COMMISSIONER OF INCOME TAX Vs. AMALGAMATIONS LIMITED

JUDGEMENT

(1.) AT the instance of the Revenue, the Income tax Appellate Tribunal has stated a case and referred the following two questions of law relating to assessment of income of the assessee for two assessment years 1977-78 and 1978-79, namely :

(2.) THE assessee is a company in which the public are not substantially interested. We are concerned with two assessment years, i.e., 1977-78 and 1978-79. THE asscssee is the owner of two residential properties one at No. 27, First Main Road, Adyar, and the other at No. 25, Kasturi Ranga Iyengar Road, Alwarpet, Madras. THE property situate at Adyar was let out to a sub-sidiary company, India Pistons Repco Limited, for Rs. 6,000 per annum. THE annual letting value of the said property determined by the Corporation of Madras for the purpose of levy of property tax was Rs. 5,460. THE Aiwarpet property was let out to another subsidiary company, Addison Paints and Chemicals, at Rs. 9,000 per annum whereas the annual letting value determined by the Corporation was Rs. 8,190.

(3.) WE have perused the facts. The contention of the Revenue in this regard is that the Commissioner has noticed the location of the properties, the size of the building, the area of the land and taking into account all those material facts and also taking into account the general increase in the rental value of the property, the Commissioner was of the view that there must be reappraisal or re-determination of the rental value of the properties. Learned counsel for the Revenue contended that rent was determined for the year 1972-73 and there was no change in the rental value of the property from the year 1972-73 and, therefore, the Commissioner has taken into account the general increase in the rental value of the properties and, therefore, he directed the Income-tax Officer to examine the matter afresh. According to counsel for the Revenue, the Commissioner has jurisdiction to revise the orders of the Income-tax Officer as the power of the Commissioner is of wide amplitude and the Commissioner on materials came to the conclusion that the annual value determined was erroneous and prejudicial to the interests of the Revenue.