding the rent amount not actually collected and assessed in assessee's income stands. The same is restored as the necessary corollary. 6. This assessee's appeal is allowed in above terms.