File IT return as per PAN address

SC Vasudeva

Q. I have been allotted Permanent Account Number from Panchkula (Haryana) and at present I am working in Ludhiana. My query is where I should file my Income Tax return as per the Income Tax Act

— Amit Kumar 

A. The return of income will have to be filed on the basis of your permanent address which had been indicated in the application for the allotment of Permanent Account Number. It seems your permanent address is that of Panchkula and if it is so, the return should be filed at Panchkula.

Q. I am a Central Government employee. I would like to know whether “DA” has to be included for the definition of salary for allowing HRA rebate as per rule. Some of my colleagues are of the opinion that “DA” is not included in the definition of salary for calculating HRA rebate because DA is not included in the pensionary benefit for superannuation calculation. But we are getting “DA” on retirement as pensionary benefit. I’m really confused. Please help me.?

— Lal Singh

A. Rule 2A of the Income Tax Rules, 1962, prescribes the limit for the exemption of House Rent Allowance (HRA). The said rule provides that for the purposes of computing HRA exemption, salary shall have the meaning as specified in Clause (H) of Rule 2 of part A of the Fourth Schedule to the Income Tax, 1961 (the Act). According to Rule 2(H) salary includes dearness allowance if the terms of employment so provide, but excludes all other allowances and perquisites. You will have to therefore ascertain whether in your case dearness allowance is included as part of the salary according to the terms of employment. If it is so included, you will be able to claim the exemption of house rent allowance which would be computed after taking into account DA as part of the salary.

Q. I have let out a commercial property which is situated in a mall. Please let me know what are the deductions available against such income for the purpose of computing taxable income?

— Raj Narain

A. The Act provides that the annual value of a house property consisting of any buildings or lands appurtenant thereto of which the assessee is owner shall be chargeable to income tax under the head “Income from house property”. The annual value of any property is deemed to be the sum for which the property might reasonably be expected to let from year to year or where the property is let and the actual rent received or receivable by the owner in respect thereof is in excess of the sum for which the property might reasonably be expected to let from year to year, the amount so received or receivable. For computing such annual value the taxes levied by the local authority which have actually been paid during the year are deductible. The following other deductions are allowable from the annual value so computed:

a) 30 per cent of the annual value to cover repairs and maintenance to the property.

b) The interest paid or payable on money borrowed for acquisition, construction or renovation of property.