Delhi High Court: Information From Property Dealers Or Websites Not Cogent Evidence On Adequacy Of Rent For Invoking Section 13(2)(B) Of Income Tax Act
According to Delhi High Court bench led by; Justices Manmohan and Navin Chawla, in the nonappearance of an independent inquiry, the revenue authorities cannot solely rely; on the opinion of property brokers and websites to determine the; adequacy of rent received for invoking section 13(2)(b) of the Income Tax Act, 1961.
In one assessment year, the Assessee had agreed to lease its property to the Wakf. The Assessing Officer (AO) concluded that; the property let out to the Wakf at a much lower rate than; the market rate, based on inquiries made to estate agents and information gathered from websites, and thus; invoked the provisions of section 13(2)(b) of the Act. The ITAT ordered that; the AO’s additions be deleted. Against the challenged order, the revenue authorities filed an appeal with the High Court.
The Revenue Department’s counsel argued that; the AO obligated by the Act to investigate whether any part of the; charitable trust’s income or property is utilized for the benefit of a specified person. The Assesses claimed that; it had been leasing its property to the Wakf under a Lease Agreement since 1981, which; the Revenue had previously recognized without invoking section 13(2)(b) of the Act. The Assessee argued that; the ITAT correctly noted that; the rent collected from the Wakf is greater than the benchmark rate under the Delhi Rent Control Act, 1958.
The court noted that; the ITAT had found that the material collected by the AO from the Internet and the estate agents could not be considered as collaborative piece of evidence, and that; the law requires the revenue authorities to bring on record cogent evidence to justify the invocation of section 13 of the Act, while allowing the appeal in favour of the Assessee.
The court ruled that; the market rate not the sole criterion for evaluating the adequacy of rent, and that; the tax authorities have the burden of proving that; the rent charged by the Assessee was insufficient.
The court denied the; appeal of the tax authorities, upholding the ITAT’s decision and holding that the invocation of section 13(2)(b) of the Act manifestly faulty given the absence of any independent investigation by the AO.
Read more blogs@advocatetanwar.com
Hey!
Want some free leads or data for your business?
Visit us: DataList2023.com
Hello,
We noticed advocatetanwar.com is only listed in 8 out of 2500 directories.
This severly impacts your backlinks and search engine rankings.
Come get listed in all 2500 directories on DirectoryBump.com
Hey!
Come test out our beta project LeadsFly.biz and come get your free business leads.
Regards,
Vaughn
Hi advocatetanwar
We are proud to present our new website for all your B2B and B2C data and advertising needs.
https://advocatetanwar.marketingfriend.biz
We offer a large range of products and to assist you in getting ahead this new yeah with better advertising and reaching more clients in your specific niche. Our products include all of the following:
We provide a free live search on site so you can see the amount and type of data we provide.
Pre-compiled B2B and B2C data sets with all the necessary fields\columns included to assist you reach your clients.
If we do not currently have the data you are looking for we are also willing to assist with custom data collection.
Mail servers setup for you able to send over a million mails per day or as per your specifications.
“Stopping advertising to save money is like stopping your watch to save time.” Henry Ford.
https://advocatetanwar.marketingfriend.biz
Regards,
MarketingFriend.biz
Hi
If you need some fresh new leads for this last push to the end of the year, look no further.
At blulinedata we have done all the hard work for you, offering fresh data sets all ready for use. Every data set you buy from us gaurantees you a new contact. Our datasets have already been cleansed for you, having not a single record without contact information.
We are growing our data sets to cover the whole world and any industry you can think of.
Every dataset is priced per record so never end up spending money on excessively large datasets you do not actually need.
Feel free to browse through our current selection and request any country you would be interested in via our chat.
For an end of year special, enter chat requesting bludata sale discount to get up to 50% discount on any data.
Regards,
BluLineData.com