Ankit Private Limited in its return of income filed for A.Y. 2019-20, has claimed a sum of ₹40,000 as a deduction on account of payments made for stamp duty and registration charges of the lease deed from the income show

Section 23 of the Income Tax Act, 1961 stipulates that in determination of net annual value of the let-out house property, the deduction allowed is of the municipal taxes paid by the owner. Once the net annual value is determined, the deductions which are admissible are specified in section 24 namely statutory deduction @ 30% of the net annual value and deduction in respect of interest on borrowed capital taken for the purpose of acquiring, constructing, renewing or repairing the house property. Amount spent towards stamp duty for drawing up the lease deed and for the registration charges are not to be allowed as deduction in determining the net annual value of the house property under any of the sections either 23 or 24 of the Income tax Act, 1961. Therefore, the action of the Assessing Officer in disallowing the deduction in respect of stamp duty and registration charges is correct.