Case Law Details
Mantri Developers Private Limited Vs DCIT (ITAT Bangalore)
As per these provisions, even if the building is not actually let out and the assessee is not occupying the same for the purpose of business, Annual Value of the building is to be estimated at the sum for which the property might reasonably be expected to let from year to year and it is brought to tax. Hence, actual use is not a precondition to bring the property to tax under the head Income from House Property.
Section 22 is not applicable in a case where the property is occupied by the assessee for business purpose and we find that in the present case, the property is ready on 24.09.2013 but still, the AO has not brought its Annual Value to tax in the present year under the head Income from House Property and this also indicates in our opinion that the AO also accepts silently that the building in question is occupied by the assessee for business purpose and he states this objection only that it was not put to use in the present year because actual let out has happened subsequently.
Hence, by respectfully following the judgments noted above, we hold that the AO should allow the claim of depreciation on this basis that the building was put to use for the purposes of the business on 24.09.2013 i.e. the date of completion and keeping this in mind that the assessee was already in the hunt for lessee and keeping this also in the mind that this is not the case of the AO or CIT (A) that income from this house property is taxable under the head income from house property and not under the head income from business because had it been the case of the AO or CIT (A), Annual Value would have been brought to tax and deduction would have been allowed of interest u/s 24 and only depreciation would have been disallowed.
FULL TEXT OF THE ITAT JUDGEMENT
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