Per Deepak R. Shah Accountant Member. - This appeal by revenue is directed against the order of learned CIT(A)-VI, Bangalore dated 28-1-2002.

2. The assessee is an individual and is receiving property income and also share from partnership firms. The first issue in appeal is against determination of Annual Lettable Value (ALV) of property at Nungambakam, High Road, Chennai. The assessee declared the ALV at Rs. 60,000. The Assessing Officer held that the super built-up area of the property is 940 sq. feet. He adopted Rs. 10 per sq.ft. as monthly rent and, accordingly, ALV was determined. Learned CIT(A) held that the estimation by Assessing Officer is not based on any supporting evidence and hence ad hoc estimation is not maintainable.

2.1 Learned DR Shri B. Chattaraj submitted that Nungambakam High Road is a centrally located posh area of Chennai. The ALV declared by assessee is a meager sum of Rs. 60,000. Thus, the adoption of ALV at Rs. 10 per sq.ft. as monthly rent is justified.

2.2 Learned counsel for assessee on the other hand submitted that the property is not a let out property. The annual value adopted by Municipal Corporation is a sum of Rs. 10,975. The Municipal Corporation of Chennai is interested in levying property tax based on such valuation. When the valuation by tax authority itself is Rs. 10,975 and the assessee has adopted a sum of Rs. 60,000 as annual value, the same is to be adopted. No comparable case has been cited by Assessing Officer justifying the adoption of ALV at a sum of Rs. 1,12,800. Thus, the addition was rightly deleted by learned CIT(A).

2.3 On careful consideration of relevant facts, we are to agree with the finding of learned CIT(A). We are also in agreement with the submission by learned counsel for assessee. When the Municipal Corporation for the purpose of levy of municipal tax has adopted the letting value of Rs. 10,975, which has been valued at Rs. 60,000 by assessee, in our opinion, the same has to be accepted. Though the Assessing Officer has arrived at ALV by adopting Rs. 10 per sq.ft. as monthly rent, the same is not supported by any evidence. No comparable case has been cited. This ground is accordingly to be dismissed.

3. The next ground of appeal is against determination of ALV at Panganur, Chittor District, A.P.

3.1 The assessee is owner of office building measuring 7800 sq.ft. The property is leased to M/s. Vani Sugars and Industries Ltd., one of the assessee’s sister concern. The rent for the said property received by assessee is Rs. 9,625, which has been offered for taxation. The Assessing Officer concluded that the cost of land and building, as per Wealth-tax Return is Rs. 71,57,501. He accordingly concluded that rent is a meager sum. The Assessing Officer estimated the monthly lettable value at Rs. 3 per sq.ft. and computed the ALV at Rs. 2,80,8000 after reducing 20 percent for the repairs, the net ALV was adopted at Rs. 2,24,640. The difference between the value so arrived at and the ALV declared by assessee was added to the income. Learned CIT(A) held that the estimation of ALV by Assessing Officer is without any supporting evidence and is a purely ad hoc computation. He accordingly deleted the addition.

3.2 Learned DR submitted that the property is highly valued. The same is let out to one of the sister concern of assessee. Panganur is a town having Taluq Headquarters. Thus, the estimate of monthly lettable value at Rs. 3 per sq.ft. is justified and is to be adopted.

3.3 Learned counsel for assessee on the other hand relied upon the appellate order. He submitted that for arriving at the ALV, the cost of building is immaterial. What is to be found is what will be the rent available if such property is let out. As per the agreement with M/s. Vani Sugars and Industries Ltd., a Public Company, the same was fixed at Rs. 9,625. The valuation at Rs. 3 per sq.ft. is not supported by any other material. In the circumstances, the value based on the rent received is to be adopted.

3.4 On