Ansal Housing Limited Vs ACIT (ITAT Delhi)
Delhi ITAT Upholds Tax on Notional Rent of Unsold Flats Held as Stock-in-Trade Following Delhi High Court Ruling
The Delhi ITAT dismissed the appeals of Ansal Housing Ltd. and upheld the addition of notional annual letting value (ALV) of unsold flats and commercial units held as stock-in-trade under the head “Income from House Property.” The Tribunal noted that the issue was no longer res integra, as it stood squarely covered against the assessee by the Delhi High Court’s decision in CIT v. Ansal Housing Finance & Leasing Co. Ltd., and accordingly sustained the action of the lower authorities.
As regards the addition of ₹16.19 crore made under section 43CA, the assessee submitted that the issue had already been resolved through a rectification order passed under section 154 read with section 250, granting the necessary relief. Since this submission remained uncontroverted by the Revenue, the Tribunal treated the ground as not pressed and dismissed it accordingly.
Following the same reasoning, the Tribunal dismissed the connected appeal for the subsequent assessment year as well. Thus, both appeals of the assessee were dismissed
Cases Discussed
- CIT vs Ansal Housing Finance of Leasing Company Limited (Delhi HC), (2013) 213 com 143(Del)
FULL TEXT OF THE ORDER OF ITAT DELHI
These assessee’s twin appeals ITA No. 888 & 889/Del/2026 for assessment years 1997-18 & 1998-99, arise against the Commissioner of Income Tax/National Faceless Appeal Centre (for short, “the CIT(A)/NFAC”), Delhi’s DINs & orders No. ITBA/NFAC/S/250/2025-26/1083341052(1) & ITBA/NFAC/S/ 250/2025-26 / 1083341052(1), both dated 05.12.2025, involving proceedings u/s 143(3) of the Income Tax Act, 1961; hereinafter referred to as, “the Act”.
Heard both the parties. Case files perused.
2. The assessee’s ‘lead’ appeal ITA No. 888/Del/2026 herein for A.Y. 2015-16 raises the following substantive grounds:
“1. That on the law, facts and in the circumstances of the case, the Learned Commissioner of Income-tax (A) has erred in upholding the addition of Rs.63,44,502/- made by AO under the head ‘Income from House Property’ on account of notional annual letting value in respect of unsold vacant flats and commercial space held as stock in trade by the company.
1.1 That on the law, facts and in the circumstances of the case The Ld. Commissioner of Income Tax (A) has erred in upholding action of Assessing Officer in taxing alleged notional ALV of flats and spaces lying unsold in closing stock under the head ‘Income From House Property’ and also taxing the same closing stock under the head ‘Profit and Gain of Business or Profession’ in the same assessment year. This results in multiplicity of taxation on the assessee.
1.2 That on the law, facts and in the circumstances of the case The Ld. Commissioner of Income Tax (A) has erred in upholding action of Assessing Officer in taxing notional ALV of flats and spaces lying unsold in closing stock under the head ‘Income From House Property’ on the basis of self-occupation of these assets, even though these assets are not habitable and after taking possession the owner have to do lot of things to make a particular unit habitable.
1.3 That on the law, facts and in the circumstances of the case The Ld. Commissioner of Income Tax (A) has erred in upholding action of Assessing Officer in taxing notional ALV of farm land lying unsold in closing stock under the head ‘Income From House Property’ without taking into consideration direction of Hon’ble ITAT New Delhi in ITA No. 1254/ Del/ 2009. The copy of order of Hon’ble ITAT was duly submitted before Hon’ble Commissioner of Income Tax (Appeal).
2. That on the law, facts and in the circumstances of the case The Ld. Commissioner of Income Tax (A) has erred in upholding addition of Rs.16,18,94,009/- made u/s 43CA of Income Tax Act 1961, and passing a cryptic order without taking into consideration the written submission and DVO valuation reports submitted during the course of hearing.
2.1 That on the law, facts and in the circumstances of the case The Ld. Commissioner of Income Tax (A) has erred in not allowing benefit of 10% tolerance limit inserted by the Finance Act, 2020, to the value of properties where difference in value of DVO valuation and actual consideration received is less than 10%, as has been allowed by the Hon’ble ITAT in the case of assessee in ITA No. 6626/Del/2019 for A.Y. 2014-15.
3. That all the above grounds and sub-grounds have to be read conjunctively and also independent of each other.
4. That the above ground(s) of appeal are to be considered separately and without prejudice to one another.
5. That the appellant assessee craves, leaves to add, alter, amend, substitute, withdraw or forego any of the ground(s) of appeal before or at the time of hearing.
6. That the order of Learned CIT (A) is bad in law and wrong on facts of the case and is in violation of the principles of natural justice, as has been passed without taking into consideration the written submission of the assessee and without providing reasonable opportunity to the appellant assessee to meet the merits of its case.”
3. Learned counsel next submits very fairly that so far as the assessee’s above former substantive ground relating to assessment of its notional annual leading value of unsold stock in trade as income from “house” property is concerned, the same is admittedly no more res Integra since decided in the Revenue’s favour in CIT vs Ansal Housing Finance of Leasing Company Limited (2013) 213 com 143(Del). We appreciate the assessee’s fair stand and uphold the learned lower authorities’ action under challenge in very terms therefore.
4. Next comes the latter issue of the assessee’s section 43CA addition amounting to Rs. 16,18,94,009/- made in the assessment order and upheld in the lower appellate discussion. Learned counsel herein places on record the CIT(A)/NFAC’s recent section 154 r.w.s 250 order dated 23.03.2026 that once the relief herein already stands granted, it not more wishes to press for the same which has gone unrebutted from the Revenue side. We thus reject the instant latter ground as not pressed. Its instant “lead” appeal ITA No. 888/Del/2026 is dismissed.
Same order follow in the assessee’s appeal ITA No. 889/Del/2026 since raising identical twin issues.
5. These assessee’s twin appeals ITA No. 888 & 889/Del/2026 are dismissed in above terms. A copy of this common order be placed in the respective case files.
Order Pronounced in the Open Court on 20.07.2026 .
