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CA.Rohan Surse (partner at J S Ranwadkar & Associates)     25 May 2021

Taxation of unrealised rent

Suppose ER is 144000, actual rent receivable is 120000 out of which 10000 is not realised.Hence, actual rent is 110000.Now we compare ER with AR to arrive at GAV.In this case it will be GAV will be ER i.e.144000. It means assessee is paying tax on ER.Now, when in subsequent years when unrealized rent iRs 10000. is received it is taxed.

My question is when tax is paid on ER , why tax is levied on unrealised rent received in subsequent year.Is there supportive case law to not levy tax in such case.ITR allows deduction of Unrealised rent from GAV but I don't think it is proper , as provisions do not allow. Kindly reply

 1 Replies

veerendar singh

veerendar singh (tax consultant)     25 May 2021

You should not have taken claim of unrealised rent.

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