SHARAD KANAIYALAL SHAH,AHMEDABAD vs. DCIT, CIRCLE 3(1)(1), AHMEDABAD

ITA 223/AHD/2026Status: DisposedITAT Ahmedabad12 August 2026AY 2017-187 pages
AI SummaryAllowed

What were the facts?

The assessee, a housing project developer, had unsold units. The Assessing Officer treated notional rental income from these units as taxable under Income from House Property. The CIT(A) partly allowed the appeal by directing a re-computation of this notional income.

What did the Tribunal hold?

The Tribunal held that unsold units forming part of a builder's stock-in-trade are occupied for business purposes and thus excluded from Section 22 of the Act. The addition made by the AO was not sustained due to the ad-hoc and unverified nature of the computation.

What were the issues?

Whether notional rental income from unsold housing units, held as stock-in-trade by a developer, is taxable under the head 'Income from House Property'. Whether the CIT(A)'s direction to re-compute the notional income without proper inquiry was justified.

Which sections of the Income-tax Act were involved?

Section 22,Section 23,Section 143(3),Section 234A,Section 234B,Section 234C,Section 234D,Section 270A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, B” BENCH, AHMEDABAD

Per Rahul Chaudhary, Judicial Member:

1.

The present appeal preferred by the Assessee is directed against the Order, dated 20/01/2026, passed by the Commissioner of Income Tax, Appeal ADD/JCIT (A)-10 Mumbai (hereinafter referred to as the 'CIT(A)'] whereby Learned CIT(A) had partly allowed the appeal against the Assessment Order, dated 14/12/2019, passed under Section 143 (3) of the Income Tax Act, 1961 [hereinafter referred to as the ‘Act'], for the Assessment Year 2017-2018].

ITA 223/AHD/2026 Assessment Year: 2017

The order continues below.

Read the full judgment

A free account opens 10 full judgments a month. Re-reading one you have already opened does not count again.

Create a free accountSign in

See plans and prices

The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.

More judgments on Section 22

All 635 judgments and leading authorities on Section 22 →

Recent GST High Court judgments

Search GST case law →