PREM RAJ LOONAWAT Vs. COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) The Income-tax Appellate Tribunal has referred the following question of law arising out of its order dated July 6, 1982, in respect of the assessment year 1978-79 under Section 256(1) of the Income-tax Act, 1961 :

(2.) The brief facts of the case are that the assessee is a partner in the firm, Anand Gum Industries, Jodhpur, carrying on business at Bombay. The assessee-firm purchased a flat known as "Matri Ashish" at Napean Sea Road, Bombay, for a sum of Rs. 1,71,000. The assessee, who is looking after the business of the firm at Bombay, occupied two-thirds portion of the said flat for his personal residence and the remaining one-third portion was used for the purpose of the business of the firm. The Income-tax Officer was of the view that the assessee derived the benefit or perquisite because of the occupation of the flat and, therefore, Section 28(iv) of the Income-tax Act was attracted. The value of such 'benefit was estimated by the Income-tax Officer at Rs. 8,000 on the basis of the decision of the Commissioner of Income-tax (Appeals) in respect of the assessment year 1977-78 where a similar addition was upheld by the Commissioner of Income-tax (Appeals). The decision in the case of M. Ct. Muthiah v. CIT [1974] 97 ITR 516 (Mad) was also taken into consideration.

(3.) In appeal before the Commissioner of Income-tax (Appeals), the order of assessment was upheld. The matter was challenged before the Income-tax Appellate Tribunal and following the view taken in the previous assessment year, the second appeal was also dismissed.