Bollywood’s Nawab Pataudi gets a favourable order from the Income Tax Appellate Tribunal (ITAT) from paying taxes on notional rental income from a 6000 sq.ft vacant apartment. ITAT dismissed a significantly higher sum the Income Tax authorities had sought to tax.
Actor Saif Ali Khan filed a petition at ITAT that he could not rent out his luxurious apartment in Hicon Residency in Bandra due to certain defects in its construction that were not as per the approved plan for the flat.
Against a taxable rent of Rs 50 lakh determined by the Commissioner (Appeals), the ITAT accepted Rs 11.8 lakh the actor had offered to tax based on a valuation report. The bench, in its order dated August 21, stressed that Pataudi's plea before the tax tribunal "cannot be said to be spurious, vexatious, mere bluster or frivolous".
Under the I-T Act, a person owning two or more residential property, he/she can treat any one of them as “self-occupied” and exempt from tax. The other non-occupied property, even if not given out on rent, is supposed to have been let out and notional rent has to be offered to tax.