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2019 (4) TMI 2016 - AT - Income TaxIncome from house Property u/s 22 - ALV of the unsold units which constitutes stock in trade - adding the Annual Letting Value (ALV) of unsold unit under the head Income from House Property - scope of amendment - AO estimating the deemed rental income of the assessee in respect of unsold units and after grating statutory deduction of 30% treated the remaining as ‘ income of house property’ - HELD THAT:- As decided in own case [2018 (10) TMI 1910 - ITAT MUMBAI] section 23 has been amended w.e.f. AY 2018-19 (FY 2017-18) provided that if the assessee is holding any house property as his stock-in-trade which is not let out for the whole or part of the year, the annual value of such property will be considered as Nil for a period up to one year from the end of the financial year in which a completion certificate is obtained from the competent authority. As the assessee is in the business of real estate development. The issue of taxability is with regard to unsold flats/units held by the appellant under the head ‘Closing Inventories’. The AY is 2012-13. In view of the insertion of sub-section (5) in section 23 by the Finance Act, 2017, w.e.f. 01.04.2018 narrated hereinbefore, we set aside the order of the Ld. CIT(A). AO was not justified in bringing the unsold flat / units under income from house property. In the result the grounds of appeal raised by the assessee are allowed. Addition of interest expenditure under section 36(i)(iii) - assessee failed to prove that the interest paid has been utilized wholly and exclusively for the business purpose - HELD THAT:- Considering the decision of Tribunal in assessee’s own case for earlier year [2018 (10) TMI 1910 - ITAT MUMBAI] and the facts that the ld CIT(A) has nor recorded its satisfaction that that he has examined the facts and the books of accounts of the assessee if the assertion of the assessee that out of ₹ 151.06 Crore a sum of ₹ 50.74 Crore was business advances, ₹ 80.78 Crore was advanced to subsidiary and ₹ 6.37 to associate concerns or when the interest free loans of ₹ 86.95 Crore was received by the assessee. Therefore, the grounds of appeal raised by the revenue are also restored back to the file of assessing officer to verify the facts and pass the order in accordance with law.Appeal of revenue is allowed for statistical purpose.
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