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2019 (9) TMI 1403 - AT - Income TaxIncome from House Property - Annual Letting Value of the unsold units lying as Stock in Trade - notional income by way of ALV in respect of the unsold flats cannot be taxed in the hands of the assessee - appellant is engaged in the business of real estate development and the unsold flats are held as Stock in Trade and not as Investments - 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 all the four grounds revolved around the provisions of sections 22 to 23 of the Act relating to the head of income i.e. income from house property. 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 AO 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 Assessing Officer’s policy to tax such income is unsustainable in law in view of the various decisions cited in the preceding paragraphs of this order. Accordingly, the grounds raised by the assessee are allowed.
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