2023 (4) TMI 1353 - AT - Income Tax

Income from house property - Determination of annual letting value in respect of unsold residential units lying with the builder assessee - applicability of provisions of section 23 - HELD THAT - In context of impugned AY 2014-15, we note that the Finance Act, 2017 introduced sub-section (5) to section 23 providing that where a property held as stock in trade is not let out during the year, its annual value, after a period of one year or as revised to two years, shall be considered for the purposes of inclusion under the head Income from House property . This amendment has been brought out w.e.f. 01-04-2018. Thus, this provision manifestly does not apply to the impugned AY 2014-15, therefore we are of the considered view that the impugned addition made and as sustained in the first appeal, is not called for, thus is directed to be deleted. Appeal of the assessee is allowed.

Summary

The appeal was against the addition of annual letting value for unsold residential units. The assessee, a construction firm, held unsold units as stock-in-trade. The ITAT Pune held that the provisions of section 23 did not apply for the assessment year 2014-15. The addition of Rs. 2,52,000 was deleted, and the appeal of the assessee was allowed.