TUPUR CHATTERJI Vs. THE ACIT
INCOME TAX APPELLATE TRIBUNAL
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I.P.Bansal, Member (J) -
(1.) THIS is an appeal filed by the assessee. It is directed against order passed by Ld. CIT(A) -3, Mumbai dated 23/12/2011 for assessment year 2008 -09. Grounds of appeal read as under:
1. On the facts and in the circumstances of the case, the learned Commissioner of Income Tax (Appeals) -3, Mumbai erred in not giving directions to the AO to adopt Municipal Rateable Value for computing. income of second property, acquired during the year, which remained idle, on the ground that the details of ALV were not furnished by the appellant. The AO may be directed to adopt Municipal Rateable Value for second property as per the decision of the jurisdictional Bombay High Court in the case of M. V Sonavala V CIT ( : 177 ITR 246)
(2.) ON the facts and in the circumstances of the case, the learned CIT(A) -3 Mumbai erred in not allowing the full interest of Rs. 3,50,641/ - paid for the second property, as the same was treated as deemed let out by the AO.
2. Ld. AR of the assessee did not press Ground No. 1, therefore, the same is dismissed as not pressed.
Apropos Ground No. 2, the facts are that the assessee is owner of two properties, one of which is Flat No. 101, Marble Arch, Pali Hill, Bandra and the other is 203, Nestle -1, A -Wing, P.B. Marg, Mumbai. Flat at Bandra has been considered to be self occupied property and property in Nestle is vacant property upon which AO has applied ALV at 7% of book value of the property and computed deemed house property income of Rs. 1,40,185/ - as per following calculation:
3.1. For buying aforementioned property the assessee had obtained loan from the bank for which interest of Rs. 3,50,641/ - was paid, which was restricted by the AO to a sum of Rs. 1,40,193/ - on the ground that assessee could not be allowed a cumulative deduction more than Rs. 1,50,000/ - as per second proviso to section 24 of the Income Tax Act, 1961 (the Act). The Ld. CIT(A) has upheld the action of A.O. The assessee is aggrieved, hence has filed aforementioned ground No. 2.
(3.) AFTER narrating the facts it was submitted by Ld. AR that the claim of the assessee is allowable in its entirety in accordance with clause (b) of section 24 of the Act. He submitted that the restriction of Rs. 1,50,000/ - is with regard to property on which sub -section (2) of section 23 is applicable. Ld. AR referred to the provisions of section 24 as well as section 23(2) of the Act and it was his case that only property in the shape of Flat at Bandra will fall within the ambit of section 23(2) and the restriction of interest would be applicable to that property and in respect of Nestle Property no interest limit is fixed by the statute.;
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