PANNA LAL TALWAR Vs. COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) THIS judgment will dispose of Income-tax References Nos. 110 and 111 of 1979. The said references pertain to assessment years 1974-75 and 1975-76, respectively.

(2.) THE common dispute involved in both the references relates to the estimate of the gross annual letting value of building No. 349/13, situate at Mall Road, Amritsar. The building is said to have been constructed in the year 1938. For the years under consideration, the assessee declared the gross annual letting value of the building at Rs. 6,000 each but the ITO valued it at Rs. 12,000. The AAC, in appeal, confirmed the gross annual letting value at Rs. 12,000, as estimated by the ITO. The assessee filed an appeal which was dismissed by the Tribunal. The contention raised on behalf of the assessee before the Tribunal was that in view of the provisions of the East Punjab Urban Rent Restriction Act, 1949, the assessee could not charge more than the fair rent determined under the provisions of the said Act and thus the annual letting value of the house could not be more than what the assessee could, in law, get as rent if the premises were rented out. The Tribunal placing reliance on a judgment of their Lordships of the Supreme Court in M. M. Chawla v. J. S. Sethi [1970] 2 SCR 390 rejected the contention of the assessee.

(3.) ON an application being made by the assessee, the Tribunal has referred the following question of law to this court for its opinion : "whether, on the facts and in the circumstances of the case, the Tribunal is right in law in holding, having relied on the Supreme Court Reports, Volume 2 [1970] p. 390 (M. M. Chawla v. J. S. Sethi), that the Income-tax Officer is not bound to consider the fair rent determinable under the provisions of the East Punjab Rent Restriction Act, 1949, for determining the annual letting value of a self-occupied property for which the fair rent was never determined by the Rent Controller, in terms of Section 23 of the Income-tax Act, 1961 ? "