GURPREET SINGH DHILLON,INDIA vs. DCIT, CIRCLE INT TAX 1(2)(2), DELHI

ITA No.- 3600/Del/2025 Gurpreet Singh Dhillon “5.1 Point No. 3-3.1 - Regarding the above variation it is submitted that as per Lease Deed in year 5, Gross Total Rent comes to Rs. 1,79,26,200 being 12 month rent in the year 4 to year 6 @Rs.14,93,850 per month. Whereas the assessee has offered to tax Rs, 1,74,90,743 and there is a difference of Rs. 4,35,457 in the gross rent. Kindly refer to the Form 26AS received from the Government Portal of Income Tax. The Tenant Indo Rama Synthetics (India) Limited has shown rent paid as Rs. 1,74,90.743 and TDS of Rs 55,27,092. The assessee has declared the above amount received from the tenant as Gross Rent Received under Income from House Property. Accordingly same has been shown as Gross Rent under the Schedule HP inadvertently.”

2.2 The AO did not accept the above submission of the assessee and made an addition of Rs. 4,35,457/-. The relevant extract of the assessment order is as under: “ The submission of the assessee was perused. The assessee has declared rental income of Rs. 1,74,90,743/- instead of Rs. 1,79,90,743/- as per Lease Deed between the assessee and the tenant (Indo Rama Synthetics (India) Ltd). The assessee has itself accepted that it has received rent of Rs. 1,79,90,743/- instead of Rs. 1,74,90,743/-, as declared by the assessee. Hence the amount of Rs. 4,35,457/- is added back to the income of the assessee as rental income. The penalty u/s 270A for underreporting of income….”

“1. The order dated 24.04.2024 passed by the Ld. Assessing Officer, DCIT, Circle 1(2) (2), International Taxation New Delhi, AND the addition confirmed by the Ld. Commissioner of Income Tax (Appeals), New Delhi-42 are bad in law AND on facts, AND are against the principles of natural justice, AND therefore deserve to be quashed.

ITA No.- 3600/Del/2025 Gurpreet Singh Dhillon 2. That the Ld. Assessing Officer has erred in making an addition of Rs. 4,35,457/- under the head "Income from House Property," AND the Ld. CIT(A) has further erred in confirming the said addition without properly appreciating the facts AND submissions made by the appellant assessee. The said addition has resulted in double addition of the same amount to the total income, which is unjustified. The authorities below have grossly erred in law AND on facts in making AND confirming such an addition, which is bad in law, contrary to facts, AND in gross violation of the principles of natural justice. The addition, therefore, deserves to be deleted.

3. That the appellant craves leave to add, amend, alter, DELETE, modify, AND/OR withdraw any of the above ground(s) of appeal at OR before the time of hearing.”

5. The Ld. AR explained the facts and submitted that the amount of Rs. 4,35,457/- was already offered to tax in earlier assessment years and an excess rent of Rs. 7,46,925/- was declared till A.Y. 2021-22 and, therefore, again taxing the said amount would lead to impressible double taxation. In this regard, the Ld. AR also filed a reconciliation statement to support the claim of the assessee. The relevant submissions of the assessee in para no. 4 to 6 are reproduced as under:

“4. Assessee submitted before CIT(A) that in AY 2018-19, being the first year of tenancy, advance rent of Rs. 45,46,500/- i.e. 3.5 months, was received, on which TDS was inadvertently claimed in the ITR as it appeared in Form 26AS. Since the time for revising the return had expired, the assessee surrendered this amount to tax in AY 2018-19 in appeal, though it actually pertained to AY 2019-20. Consequently, there were short adjustments in subsequent years. A detailed reconciliation, supported by Form 26AS and ITRs, clearly demonstrates that till AY 2021-22, the assessee had already declared excess rent of Rs. 7,46,925/-. Thus, sustaining the impugned addition once again in AY 2022-23 leads to impermissible double taxation.

ITA No.- 3600/Del/2025 Gurpreet Singh Dhillon Therefore, the addition of Rs. 4,35,457/- in respect of rent variation under "Income from House Property" results in double taxation, which is impermissible in law.

6. Reference is made to the following judicial precedents where it has been categorically held that the same income cannot be taxed twice: (i) Biswas Manik v. Income-tax Officer [2025] 177 taxmann.com 369 (ITAT Ahmedabad Bench "SMC") (ii) Deputy Commissioner of Income-tax v. M.C. Hospital [2022] 142 taxmann.com 122 (ITAT Chennai Bench "B") Further in PCIT v. Dwarka Prasad Aggarwal [2024] 161 taxmann.com 813 (SC) -held that additions made without properly examining the evidence furnished by the assessee cannot be sustained. Thus, the impugned addition ignores the reconciled position, Form 26AS, and the settled principle that the same income cannot be taxed twice.”

ITA No.- 3600/Del/2025 Gurpreet Singh Dhillon 7.1 On perusal of the above chart, it is seen that the assessee had declared a sum of Rs. 45,46,000/- and Rs. 97,425/- of excess rent in AY 2018-19 and 2021-22 and short rent of Rs. 38,97,500/- in AY 2009-10, thus, declaring an excess of Rs. 7,46,925/- till AY 2021-22 and the said amount is in excess of Rs. 4,35,457/-, which was added by the AO. Further, the explanation of the assessee about the above excess / less rent being declared in the respective assessment years is also acceptable. Therefore, in the given facts of the case, the taxing of the said amount of Rs. 4,35,457/- would amount to double taxation. Accordingly, we hold that the said addition of Rs. 4,35,457/- is not sustainable and the same is deleted. Ground no. 2 of the appeal is allowed.