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TMI Blog2025 (2) TMI 1082X X X X Extracts X X X X X X X X Extracts X X X X ..... hereinafter 'the ld. CIT(A)'] pertaining to AY 2015-16. 2. These cross-appeals were heard together and are disposed off by this common order for the sake of convenience and brevity. 3. The sum and substance of the grievance of the assessee is that the ld. CIT(A) erred in confirming the addition of Rs. 10,59,48,467/- under the head income from house property as per Section 22 of the Act. 4. Representatives were heard at length. Case records carefully perused and the judicial decisions relied upon by the representatives duly considered. 5. Briefly stated, the facts of the case are that the assessee company is engaged in real-estate business. The return for the year under consideration was filed on 29/09/2015, disclosing loss of Rs. 72,80, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ck-in-trade and the charging provisions of Section 22 of the Act specifically gives exemption from determination of actual value of the property which is used for the purpose of any business or profession carried on by the assessee. Reliance was placed on various decisions discussed in the assessment order. But the claim of the assessee did not find any favour with the AO who concluded as under:- "2.10. In order to bring to tax, the income under the head income from house property in respect of the unsold flats lying with the assessee, annual letting value (ALV) need to be determined. Taking into consideration interest rate on Bank FD of 8% during period under consideration, the ALV of the same works out to Rs. 15,13,54,952/- (1891936905 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g activities. It argues that flats are held as part of its inventory of stock-in-trade, and are not let out. The further argument is that unlike in the other instances, where such builders let out flats, here there is no letting out and that deemed income - which is the basis for assessment under the ALV method, should not be attributed. This Court is of the opinion that the argument, though attractive cannot be accepted. As repeatedly held, in East India, Housing & Land Development Trust's case (supra) Sultan Bros's case (supra) and Karan Pura Development Co. Ltd.'s case (supra) the levy of income tax in the case of one holding house property is premised not on whether the assessee carries on business, as landlord, but on the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property till it is sold, is concerned, the Court does not find any merit in this submission. While there can be no quarrel with the proposition that "occupation" can be synonymous with physical possession, in law, when Parliament intended a property occupied by one who is carrying on business, to be exempted from the levy of income tax was that such property should be used for the purpose of business. The intention of the lawmakers, in other words, was that occupation of one's own property, in the course of business, and for the purpose of business, i.e. an active use of the property, (instead of mere passive possession) qualifies as "own" occupation for business purpose. This contention is, therefore, rejected. Thus, this question is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act was applicability of the provisions of Section 22 of the Act in respect of finished unsold inventory of the assessee and deciding this issue the ld. Pr. CIT cancelled the assessment order dated 29/12/2017 and restored the matter to the AO for fresh examination of the issue. The Hon'ble High Court of Bombay in the case of PCIT vs. Royal Western India Turf Club Ltd. [2019] 103 taxmann.com 13 (Bombay) had the occasion to consider the following substantial question of law:- "(i). Whether on the facts and in the circumstances of the case and in law, the Tribunal is justified in holding that the addition towards entrance fees and annual subscription made by the Assessing Officer in the proceedings under Section 143(3) read with Section 263 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t order. However, when the Commissioner, as in the present case, requires the Assessing Officer to carry out inquiries with respect to specified issues, the jurisdiction of the Assessing Officer to pass fresh order must be confined to such issues, failing which we would be giving the power to the Assessing Officer to make reassessment. 6. Gujarat High Court in similar background in the case of CIT v. D.N. Dosani [2006] 153 Taxman 13/280 ITR 275 has observed as under:- "12. The scheme of the Act has provided different powers to different authorities and these are required to be exercised after satisfying the pre-requisite conditions and jurisdictional facts. The assessing officer can disturb/re-open a finalized assessment by invoking his ..... X X X X Extracts X X X X X X X X Extracts X X X X
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