Fair Market rent on a house property u/s 23(1)(a) of Income Tax Act to be determined considering all relevant factors

1 comments Wednesday, May 11, 2011
I have found the following Judgment of Mumbai ITAT in the case namely Tivoli Investment & Trading Co. vs ACIT as a good one on determination of Annual Rental value u/s 23(1)(a) of Income Tax Act, 1961. As we know for determining annual value of a house property standard rent or municipal value, actual rent, Fair market rent all factors have to be considered. Where rent is reduced due to high security deposit by the tenant, then AO is not bound by standard rent or the municipal value.

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Prior payment of 25% before entertaining appeal u/s 62(5) of PVAT Act has to be of total tax penalty and interest.

Section 62(5) of Punjab VAT Act provides for a mandatory condition of minimum payment of 25% of the total tax, penalty and interest, if any before any appeal under Punjab VAT Act 2005 is entertained.

Section 62(5) of PVAT Act runs as under:

“No appeal shall be entertained, unless such appeal is accompanied by satisfactory proof of the prior minimum payment of twenty five per cent of the total amount of tax, penalty and interest, if any”
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