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Judgment
PER MANISH AGARWAL, AM:
The present appeal is filed by the Assessee against the order of Learned Commissioner of Income Tax (Appeals)-27, New Delhi [CIT(A) in short], dated 31.03.2025 in Appeal No. CIT(A), Delhi-27/10035/2021-22 arising out of the assessment order passed u/s 143(3) of the Income Tax Act, 1961 (the Act, in short) dated 25.01.2024 for Assessment Year 2022-23.
The assessee has taken following grounds of appeal:
“1.On the facts and circumstances of the case and in law, the assessment order passed by the assessing officer is bad-in-law.
2.On the facts and circumstances of the case and in law, the notice issued u/s 143(2) issued in this case is bad-in-law and without jurisdiction.
3.On the facts and circumstances of the case and in law, the assessing officer erred in completing the assessment at income of Rs. 13,35,340/- instead of Rs.9,50,340/-as returned by the appellant.
4.On the facts and circumstances of the case and in law, the assessing officer erred in making addition of Rs. 3,85,000/- (Gross Rs. 5,50,000/-) on account of income from House Property u/s 22 of the Act, and, therefore, the addition made by the AO is liable to be deleted.
5.On the facts and circumstances of the case and in law, the assessment order passed by the assessing officer is contrary to the provisions of section 148B of the Income Tax Act, 1961.
6.On the facts and circumstances of the case and in law, the assessing officer erred in charging interest u/s 234A, 234B and 234C of the Act.
7.On the facts and circumstances of the case and in law, the assessing officer erred in initiating penalty proceedings u/s 271AAB(1A) of the Income Tax Act, 1961.”
Heard both the parties at length and perused the material available on record. The solitary issue of dispute before us is the addition of Rs. 9,50,340/- made after allowing deduction u/s 24(a) of the Act of 30% from the rental income of Rs. 5,50,000/- alleged as less declared by the assessee. The AO alleged that assessee has shown rental income of Rs. 8,25,000/- whereas the actual rental income was of Rs.13,75,000/-, thus, there was a different of Rs.5,50,000/-. It was claim of the assessee that out of total gross rent receivable, as per amended rent deed executed between the parties due to Covid-19, rent for the period from April to June, 2021 was waived off. And the rent for the month of July, 2021 was decided of Rs. 75,000/. For the remaining period, monthly rent of Rs.1,50,000/- was decided. The assessee stated that it had raised invoices for the month of July to December and thus total rent of Rs. 8,25,000/- was declared. This fact further corroborated from the copy of the GSTR-9 that the annual report under GST Act. According to which as against total rent of Rs.11,75,000/- assessee has issued credit note of Rs.3,85,000/- and remaining Rs.8,25,000/- was declared as rental income under the GST Act. Both the lower authorities has failed to appreciate this fact and made the additions of the differential amount of the rent receivable. The assessee has received the rent of Rs.8,25,000/- only which was declared in the GST return. Since assessee has not raised any bills for the rent of remaining period, there is no occasion to hold that the rent for the remaining period was also received by the assessee. In view of these facts, we direct the AO to delete the additions made of Rs.3,85,000/- after allowing deduction u/s 24(a) of the Act. All the grounds of the assessee are thus allowed.
In the result, the appeal of the assessee is allowed.