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TMI Blog2018 (10) TMI 1500X X X X Extracts X X X X X X X X Extracts X X X X ..... orollary, any income derived there-from would be Business Income and not Income from House Property. Resultantly, the impugned additions as confirmed by first appellate authority stand deleted. - I.T.A. No.7155/Mum/2016 - - - Dated:- 10-10-2018 - Shri Manoj Kumar Aggarwal, AM And Shri Ravish Sood, JM For the Assessee : J.P.Bairagra, Ld. AR For the Revenue : Manoj Kumar Singh, Ld. Sr. DR ORDER PER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. Aforesaid appeal by assessee for Assessment Year [AY] 2012-13 contest the order of Ld. Commissioner of Income-Tax (Appeals)-52 [CIT(A)], Mumbai, Appeal No.CIT(A)-52/DCIT-CC-4(2)/44/2015-16 dated 02/09/2016 by raising following ground of appeal:- On the facts and in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... projects being carried out by the assessee during impugned AY. The cost of construction of these units was reflected as ₹ 14.39 Crores. The Ld. AO, in terms of judgment of Hon ble Delhi High Court rendered in CIT Vs. Ansal Housing Finance Leasing Co. Ltd. [354 ITR 180], opined that notional rental value of the said units was chargeable under the head Income from House Property. The assessee defended its stand vide reply dated 19/03/2015. However, not convinced, Ld. AO computed notional rental value of these units @8.5% of cost of construction i.e. ₹ 14.39 Crores which came to ₹ 1.22 Crores. After providing statutory deduction of 30% as per Section 24(b), the net addition thus worked out came to ₹ 85.62 Lacs, wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [354 ITR 180]. 4.2 Proceeding further, we find that the Ld. AR has placed on record the recent judgment of this Tribunal rendered in the case of assessee s sister concern titled as ACIT Vs. Haware Construction Private Ltd. [ITA Nos.3321/Mum/2016 3172/Mum/2016 dated 31/08/2018] to submit that the issues under similar facts and circumstances, has been adjudicated in assessee s favor after considering the conflicting judicial precedents. For ease of reference, at the outset, we deem it appropriate to reproduce the relevant extract of the said decision as follows:- 4.1. As stated earlier, the assessee is a builder and developer and at the end of the year it had inventory of stock-in-trade which are not sold and lying vacant of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs Pvt.Ltd.(supra) is for the assessee, whereas the decision in Ansal Hsg. Finance Leasing Co. Ltd., (supra) is for the Revenue. The Hon ble Supreme Court in the case of CIT vs. Vegetable Products 88 ITR 192 (SC) has held that if two reasonable constructions of a taxing provisions are possible, that construction which favours the tax payer must be adopted. In view of the above position of law, we shall follow the decision in Neha Builders Pvt.Ltd.(supra). 4.5.1. We now come to the relevant provisions in the Act. The following sub-section (5) has been inserted after sub-section (4) of section 23 by the Finance Act, 2017, w.e.f. 01.04.2018: (5) Where the property consisting any building or land appurtenant thereto is held ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er rendered by Hon ble Gujarat High Court, the co-ordinate bench preferred to follow the view which was favorable to the assessee in terms of ratio of decision of Hon ble Apex Court rendered in CIT vs. Vegetable Products 88 ITR 192 (SC). Similar favorable view has been taken by this Tribunal rendered in Runwal Constructions vs. ACIT (ITA No.5408/Mum/2016 dated 22/02/2018) and Progressive Homes vs. ACIT (ITA No.5082/Mum/2016 dated 16/05/2018), the copies of which are on record. 4.3 Keeping in view the consistent stand of this Tribunal and respectfully following the same, we hold that if a immoveable property in the shape of flats / shops is held as stock-in-trade, then it becomes part of trading operations for the assessee and as a na ..... X X X X Extracts X X X X X X X X Extracts X X X X
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