Case Law Details
Case Name : CIT Vs Sane & Doshi Enterprises (Bombay High Court)
Related Assessment Year :
Courts :
All High Courts Bombay High Court
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Brief of the case:
Hon’ble HC have decided following questions of law in these bunch of appeals:
- Whether ITAT was justified in directing the AO to tax the rental income of Rs.45,57 lakhs as ‘income from house property’ and to allow deduction u/s 24 ignoring the fact that the income was received from the business asset of unsold flats shown as closing stock?
- Whether ITAT was justified in directing the AO to allow the claim of expenses of Rs.45 lak
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Issue of rental income unsold flats , of builders inventory, building not habitable, no potentially of earning rental income, needs to be discussed.
It is a myth that on taxing notional income of unsold inventory will induce builders not to hoard.
Supposedly, a proposed 20 stories building is stuck up at 16 the floor, in Approval / permission wrangles, and flats are unsold at many levels, OC not obtained, no water connection, construction incomplete, if Revenue demand tax.
May I expect some light on this issue.
Can any Tax guru, find a case of , where AO has made additions, in a builder’s project wherein, 1. Building is not in ahabitable condition, 2. OC not obtained 3. Water connection not obtained.
AO made additions, for notional rental income, u/s 23 and deduction u/s 24 (30℅).
How can additions be made, for NON habitable unsold flats, even though, building may be complete UpTo 90℅.
Notional rental income can be potential, only if flats habitable with OC.
Is ITAT/High Court judgement to quote