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Rule 4 of Income Tax Rules 1962: Unrealised Rent

Rule 4 - Unrealised Rent

For the purposes of the Explanation below sub-section (1) of section 23, the amount of rent which the owner cannot realise shall be equal to the amount of rent payable but not paid by a tenant of the assessee and so proved to be lost and irrecoverable where,—

(a) the tenancy is bona fide;
(b) the defaulting tenant has vacated, or steps have been taken to compel him to vacate the property;
(c) the defaulting tenant is not in occupation of any other property of the assessee;
(d) the assessee has taken all reasonable steps to institute legal proceedings for the recovery of the unpaid rent or satisfies the Assessing Officer that legal proceedings would be useless.

Extra Notes for Readers:

- Rule 4 was substituted by the Income Tax (Eighth Amendment) Rules, 2001, w.e.f. 1-4-2002.

Reference/Source: Check at Income Tax site for latest version of the Rules - link

This page was last updated on 17th October 2016.

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