The Income Tax Appellate Tribunal ( ITAT ), Mumbai bench has recently allowed relief to the well- known cricketer Sachin Tendulkar and held that he is eligible for vacancy allowances under Section 23 of the Income Tax Act as he was not able to find a tenant for his vacant flat at Saphire Park.
In the instant case, the Assessing Officer, while completing assessment, noted that the above property was vacant for the whole year for the reason that the assessee could not find a suitable tenant. He therefore, made additions towards rental income.
Before the Tribunal, the cricketer argued that he could not find a suitable tenant for that fiat although he was desirous of letting out the same on rent and had calculated the annual value as nil by claiming vacancy allowances and hence, he claimed benefit of section 23(1)(c) which duly permits deduction in this regard.
The Tribunal bench accepted the argument that the assessee had made reasonable effort by requesting the builder to identify the tenants for the concerned flat. Since appropriate tenant could not be find out, the flat remained vacant.
The bench found that the assessee has claimed that the said flat had remained vacant throughout the year despite assessee’s reasonable effort to let out the same.
“The assessee is a well renowned cricketer. He is furnishing the return of income of Rs.61,23,14,400/-. The let out value of the property in dispute is assessed as only Rs.1,26,000/- by the ld. Commissioner of Income Tax (Appeals) as rent for the whole year. When the same builder has helped the assessee to find tenant for another flat, why his letters to the same builder to help him identify one more tenant, can be considered as fake, defies logic. That the assessee should maintain a dispatch register for his letters as expected by the authorities below, is also abnormal expectation. That the assessee should get stamped receipt from the builder for the receipt of his letters, is equally quixotic proposition,” the bench said.
“In these circumstances, the insinuation that the assessee has submitted bogus and fake documents to support the case that reasonable efforts were made to find out a tenant for the vacant flat, is not sustainable in law. The expectation that despite his unarguably busy professional engagements commanding huge amount of money Shri Sachin Tendulkar should have embarked upon and displayed a more robust and exuberant expedition to find a tenant for his vacant flat by approaching other real estate brokers and keeping an infallible record thereof, is beyond normal conception,” the bench added.
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