urgent query on house property..pls help

situation- PROPERTY WHCIH IS LET OUT BUT REMAINED VACANT DURING PART OF PREVIOUS YEAR...

QUESTION--- F.R.V 1200 P.M

                          LET OUT FOR RS 1000 P.M


                          VACANCY PERIOD- 5 MONTHS


WHAT WILL BE ITS N.A.V

 

REGARDS

AAYUSH BANSAL

Replies (4)

 

The expected rent receivable from the property is Rs.14400/-(1200 p.m x 12)

 

Actual rent received is Rs. 7000/- (1000 x 7)

 

Had their been no vacacy, rent recieved would be Rs.12000(1000 x 12).

 

Now let us sift the section.

 

Sec.23(1)(c) says that in case of vacancy, Annual value shall be actual rent recieved if due to such vacancy, the Actual rent received is less than fair value.

That means, we will take actual rent recieved in case it is lesser than expected rent only if it is so less because of such vacancy and no other reason.

 

In above case, even if vacancy period is not considered, still it is coming out to be less than fair value. That is vacancy didn't cause the Actual rent recived to fall short of Fair value.

 

Hence, Sec.23(1)(c) shall not apply and Sec.23(1)(a) shall apply and Annual value shall be Rs.14,400/-

 

[In sum books like V.K. Singhania, I found on this issue that Annual value is calculated by deducting the vacancy period rent from the expected value so taken. I.e. in this case, it would have taken annual value to be Rs.9400/- (14400/--5000/-). And i posted similar topic several times ending up without any reply.]

dear sir,

    so wat will be the n.a.v 14400 or 9400

  or both are correct...

basically i am preparing for pcc so for papers what should be the ans...

in ur case, GAV= reasonable expected rent(i.e 1200p.m * 12) less vacant period(i.e 1200 p.m. * 5)

U can wait for more comments.!!!!!!!

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