TaxTMI 
TaxTMI 
2021 (10) TMI 1476
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....of appeal: "1. The Hon'ble CIT (Appeals)-II, was not justified in confirming in the addition made by learned ACIT for Rs. 21,42,000/- on account of Deemed Income from House Property of the Act. 2. The appellant reserves the right to add, alter, amend or withdraw any ground of appeal." 2. The assessee vide application filed on 09.06.2021 has raised following additional grounds of appeal: "First Additional Grounds of Appeal: "The Ld. Income-tax officer has erred in reopening of the case u/s 147 of the Income-tax Act, 1961 by not obtaining required prior approval from the prescribed authority. Second Additional Grounds of Appeal: "The Ld. Income-tax officer has erred in reopening of the ....
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....t of stock-in- trade. The ld. AR submits that there is no variation of facts, except various number of unsold units i.e. shops / flats. 5. On the other hand, the ld. Senior Departmental Representative (ld. Sr. DR) for the Revenue after going through the decision of the Tribunal in assessee's own case for the A.Y. 2011-12 and grounds of appeal raised by the assessee relied on the order of ld. CIT(A). 6. We have considered the rival submission of the parties and have gone through the orders of Lower Authorities. We find that a similar set of facts in assessee's own case for the A.Y. 2011-12, the Co-ordinate Bench of Tribunal by considering the decision of Jurisdictional High Court in Neha Builders Pvt. Ltd.(supra) passed the following o....
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....e property, but if the property is used as 'stock-in- trade', then the said property would become or partake the character of the stock, and any income derived from the stock, would be 'income' from the business, and not income from the property. If the business of the assessee is to construct the property and sell it or to construct and let out the same, then that would be the 'business' and the business stocks, which may include movable and immovable, would be taken to be 'stock-in-trade', otherwise, it is to be seen that there was distinction between the 'income from property." 9. From the statement of the assessee, it would clearly appear that it was treating the property as 'stock-in-trade'. Not only this, it will also be clea....
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.... On the other hand, ld. DR relied on the order of Hon'ble Delhi High Court in the case of Ansal Housing Finance & Leasing Co. Ltd., 354 ITR 180 (Delhi) in support of the proposition that even in respect of unsold flats by the developer is liable to be taxed as income from house property. 5. We have considered rival contentions and perused the record. The issue under consideration has been restored by the CIT(A) to the file of AO to compute the annual value. Recently the Hon'ble Supreme Court in the case of M/s Chennai Properties & Investments Ltd. Vs. CIT, reported in (2015) 42 SCD 651, vide judgment dated 9-4-2015 has held that where assessee company engaged in the activity of letting out properties and the rental income r....
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....he flats u/s. 23 of the I.T.Act. 10. In the case on hand before us it is an undisputed fact that both assessee have treated the unsold flats as stock in trade in the books of account and the flats sold by them were assessed under the head 'income from business'. Thus, respectfully following the above said decisions we hold that the unsold flats which are stock in trade when they were sold they are assessable under the head 'income from business' when they are sold and therefore the AO is not correct in bringing to tax notional annual letting value in respect of those unsold flats under the head 'income from house property.' Thus, we direct the AO to delete the addition made under Section 23 of the Act as income from house property.....