Section 54F relief may cover multiple flats in one development deal, and fresh claims can be heard on appeal.

Section 54F relief in a joint development agreement can extend to multiple flats received as part of one residential development transaction, so the assessee was entitled to exemption for all three flats received against the transfer. The Tribunal also applied the rule that the bar on a fresh claim without a revised return binds the Assessing Officer, but does not prevent the appellate authority from entertaining a legitimate claim raised in appeal, so the objection based on omission before the Assessing Officer failed. The revenue challenge was therefore rejected and the exemption was sustained.

---

---

Issues: (i) Whether exemption under section 54F of the Income-tax Act, 1961 was available in respect of all flats received by the assessee under a joint development agreement; (ii) Whether the appellate authority could entertain the claim for exemption under section 54F though it was not made before the Assessing Officer.

Issue (i): Whether exemption under section 54F of the Income-tax Act, 1961 was available in respect of all flats received by the assessee under a joint development agreement.

Analysis: The dispute turned on the meaning of the expression "a residential house" in section 54F in the context of flats received under a development agreement. Relying on earlier binding and persuasive decisions, the Tribunal accepted that, prior to the amendment introducing a restrictive regime, the phrase could include multiple residential units forming part of one development transaction, so long as they constituted residential property received against the transfer.

Conclusion: The assessee was entitled to exemption under section 54F in respect of all three flats received under the development agreement.

Issue (ii): Whether the appellate authority could entertain the claim for exemption under section 54F though it was not made before the Assessing Officer.

Analysis: The Tribunal applied the principle that the restriction against a fresh claim without a revised return is confined to the Assessing Officer and does not curtail the appellate authority's power to adjudicate a legitimate claim raised in appeal. On that basis, the objection based on absence of a revised return did not defeat the assessee's claim.

Conclusion: The claim was validly considered in appeal and did not fail on the ground that it was not raised before the Assessing Officer.

Final Conclusion: The revenue's challenge failed, and the exemption granted for all flats under the development agreement was sustained, rendering the other computation-related objections academic.

Ratio Decidendi: For a joint development agreement, the expression "a residential house" in section 54F may include multiple flats received as part of one residential development transaction, and an appellate authority can entertain a fresh legitimate claim even if it was not made before the Assessing Officer.

---