**Case Scenario -I** Reenu, a resident individual aged 48 years, owns 2 flats (A and B) in Hyderabad. She lives in flat A and gave flat B to her in-laws for their residential purposes. She does not charge any rent from them. In the month of April 2024, she entered into an agreement to buy flat C from a builder in the same area as her other flats are situated. In the month of September 2024, she took possession of flat C and started spending her weekends there after paying a token amount of ₹ 11,000 to the builder. However, flat C is still not registered in her name. All the three flats are identical in size and other aspects. She had one more flat D which was let out at a monthly rent of ₹ 45,000 to Mr. Shubh during the financial year 2021-22 (from 01.04.2021 to 31.03.2022). Mr. Shubh did not pay rent for 3 months. Reenu sold the flat on 31.03.2024. She owned 5,000 shares of PQR Ltd. (listed on a recognised stock exchange in India), an Indian company which were acquired on 01.02.2022 for ₹180 per share. On 01.01.2025, the company bought 2,000 shares back from her and paid ₹420 per share to Reenu. Based on the above facts, answer the following multiple choice questions 1 to 3:
Sub-questions (3)
Which of the following statements is correct as far as the taxability of income from house property is concerned?
(A) Any two flats (of her choice) will be treated as self-occupied whereas the third flat will be treated as deemed to be let out.
(B) One flat (of her choice) will be treated as self-occupied whereas the other two flats will be treated as deemed to be let out.
(C) Flat A will be treated as self-occupied, flat B will be treated as deemed to be let out and flat C will not have any impact on her income as the flat is not yet registered in her name.
(D) All three flats will be treated as self-occupied.
Assume Shubh pays the arrear rent to Reenu on 28th June 2024. What shall be the treatment of such rent received if she had to spend ₹ 5,000 for such collection?
(A) ₹1,30,000 shall be taxable in the hands of Reenu as income from other sources in the P.Y. 2024-25 as she is not the owner of the flat anymore.
(B) Nothing shall be taxable in the hands of Reenu as she is not the owner of the flat anymore.
(C) 94,500 shall be taxable in the hands of Reenu as income from house property in the P.Y. 2024-25, even if she is not the owner of the flat anymore.
(D) 89,500 shall be taxable in the hands of Reenu as income from house property in the P.Y. 2024-25, even if she is not the owner of the flat anymore.
Which of the following statements is correct as far as the taxability of buy-back of shares by PQR Ltd. is concerned? (Cost Inflation Index: F.Y. 2021-22:317; F.Y. 2024-25:363)
(A) 8,40,000 will be treated as deemed dividend in the hands of Reenu.
(B) PQR Ltd. shall be liable to pay ₹ 1,95,686 as additional income-tax and the income arising in respect of such buy-back shall be exempt in the hands of Reenu.
(C) ₹ 4,80,000 will be treated as long-term capital gains in the hands of Reenu and it will be taxable at the rate of 12.5% after deducting 1,25,000 from the LTCG.
(D) ₹4,80,000 will be treated as deemed dividend in the hands of Reenu.