Income from house property shall be taxable under .... Click here to view the full Article
<>Listing is seen to have been done as per the law. However, as
per case law- SC Judgment in Podar Cement Case, a critique of which has been
published on this website itself *, also adverted to off and on – ‘beneficial
owner’ , a special creature of the case law goes to add to the list.
* Cross refer:
https://taxguru.in/income-tax/law-and-vs-case-law-on-flats-a-critical-study.html
Jan 27, 2014 - Citations of some of those Articles published in law journals: ... how well those fit into the context of the Podar Cement case chosen for discussion herein: ..... The primary focus for analysis herein is on the SC RULING in re.
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https://taxguru.in/service.../deeming-a-legal-fiction-service-tax-a-case-study-part-ii.ht...
May 4, 2018 - Podar Cement Ltd. reported in (1992) 5 SCC 482 and Mysore .... study of the SC Judgment* as covered in extenso in the published article on ...
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“All about……”
Not so sure !
To say why / be precise:
1. There could, imaginably, be instances in which, assessment by local
authority – particularly, a village panchayat, being what it is, – of a
new building complex / rateable value (RV) of its ‘units’, be pending.
For owner of any such unit , in possession, but not let out, it appears, the options legitimately open are as indicated : –
To fill in the Sch. HP, disclosing the newly owned property, but claiming ‘nil’ income, for two reasons; namely that, –
RV not being known / ascertainable , hence computation of taxable income is a non-starter; AND
Relying on the ITAT (Del. Bench) decision in the case of, - Dr. Prabha Sanghi (so far as known, that is the only case law, hence
binding) , in which the applicable provision has been favorably
interpreted and held, in any case, no notional income is taxable.
Eminent Expert(s) in field practice, endowed with courage of
conviction, are invited to share, should they hold any thoughts / views ,
to seriously contradict the foregoing feedback-input, for the ‘common
good’ of the concerned among taxpayers ?
Tax on HP income never let out but had
remained vacant ?
*Also @
https://taxguru.in/wp-content/uploads/2012/12/Assistant-Commissioner-of-Income-tax-Vs-Dr.-Prabha-Sanghi-ITAT-Delhi.pdf
* ref. Para 13,14, ...
With spl. FOCUS >
"14. The third step as mentioned above as per section 23(1)(c)
in this case would be for I-A, Ring Road, Kilokri, New Delhi, in
respect of which the amount would be Rs.28,620/- or NIL
whichever is lower and, therefore, NIL, and in the case of A-6A,
Maharani Bagh, New Delhi, this would be Rs. 34,600/- or NIL
whichever is lower, thus NIL. Therefore, the third step would
reduce the ALV u/s 23(1) of the Act to nil and this is also now
well settled by various judgements* placed on record by the
appellant (sic assessee) viz., Kamal Mishra Vs. ITO 19 SOT 251
(Del), Premsudha Exports Ltd., Vs. ACT 110 TTJ 89 (Mum), Smt.
Shakuntala Devi Vs. DCIT 2012-TIOL-64-ITAT (Bang,)."
*TAIL Note:
Anyone concerned will have to, for taking a suitable stance in tax return, prudently search for, to ascertain, in order to ensure that , -the Revenue has not appealed against any of the cited and followed, or other like, itat decisions. If so, it could be presumed to have tacitly accepted the view, as binding.
Further, should due regard be had to the field reality that lately , by reason of the 'supply' being far exceeding the 'demand' for rented accommodation,owners/holders are driven to a hopelessly helpless situation.In the result, by and large,there being virtually no takers,owners /holders are in no mood, even if could afford, spend for minimum furnishing, as expected of by anyone looking for rentals.
To put it differently: Is it not time now for the government - central and state- to think of and update/amend the law / rules, to, as a matter of 'common sense' / 'natural justice', waive and do away with the levy of any IT /property tax in respect of such properties not let out /lying vacant for the whole of any FY ?!
Cross refer:Posts * sharing, in a like vein, thoughts/viewpoints against /on the impropriety of taxing a promoter in respect of Flats/Apartments in a building complex, remaining unsold, for similar reasons /in circumstances, beyond his control!
*
<>https://www.facebook.com/swaminathanv3/posts/1721487734594172 (To view&)
<>
https://www.facebook.com/swaminathanv3/posts/1721440811265531
& Copied:
I. "To provide relief to
individual purchasers, withholding tax requirements (section 194IA) imposed on
buyers to withhold 1% taxes on purchase of property, should be done away with
as the same leads to practical difficulties and undue hardships for individuals
purchasing property."
It is sad / a tragedy that the 1 %
TDS requirement has remained, nay obstinately left untouched, for years now
;despite it is logically faulty, -as discussed in detail, in published
articles*- 'without the authority of the law', in its critical and profound
sense.
NOTE: On, - 'taxation of notional
income', -
"Furthermore, taxation of
notional income on unsold inventory of developers has been a matter of concern
for the industry. While developers are unable to sell their completed stock,
they are also subject to tax on notional house property income on such unsold
stock. Even though a provision was introduced in last year’s budget where such
taxation would occur only where the inventory is held for a period of more than
1 year from the end of the year in which completion certificate has been
granted, the said provision should be entirely dropped in light of significant
slowdown in the sector."
no clue why so ?!)
>>>...................
To Focus ON >
KEY NOTE:
In
Tax Return FORM, there is no in-built mechanism to,-fill in particulars,
in case income from HP has to be compulsively claimed at a 'nil'
figure.
Reasons for/circumstances in which making such a claim will necessarily arise:
Rate able value not known/ascertainable;
if so, claim not possible, as-
no standard deduction (30% of 'annual value'), though admissible,could be claimed /allowed;
no 'property tax' levied/demanded /paid-
for which , if paid, a deduction is entitled to be claimed / allowed;
based on case law (supra),no notional income could be assessed /tax levied.
If
purchased out of home loan, though entitled to claim deduction for
interest,- also carry forward of resulting loss,- could not be claimed.
On
these grounds,by any logic, failure to report income from HP could not
be faulted, even technically.And, no consequence of interest or penalty
can follow; if Revenue were to take a different view, it could be
contested, successfully !
On
the proposition (of law)- absence of mechanism, hence no taxation,- for
support,could be pressed, and reliance placed on SC Judgment in the
land mark B.C.Srinivasa Setty's case*
* Citation- Palkhivala's Text Book
(For clarity, if needed,- look up the Ready Reckoner (AY 2018-19) pg. 102, 103,104)
