Mr. Yogesh constructed a house in P.Y. 2017-18 with 3 independent units. During the P.Y. 2023-24, Unit - 1 (50% of floor area) is let out for…

Computation of taxable income of Mr. Yogesh for A.Y. 2024-25 Particulars Amount (₹) Amount (₹) Income from house property (A) Unit - 1 [50% of floor area - Let out] Gross Annual Value, higher of Expected rent - 1,39,000 [Higher of Municipal Value of 1,44,000 p.a. and Fair Rent of 1,49,000 p.a., but restricted to Standard Rent of 1,39,000 p.a.] Actual rent - 1,80,000 i.e., [₹ 20,000 x 10] less unrealized rent of January, 202420,000 1,80,000 Gross Annual Value 1,80,000 Less: Municipal taxes [50% of 30,000] 15,000 Net Annual Value 1,65,000 Less: Deductions from Net Annual Value (a) 30% of Net Annual Value 49,500 (b) Interest on loan [50% of 90,000] 45,000 94,500 70,500 Unit – 3 [25% of floor area – Self occupied] Net Annual Value - Less: Interest on loan [Not allowed as Mr. Yogesh is paying tax under section 115BAC.] - - 70,500 Profits and gains from business or profession (B) Business Income [without deducting expenditure of Unit - 2, 25% floor area used for business purposes] 2,40,000 Less: Expenditure in respect of Unit -2 - Municipal taxes [25% of 30,000] 7,500 - Repairs [25% of 7,000] 1,750 - Interest on loan [25% of 90,000] 22,500 - Ground rent [ 25% of 6,000] 1,500 - Fire Insurance premium [25% of 60,000] 15,000 48,250 1,91,750 Taxable Income (A+B) 2,62,250 Note: Alternatively, if as per income-tax returns, unrealised rent is deducted from GAV, then GAV would be - 2,00,000, being higher of unexpected rent of 1,39,000 and actual rent of 2,00,000. Thereafter, unrealized rent of 20,000 and municipal taxes of 15,000 would be deducted from GAV of 2,00,000 to arrive at the NAV of 1,65,000