Smt. Shivani Madan Vs PCIT (Delhi High Court)
Delhi High Court held that deeming income from house property @50% merely on the assumption that assessee was signatory to the instrument is untenable in law since assessee doesn’t own beneficial interest in the property.
Facts- In the course of assessment, the appellant was placed on notice to answer a query as to why income from the said property be not charged to tax in her hand under the head of ‘income from house property’. The appellant explained that the property is essentially owned by the spouse and that her name appears in the instrument solely for and in light of a contribution of INR 20,00,000/-, which was paid by her in A.Y. 2011-12. This explanation was not accepted by the AO, who proceeded to hold that the property would be liable to be viewed as being jointly owned in equal share by the appellant and her spouse and thus taxed in accordance with Section 23(1)(a) of the Act. The AO proceeded further to thus compute the annual letting value and held that the income from house property would be liable to be pegged at INR 19,60,000/- and 50% thereof being assessed in the hands of the appellant. CIT(A) confirmed the same.
