Ajit K. Sengupta, J. - (1.) In this reference under Section 256(1) of the Income-tax Act, 1961, for the assessment year 1081-82, the following question of law has been referred to this court : " Whether, on the facts and in the circumstances of the case, the income from house property was assessable in the hands of the assessee ?"
(2.) The facts leading to this reference are that the assessee, a private limited company, was dealing in gram, chana and chuni and it had no manufacturing activities. It was also the owner of a property at 58/2, Ballygunge Circular Road, Calcutta. It filed an ejectment suit against the tenant which was pending during the assessment year under reference. The assessee claimed that, in computing the income from house property, the legal charges of Rs. 5,264 spent by it in the course of the ejectment suit should be deducted. The Income-tax Officer taking note of the provisions of Section 24(1) of the Act did not allow the same and computed the income from house property after allowing statutory deduction for repairs and collection charges of Rs. 6,089.
(3.) On appeal before the Commissioner of Income-tax (Appeals), it was contended that the rent receivable should not have been taken as determined by the Calcutta Corporation. Considering the amendment brought by the Taxation Laws (Amendment) Act, 1975, the Commissioner of Income-tax (Appeals) rejected the claim of the assessee. He also rejected the claim of the assessee for deduction of legal charges of Rs. 5,264 on the ground that there was no such provision for deduction under Section 24(1) of the Act. Being aggrieved, the assessee moved the Tribunal.;