deepu (CA ) (45 Points)
27 January 2011Dear all,
Please advice me on the following...
Mr. x owns 2 houseproperties. He has been residing in one (say HP-1) for the whole year and the other one has been vacant (HP-2) for the whole year.
As per my understanding since HP-1 is self occupied for the whole year, the GAV is Nil.
HP-2 is deemed to be let out. If so since loss due to vacancy is the actual rent receivable, the GAV is 'Nil' .
Hence in this case is Mr. X not liable to pay tax on income from HP?.
M .K. Jha
(CA Final)
(484 Points)
Replied 27 January 2011
Dear Deepu,
In my opinion HP-2 deemed to be let out and deemed income should be taxable under the head of income from House property.
In your case,
GAV Nil due to vacancy but it is wrong to say that GAV Nil due vacancy cause if Expected rent is higher than Actual rent then higher should be taxable.
The rent is the highest of below -
then higher of above rent and Standard rent as per RENT CONTROL ACT lower of both shall be expected rent for the calculation of GAV.
Now,
Higher of
Expected rent
and
Rent received or receivable
should be taxable under the head of "INCOME FROM HOUSE PROPERTY"
Regards
MAYANK KUMAR JHA
deepu
(CA )
(45 Points)
Replied 27 January 2011
Hi all,
I will put it like this:
Municipal Value 12,00,000
Fair Rent 15,00,000
Standard Rent 10,00,000
Expected & Actual Rent Receivable (Rs. 1 Lac for 12 months) :12,00,000
Vacancy: 12 months
Please advice me what would be the GAV?.
Thanks
CAclubindia
