Ansal Housing Ltd (Formerly Known As Ansalhousing And Construction Ltd v. Deputy Commissioner Of Income Tax

$~74 *IN THE HIGH COURT OF DELHI AT NEW DELHI +ITA 553/2024 ANSAL HOUSING LTD (FORMERLY KNOWN AS ANSALHOUSING AND CONSTRUCTION LTD) .....Appellant Through:Ms Kavita Jha, Sr Advocate with MrVaibhav Kulkarni andMr AkashShukla, Advocates. versus DEPUTY COMMISSIONER OF INCOME TAX .....Respondent Through:Mr Sanjay Kumar, SSC. CORAM:HON'BLE MR. JUSTICE VIBHU BAKHRUHON'BLE MS. JUSTICE SWARANA KANTA SHARMA O R D E R%14.11.2024 1.The appellant (hereafter the assessee) has filed the present appealimpugning an order dated 26.07.2024 passed by the learned Income TaxAppellate Tribunal (hereafter the ITAT) in ITA No. 2731/Del/2010 inrespect of the assessment year (AY) 2007-08 rendered in the appealpreferred by the Revenue against the order dated 30.03.2010 passed by thelearned Commissioner of Income Tax (Appeal)-1 [hereafter the CIT(A)]. 2.The Revenue had challenged the decision of the learned CIT(A) indeleting an addition of ₹58,09,780/- made on account of gross notional Annual Letting Value (ALV) in respect of unsold spaces / flats and treatingthe same as income from house property. 3.The assessee is engaged in the development of real estate and contended that the said vacant flats/spaces held by it were stock-in-trade andtherefore, Section 22 of the Income Tax Act, 1961 (hereafter the Act) wasnot applicable. According to the assessee, its income is required to beassessed under the head ‘profits and gains of business or profession’ and notunder the head of ‘income from house property’. The said contention wasaccepted by the learned CIT(A). The relevant extract of the order dated30.03.2010 is set out below:- “10.After going through the grounds of appeal aswell as the order of the appellate Authorities, I amof the view that as the business of the appellantcompany was construction and sale of immovableproperty, the income arising from the unsold spaces/ flats could only be taxed under the head businessincome and it was not open to the Assessing Officerto tax the notional value under the head incomefrom house property in respect of flats / spaceslying in the closing stock of the company. It isnoticed that the A.O. has based the additions on theground that department has not accepted theappellate decisions of the higher authorities and thatthe matter is pending before the Hon'ble High Courtof Delhi. Following the decisions of the ITAT andmy predecessor CIT (A)- l in the case of appellantfor the earlier assessment years the addition of Rs.82,99,685/- made by the Assessing Officer isdeleted.” 4.However, the learned ITAT did not concur with the said view.Notwithstanding, that the assessee held immovable property as a part of thestock-in-trade, the ALV was chargeable to tax under the head of ‘incomefrom house property’. 5.Concededly, this issue stands concluded in favour of the Revenue bythis Court in the assessee’s own case in an earlier assessment year - Ansal Housing & Construction Limited v. Assistant Commissioner of IncomeTax: [2018] 89 taxmann.com 238 (Delhi). 6.In view of the above, no substantial question of law arises in thepresent appeal. The same is, accordingly, dismissed. VIBHU BAKHRU, J NOVEMBER 14, 2024M SWARANA KANTA SHARMA, J Click here to check corrigendum, if any