Meaning of “Annual value”

Case Name : M. Raghunandan v. Ito 

Citation : [1985] 11 itd 298 (mad. – Trib.) (Sb)

Court : Madras high court

Section : 22

Meaning : A basic concept in which section 22 differs from all other sections is in bringing a taxable period by reference to ‘annual value’. In other words, what is taxed under the act is only the annual value of the property. The expression ‘annual’ is the adjective of the word ‘year’. What is taxed under section 22 is, therefore, only the yearly income of the person derived from property. In other words, section 22 and the sections following, viz., Sections 23, 24, 25, 26 and 27, all are based on the concept of taxation of property income through ‘the annual value of property’. Legally and etymologically, annual value cannot mean monthly value, weekly value, daily or momentary value. Where property income is brought to tax and, therefore, if there is no ‘annual value’, there is no authority for taxing the property income in the act at all.