PARAMJIT SINGH MOHANSINGH OBHAN ,MUMBAI vs. ASSTT. COMMISSIONER OF INCOME TAX CIRCLE 28(2), MUMBAI

ITA 4863/MUM/2025Status: DisposedITAT Mumbai10 November 2025AY 2017-18Bench: SHRI OM PRAKASH KANT (Accountant Member), SHRI. ANIKESH BANERJEE (Judicial Member)1 pages
AI SummaryPartly Allowed

What did the Tribunal hold?

The Tribunal held that deemed rent on unsold stock-in-trade should be computed based on Municipal Rateable Value (MRV), not an ad-hoc estimate. It also deleted the addition on conversion of stock-in-trade to capital asset as the relevant section was not applicable.

What were the facts?

The assessee, a real estate developer, declared a certain income. The Assessing Officer made additions for deemed rent on unsold flats and profit on capitalization of shops. The CIT(A) deleted one addition but upheld others.

What were the issues?

Whether deemed rent on unsold stock-in-trade is taxable under 'Income from House Property' and how it should be computed. Whether conversion of stock-in-trade to capital asset attracts tax in the given assessment year.

Which sections of the Income-tax Act were involved?

Section 23(5),Section 28(via)

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Income Tax Appellate Tribunal, MUMBAI BENCH “C”, MUMBAI

Before: SHRI OM PRAKASH KANTT & SHRI. ANIKESH BANERJEE

For Appellant: Shri Ashok J Patel
For Respondent: Shri Virabhadra Mahajan (SR.DR.)
Hearing: 16/10/2025Pronounced: 10/11/2025

Per Anikesh Banerjee (JM): The instant appeal of the assessee was filed against the order of the Learned Commissioner of Income-tax (Appeal) ADDL / JCIT(A)-1, Vishakhapatnam [for brevity, ‘Ld.CIT(A)’] passed under section 250 of the Income-tax Act, 1961 (in short, ‘the Act’) for assessment year 2017-18, date of order 04/06/2025. The impugned order emanated from the order of the Ld. Assistant Commissioner of Income-tax,

2 Paramjit Singh Mohansingh Obhan Circle 28(2), Mumbai (for brevity, the “Ld.AO”)

The order continues below.

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