Income Tax Addition on Deemed letting value not permissible when property was not let out: ITAT [Read Order]

The Chennai Bench of the Income Tax Appellate Tribunal (ITAT) has held that addition on deemed letting value not permissible when the property was not let out and deleted the addition.

The respondent was represented by Shri P. Sajit Kumar while none appeared for the assessee.

Selvaraj Shanthamani, the assessee is aggrieved by confirmation of certain additions of Rs.13.51 Lacs which represent deemed letting value of four properties owned by the assessee.

It was observed that the impugned addition represents deemed letting value of 4 properties owned by the assessee at MasagoundenChettipalaym, Annur S.F.No.655/3C, Site Nos. 37 to 40 and the properties have been considered by AO as deemed to be let out.

The assessee stated that these properties were vacant land which was rejected by CIT(A) on the ground that the assessee could not produce complete details and evidence to substantiate that the four properties were vacant land and there was no construction done in the said land. 

The Village Administrative Officer has certified these properties as vacant sites. The said certificates were furnished by the assessee during e-proceedings also. The assessee, vide submissions dated 24.02.2021, submitted that these properties were vacant sites only and no income was derived from these vacant sites. To support the same, the payment receipts of vacant site development charges as paid to local authorities were also furnished.

A Coram of Shri Manoj Kumar Aggarwal, AM observed that the documents would show that the four sites were vacant land only which could not be deemed to be let out and the lower authorities have failed to consider these documents.

While allowing the appeal of the assessee the Tribunal deleted the impugned addition. 

To Read the full text of the Order CLICK HERE

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