No notional income for house property held as stock-in-trade w.e.f 01.04.2017

By | February 2, 2017
(Last Updated On: February 2, 2017)

Income for house property held as stock-in-trade

Summary : As per Finance Bill 2017 w.e.f 01.04.2017  i.e FY 2017-18 (AY 2018-19) where the house property consisting of any building and land appurtenant thereto is held as stock-in-trade and the property or any part of the property is not let during the whole or any part of the previous year, the annual value of such property or part of the property, for the period upto one year from the end of the financial year in which the certificate of completion of construction of the property is obtained from the competent authority, shall be taken to be nil


No notional income for house property held as stock-in-trade

Clause  12 of Finance Bill 2017  seeks to amend section 23 of the Income-tax Act relating to annual value how determined.

Section 23 of the Act provides for the manner of determination of annual value of house property. Considering the business exigencies in case of real estate developers,It is proposed to insert a new sub-section (5) in the said section 23  so as to provide that where the house property consisting of any building and land appurtenant thereto is held as stock-in-trade and the property or any part of the property is not let during the whole or any part of the previous year, the annual value of such property or part of the property, for the period upto one year from the end of the financial year in which the certificate of completion of construction of the property is obtained from the competent authority, shall be taken to be nil

This amendment will take effect from 1st April, 2018 and will, accordingly apply in relation to assessment year 2018-19 and subsequent years.

Relevant Extract of Section 23

In section 23 of the Income-tax Act, after sub-section (4), the following sub-section shall be inserted with effect from the 1st day of April, 2018, namely:___

“(5) Where the property consisting of any building or land appurtenant thereto is held as stock-in- trade and the property or any part of the property is not let during the whole or any part of the previous year, the annual value of such property or part of the property, for the period up to one year from the end of the financial year in which the certificate of completion of construction of the property is obtained from the competent authority, shall be taken to be nil.”.

Related Post on Budget 2017-18

Budget Speech 2017-18 -Download /Print

Finance Bill 2017 -Download /Print -Budget 2017-18

Memorandum Explaining Provisions in Finance Bill 2017

Updates  on Union Budget 2017-18

 

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