- (1.) This appeal has been admitted for hearing by an order dated 16th May, 2005 on the following substantial questions of law:- (i) Whether the Tribunal acted within its authority and/or jurisdiction by directing assessment of arrears of rent in the year of receipt and upholding the reopening of the assessments for the assessment years 1993-94, 1994-95 and 1995-96 on such basis when the assessments were reopened and orders were passed by the Assessing Officer on the ground that increase in rent agreed upon subsequent to the relevant previous years with retrospective effect was chargeable to tax in the previous years to which such increase related and the purported findings of the Tribunal in this behalf are beyond the scope of the appeals before it (ii) Whether and in any event and upon a true and proper interpretation of the relevant provisions of the Income Tax Act, 1961 as they stood in the previous years relevant to the assessment years 1993-94, 1994-95 and 1995-96, arrears of rent received in the said years though in respect of earlier years could be subjected to tax in the years of receipt (iii) Whether the Tribunal was justified in law in holding that the ratio of the judgment of this Hon'ble Court in the case of Hope India Ltd., - vs.- CIT,1999 138 ITR 740 was that arrears of rent were taxable in the year of receipt and the purported finding of the Tribunal that any such concession was made by the appellant's authorised representative is arbitrary, unreasonable and perverse (iv) Whether the Tribunal was justified in law in upholding the reassessments for the assessment years 1993-94, 1994-95 and 1995-96 on the purported ground that arrears rent received in the said years had escaped assessment by reason of the appellant's failure to include the same in its taxable Income The present appeal was preferred and admitted for hearing because of part dismissal of the appeal by the learned Tribunal in relation to the assessment years 1993-94, 1994-95 and 1995-96.
(2.) The brief fact of the case is that the appellant-assessee is a co-owner of the property situated at 8A, Lindsay Street, Calcutta which has been let out to various tenants. The income from house property by way of rent actually received by the appellant during the previous years relevant to the assessment years was under consideration. The assessment for all years namely 1990-91, 1991-92, 1992-93, 1993-94, 1994-95 and 1995-96 under consideration was completed under Section 143(1) in respect of the assessment years 1995-96 on 26th July 1996. The assessment of these years under consideration under Section 143(3) of the Act was completed on 26th July, 1996. In view of the information that the assessee had received arrears of rent pertaining to the years under consideration after the assessee filed returns declaring income received during the said assessment years originally, the Assessing Officer reopened the same.
(3.) The Assessing Officer observed that assessee has received following arrears of rent pertaining to the respective years: Arrear rent received Relatable to Amount assessment years in assessment years 1993-94 1988-89 to 1992-93 Rs.7,84,047/- 1994-95 1991-92 to 1993-94 Rs.1,15,200/- 1995-96 1988-89 to 1994-95 Rs.56,63,016/- 1996-97 1993-94 to 1995-96 Rs.12,07,251/- 1997-98 1993-94 to 1996-97 Rs.4,53,073/-;