« From the Courts » Open DEMAT Account in 24 hrs  Allahabad HC Orders GSTN to Modify Portal within 1 Month to Allow Appeals Even When Disputed Tax Shows Nil  Statement Recorded By High Courts Can't Be Later Contradicted By Counsel : Supreme Court «  ITAT can allow amends in I-T return if appeal filed within 4... Flaws in DoT's M&A norms: TRAI... » ITAT rules on determining rental income for tax liability June, 05th 2008 The Income Tax Appellate Tribunal has ruled that the standard rent of property value, used in determining the taxability of house properties, could be determined by applying a rate of 10% to the aggregate value of the actual cost of construction and the market price of the land at the time of commencement of the construction. The judgement follows an appeal by the revenue department against an order of the Commissioner of Income Tax (appeals) on the tax liability in respect of the property of a Delhi-based company. The CIT had turned down a revised assessment of the tax liability of the companys property by the assessment officer. Challenging the order of the CIT, the revenue department said that certain modifications and alterations were done in the assessed property and hence its value required an applicability of the revised taxation rates. It was submitted that no revision of the rent received was made, and hence it should be revised as according to the relevant provisions of the Delhi Rent Control Act. The tribunal bench said that the apex court had ruled that if the standard rent of the property is not fixed or revised by the rent controller, the assessing authority was at liberty to arrive at its own figure of standard rent by applying the principles laid down in the Delhi Rent Control Act. The determination of the annual value is to be made at a sum for which the property might be reasonably expected to let from year to year and the same is to be compared with the actual rent received. If the rent so received or receivable is higher than the amount at which it would be reasonably expected to let from year to year, then the actual rent received will be adopted as an annual value, the tribunal order said.