Expectations and assumptions are at the core of many concerns. It is the gap between the expectation and actuals that makes all the difference. If actuals are better than the expectations or estimates, it is considered positive. But if it is even a tad lower than expectations, it is considered as a negative factor. In Union Budget 2020-21, similar has been the case with Indian realty sector. It is a known fact that the Indian real estate industry has been going through tough times. And with higher contribution to India’s GDP growth and in relation to higher job creation (Skilled as well as unskilled) there was a lot expected to be announced for the realty sector. However, the Union Budget 2020-21 does not have much to cheer about for the realty sector. While there are few announcements, it is much lower than what the industry players had expected for. Let’s first take a look at few of the major expectations realty players had.Affordable Housing: Section 80IBA and 80EEA Extension ProvidedThe Section 80IBA allows for income tax deduction for individuals who have any gains or profits from the business of building and developing projects in the affordable housing segment. The amount of deduction with respect to income tax payable by such tax assessees are mentioned in Section 80 IBA of the Income Tax Act, 1961. The key reason for insertion of Section 80 IBA in the Income Tax Act is to incentivise the development of affordable housing for the builders and promoters of these projects. And as expected, the announcement has been made regarding the same. The Finance Minister has extended the time limit for approval of affordable housing project for availing deduction under section 80-IBA. Earlier it was prescribed that the project is approved by the competent authority during the period from June 1, 2016 to March 31, 2020. With more and more players entering the affordable housing segment (especially after looking at demand increasing in the segment), to incentivise building affordable housing to boost the supply of such houses, the period of approval of the project by the competent authority is proposed to be extended to March 31, 2021. CW opines that this will bring the much-needed breather for some projects, which have struggled to complete for various reasons. Further, such an extension would allow more number of projects getting registered and benefits would accrue in the next fiscal as well. We have seen that most of the organised players have entered the segment and resulted in improving sales volumes in the past few quarters. This amendment will take effect from April 1, 2021, and will, accordingly, apply in relation to the assessment year 2021-22 and subsequent assessment years.  In addition to this, another announcement has been made in terms of extending time limit for the sanctioning of loan for affordable housing for availing deduction under section 80EEA. The existing provisions of section 80EEA provide for a deduction in respect of interest on loan taken from any financial institution for acquisition of an affordable residential house property. The deduction allowed is up to Rs 150,000 (Subject to conditions). One of the conditions was that the loan has been sanctioned by the financial institution during the period from April 1, 2019, to March 31, 2020. This deduction is aimed to incentivise first time buyers to invest in residential house property whose stamp duty does not exceed Rs 4,500,000. In order to continue promoting purchase of affordable housing, the period of sanctioning of loan is been extended to March 31, 2021. Here, CW feels that this will incentivise the end user, which is the need of the hour. It is a known fact that the end-user demand is more sustainable and a consistent one. Further, with affordable housing being a consistently growing segment – the announcement has come as a breather for end-use buyers. As for the benefits to the developers, in the last few quarters, the affordable housing segment has been the volume driver for several developers even in the Tier-I and Tier-II cities. However, as per expectations, the limit of Rs 4,500,000 has not been increased. Safe harbour limit increased to 10 per cent under Section 43CAIn CW’s Budget expectations list, we had categorically mentioned about the expected amendment of Section 43CA of the Act. Sec43CA states that in case the sale rate of any property is below the circle rate of the state government for the levy of stamp duty, the rate as envisaged with the state government, will be the full value of the transaction and the stamp duty will be assessed at that rate. This section acted as a barrier to natural price correction and stalled projects as it has an impact on the home buyers, banks and other stakeholders and needs to be scrapped or amended to exempt primary sales or at least allow sales of 30 per cent below the circle rate. The Finance Minister in this budget announced the increase in safe harbour limit of 5 per cent under section 43CA, 50C and 56 of the Act to the level 10 per cent. We are of the opinion that, though it is lower than the expectations of 30 per cent as asked by the industry body, some relaxation has surely come in. We expect marginal relaxation for realty players on this front. Amendment for REIT and InvITs regarding listing on recognised stock exchangesUnder the Section 115UA, the total income of the trust, excluding capital gains income is charged at the maximum marginal rate. Further, the income by way of interest and rent, received by the business trust from a SPV is accorded pass through treatment, ie, there is no taxation of such interest or rental income in the hands of the trust and no withholding tax at the level of SPV.  However, the business trusts are also required to furnish return of income and adhere to other reporting requirements. The business trust means a trust registered as an InvIT or REIT under SEBI Act, 1992, and the units of which are required to be listed on a recognised stock exchange.  Representations have been received stating that the private unlisted InvITs should be given the same status as public listed InvITs with regards to tax treatments provided under the Act.  Therefore, the amendment has been made so as to do away with the requirement of the units of business trust to be listed on a recognised stock exchange. CW sees this as a positive news for few of the realty companies as tax treatment would be the same as compared to the listed ones.In conclusion While the NDA Government has been focusing on the Housing for All, not much has been talked about it in this Budget. Putting the figures in perspective, around 81 lakh houses were supposed to be delivered by 2022 and out of that 24 lakh houses have been delivered. We feel that the way the government is focusing on its target achievement, one can expect the reaming to be delivered by 2022.  Apart from this, there are a few indirect benefits as well. Announcements such as smart cities development with Rs 64.50 billion allocated towards the development of five smart cities, it also indicates towards rapid urbanisation and bodes well for the realty players. In addition to that, focus on road development, development of new airports and increased road network would mean better connectivity and development of new clusters of real estate development. Rather, factors such as electricity for all and piped water arrangement would result in better opportunities for the realty players. There are more of indirect benefits than the direct ones. However immediate revival plans or any financial assistance has not been provided. Overall, for real estate, there is not much cheer provided by the Union Budget 2020-21.