OMPRAKASH RAMSURAT YADAV,MUMBAI vs. DCIT- CIRCLE 24(1), MUMBAI

The ld. CIT(A) has confirmed the addition interalia on the ground that the appellant’s case is not covered by Clause (a) – (c) of Section 21(3) of the Act, hence this appeal.

We have heard parties. Perused record.

At the outset, it is necessary to note that the appellant has filed an application under Rule 29 of the Income Tax Appellate Tribunal Rules, 1963 (‘Rules’ for short) for production of additional evidence namely a certificate dated 11.12.2025 from the said Trust (lessee) requesting the appellant for reduction of rent and an Affidavit dated 16.12.2025 of the appellant accepting the request. It is contended that the appellant could not produce the certificate and the Affidavit before the authorities below.

It is submitted by the ld. AR that the Annual Letting Value (ALV) ought to have been accepted and determined at Rs.21,00,000/- representing the actual rent received which according to the appellant is higher than the fair rent of Rs.17.70 lakhs in accordance with the provisions of Section 23(1)(b) of the Act. It is submitted that in appellant’s own case for A.Y.2013-14 and 2014-15, the ld. CIT(A) had accepted the fair rent / ALV being 5% of the capital value of the property, worked out on the basis of the ready reckoner rate prevailing at the relevant time. It is pointed out that for these years, the ld. CIT(A) had directed the ld. Assessing Officer to work out the allowance and give

The ld. DR has submitted that the certificate from the Trust and the Affidavit filed by the appellant are self-serving documents. It is pointed out that the appellant is one of the trustees, even Mr. C.L. Dubey is the Managing Trustee of the Trust. Thus, no reliance could be placed on the additional evidence now sought to be produced. It is submitted that the ld. CIT(A) is justified in finding that the case is not covered by Clause (a) to (c) of sub-Section 1 of Section 23 of the Act.

We have considered the submissions made.

Indisputably, the rent initially agreed was Rs.36,00,000/- per annum which according to the appellant was reduced on the request from the Trust to Rs.21,00,000/- per annum. It is true that both Mr. C.L. Dubey and the appellant are Trustees of the Trust. However, we have to consider whether the claim that the rent was reduced to Rs.21,00,000/- can be accepted and the effect thereof, on the ALV as determined u/s.23(1) of the Act. It can be seen that Clause (a) of sub-section 1 of Section 23 envisages a situation where the property is not actually let out in which case, the sum for which the property might reasonably be expected to be let from year to year has to be reckoned. Clause (b) of sub-section 1 of Section 23 is applicable where the property is actually let out. It provides that where the property or any part thereof is let out and the actual rent received or receivable by the owner in respect thereof is in excess of sum referred to in Clause (a), the amount so received or receivable has to be taken as the annual value. The ld. AR has submitted that normally in respect of commercial

In our considered view when the facts in the assessment year in question are identical, the rule of consistency would be attracted. The Hon’ble Bombay High Court in the case of Gopal Purohit and Aroni Commercial Ltd (supra) had held that although the principle of res judicata are not applicable to tax matters as each year is separate and distinct, nevertheless where facts are identical from year to year, there has to be uniformity and consistency in treatment. We find that the principle is clearly attracted in this case.

In that view of the matter, the appeal is allowed. The Assessing Officer is directed to take the estimation of the Annual Letting Value at 5% of the capital value of the property and work out the allowance and to give relief accordingly.

In the result, appeal is allowed in the aforesaid terms.