Higher of FR & MV subject to Standard Rent = RLV

Reasonable Lettable Value (RLV) to be compafred with Actual Rent (AR)...

if AR > RLV, Then Gross Annual Value Value will be AR...

If AR < RLV, ask yourself this question... why AR is less than RLV.....

If your answer to the above is vacancy allowance the GAV will be AR....  And if your answer is  other than vacancy allowance GAV = \RLV...

in your case,,,,,,

RLV = 14,400 & AR= 12,000 but vacant for 5 months....

even if u rented out for 12 months your actual rent is 12000 which is less than RLV means that your acutal rent is less not because of vacancy... therefore GAV = 14,400

This is only correct answer........

total solution is\

GAV = 14,400

less: muncipal tax paid by owner : nil (not given)

Net : std deduction (30%)

Thanks.... 

Samir Shaikh

CA Final 

paras ur anser is correct

I agree with Samir's answer.If Actual Rent is lower not only bcoz of vacancy then u has to take the higher fig. i.e. 14400.So Samir's above solution is correct and the right ans. is Rs.14400.

Dheeraj Sirs ans is correct... i.e. Rs.9400/-

Originally posted by : ρaraѕ
	n ya according to me it can be like this..:-   FRV = rs 14400 actual rent= rs 12000 whichever is higher => rs.14400   and as house was vacant for 5 mothns then actual rent for 5 months wud be rs.5000   hence amt taxable is rs.14400 - 5000 = rs.9400     correct me if m wrong..plzzzzz

Corrrect..........No Doubt....

 See.. 

in case of vacancy u/s 23(2) if actual rent is less than , expected rent (frv or anythng) owing to vacancy that means due to vacancy the we can opt for actual rent , that earned for 7 months.

1200*7 = 8,400

but in this case even if house wouldn't have been vacant then also actual rent would be less than expected rent i.e agar ghar rent pe naa bhi dete to bhi to actual rent expected rent se kam hi hota so this section 23(2) will not apply on this case.

So we will go with Rs.14400.

Suppose, you gave your house on rent to your friend at less rent as per market value.. and your friend vacanted for 5 months. So, income tax department thodna kam tax charge karega kyo ki hamara dost hai!

I was trying to be practical ,, if confused then tell me!

Over here some people are right with there answer i.e. Rs 14400 but the concept is not correct!

Thanx!

The correct answer is 14,400...

In computing GAV we have to compare between Actual rent & fair rent...

If the Actual rent > Fair rent, GAV= Actual Rent

If Fair rent > Actual rent, Then think further:

Whether Fair rent > Actual rent because of vacancy....? If yes, then take Actual rent as GAV...

If no, then take Fair rent as GAV,

By applying this u will get 14,400 as answer...

ya, Paras u  r correct.

thnx everyone fr ur help...

i got my answer..

What answwer you got Paras...?

Mr.Paras which answer you got????  14400 or 9400

In my opinion 9400/- is right

i think answer shud be rs.14400

bt if i follow my teacher it shud be rs.9400

ans is 14400-5000=9400 is correct since for gav first you should compaMRV or FRV  whichever is higher but restricted to standard rent (if applicable) here in our case it is not there

and compare the resultant value with actual rent received (i., 1000/- pm which is equal to 12000/-) only

and therefor in our case 14400/- is your value to be conside r for gav before givining loss due to vacancy and loss due to vacancy shoul be your actual rent received or receivable and not the notioal value of 1200/- per month and there fore answer is 14400-5000=9400