COMMISSIONER OF INCOME TAX Vs. MODI INDUSTRIES LTD

JUDGEMENT

(1.) THIS judgment will dispose of the aforesaid reference. IT Ref. No. 74 of 1982 is in respect of the asst. yrs. 1965 -66 and 1966 -67, while IT Ref. No. 71 of 1982, is in respect of the year 1967 -68. The point involved in both the cases pertains to the computation of the annual letting value, though the questions of law have been differently worded. In respect of the asst. yrs. 1965 -66 and 1966 -67 (IT Ref. No. 74 of 1982), the question of law referred is as follows :

(2.) THE facts as found by the Tribunal, in the references, are similar as they pertain to the same property. It appears that some residential quarters were constructed by the assessee in the year 1948. Three -fourths of those quarters were let out to M/s Modi Industries Ltd. some time in the year 1949. The balance one -fourth of the quarters were in the possession of the assessee and had been allotted by it to its employees. It is the Modi Industries Ltd. which had let out the three - fourths of the quarters either to their employees or to some outsiders. Be that as it may, the finding of fact recorded by the Tribunal is that all these quarters had been let out a number of years ago.

(3.) WE are in respectful agreement with the aforesaid decision of the Allahabad High Court. In the present case also, it is not the contention on behalf of the Department that the rent which was agreed between the assessee and the tenants was not a reasonable rent at the time when the properties were let out. It is also not disputed that the provisions of the U.P. Rent Control Act were applicable and this being so, the ratio of the decision of the Allahabad High Court in Modi Spinning & Manufacturing Mills Co.'s case (supra) is clearly applicable.