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2019 (4) TMI 389 - AT - Income TaxTaxability of notional rental income regarding property held as stock-in-trade - unsold flats of the construction company - Income from house property - addition u/s 22 r.w.s. 23(4) - HELD THAT:- It is an undisputed fact that the assessee never let out the unsold flats held as stock-in-trade. It is the case of the AO that the provisions of sections 22 to 23 of the Act should be invoked for taxing the notional income on such flats. As perused grounds revolved around the provisions of sections 22 to 23 relating to the head of income i.e. income from house property. Further, it is an undisputed fact the provisions of section 23(5) of the Act was amended by the Finance Act, 2017 w.e.f. 01.04.2018 and, therefore, these provisions will not come to the rescue of the Assessing Officer for bringing the deemed income on such unsold flats to taxation under the head ‘income from house property’. In absence of enabling the provisions of the Income Tax Act, calculating the notional income in respect of the properties which were not rented out and rental income was never earned actually, the AO’s policy to tax such income is unsustainable in law in view of the various decisions cited in the preceding paragraphs of this order. - Decided in favour of assessee.
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