2020 (9) TMI 1271

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.....2019 pertaining to assessment year 2016-17. 2. The issue raised is that the learned CIT(A) erred in sustaining the addition of rupees 3,40,459/- as deemed notional rent on unsold stock of flats. 3. Brief facts of the case are that the assessee is engaged in the business of Real Estate Developers & Construction and fifed its original return of income on 17.10.2016 declaring total loss at (-) Rs.....

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....e of the unsold units should not be assessed in its hands as income from house property. In response, the assessee submitted before the AO that it is in the business of real estate development activity and has never contemplated into leasing or renting the properties. Further assessee stated that he continues to hold the said flats for the purpose of business and thus are outside the preview of se....

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....rty, the provisions of Sec.22 will apply. In this regard, The AO placed reliance on the decision of Hon'ble Delhi High Court in the case of Ansal Housing Finance & Leasing co. Ltd,(2013) 354 ITR 180(DeI), and held that annual letting value of the unsold units is assessable in the hands of the assessee. Since, no details regarding rent prevalent in the area were available for working out the an....

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....n the case of Vegetables Product Ltd. (88 ITR 192), when two views are possible the issue should be decided in favour of the assessee. 8. Per contra learned departmental representative relied upon the orders of authorities below. 9. Upon careful consideration I note that the issue involved is the deemed notional rent upon unsold stock of flats of the builder and developer. There is a decision of....