HERCULES HOISTS LIMITED,RAIGARH vs. DEPUTY COMMISSIONER OF INCOME TAX, MUMBAI

ITA 5442/MUM/2024Status: DisposedITAT Mumbai18 July 2025AY 2018-19Bench: SHRI SAKTIJIT DEY (Vice President), SHRI PRABHASH SHANKAR (Accountant Member)7 pages
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What did the Tribunal hold?

The Tribunal remanded the issue of ALV determination back to the AO, directing strict adherence to the guidelines laid down by the Bombay High Court in CIT vs. Tip Top Typography for computing ALV based on Municipal Ratable Value. For the disallowance under Section 14A read with Rule 8D, the Tribunal directed the AO to restrict it only to investments that yielded exempt income during the year.

What were the facts?

The assessee, owner of a property vacant since 2004-05, claimed vacancy allowance under Section 23(1)(c) and did not offer income from house property. The Assessing Officer (AO) computed Annual Lettable Value (ALV) on a notional basis, disregarding the Municipal Ratable Value (MRV) and the Tribunal's previous directions to follow the guidelines from CIT vs. Tip Top Typography. Additionally, the assessee contested disallowances made under Section 14A read with Rule 8D.

What were the issues?

1. Whether Annual Lettable Value (ALV) for a vacant property should be determined based on Municipal Ratable Value (MRV) as per CIT vs. Tip Top Typography. 2. The extent of disallowance under Section 14A read with Rule 8D for expenses related to exempt income.

Which sections of the Income-tax Act were involved?

Section 22,Section 23,Section 23(1)(a),Section 23(1)(c),Section 14A

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Cases cited in this judgment(6)Show list

Detected automatically from the text. Citations are also linked where they appear in the judgment. The count shows how many other judgments on BharatTax rely on the same authority.

Income Tax Appellate Tribunal, “E” BENCH, MUMBAI

Before: SHRI SAKTIJIT DEY, VP & SHRI PRABHASH SHANKAR, AM

For Appellant: Shri Vasanti Patel
For Respondent: Shri Hemanshu Joshi
Hearing: 15.07.2025Pronounced: 18.07.2025

Per Saktijit Dey, VP:

The captioned appeals by the assessee, arise out of separate orders passed by National Faceless Appeal Centre (NFAC), Delhi, pertaining to assessment years (A.Y.)

2012-13, 2014-15, 2017-18 and 2018-19. ITA Nos. 5444/Mum/2024 & 5445/Mum/2024 (A.Ys. 2014-15 & 2012-13)

2.

The only common ground raised in both these appeals reads as under :

1.

Income from house property: The learned Assessing Officer and the learned CIT(Appeals) failed to appreciate that the provisions of Section 22 and 23 were clearly not applicable on the facts and in the circumstnaces of the case and in law. It

The order continues below.

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