Tribunal upholds CIT(A) order granting exemption u/s 54, extends return filing period.

The Tribunal dismissed the Revenue's appeal and upheld the CIT(A)'s order, allowing the exemption u/s 54. The Tribunal held that the due date for filing the return of income is subject to the extended period under sub-section (4) of section 139. Additionally, the Tribunal emphasized the importance of a High Court decision and upheld the validity of the revised return filed by the assessee, granting the exemption based on these interpretations.

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Issues:
1. Allowance of deduction u/s 54 of the Income Tax Act.
2. Interpretation of the due date for filing return of income u/s 139(1) in relation to exemption u/s 54.
3. Validity of revised return filed after the due date.

Analysis:

Issue 1: Allowance of deduction u/s 54
The Assessing Officer disallowed the claim of exemption u/s 54 as the assessee did not file the original return of income within the prescribed time limit u/s 139(1). The AO required evidence of depositing the capital gain amount under the Capital Gains Accounts Scheme before the due date of filing the return. The CIT(A) allowed the exemption u/s 54 as the investment in the new house was made before the due date of filing the return of income u/s 139. The Tribunal upheld the CIT(A)'s decision, citing similar cases and the jurisdictional High Court's interpretation that the due date for filing the return is subject to the extended period provided under sub-section (4) of section 139.

Issue 2: Interpretation of due date for filing return of income u/s 139(1)
The Revenue argued that the due date should be as prescribed in sub-section (1) of section 139 based on a Supreme Court decision. However, the CIT(A) and the Tribunal relied on a High Court decision which stated that the due date for filing the return of income is subject to the extended period provided under sub-section (4) of section 139. The Tribunal upheld the CIT(A)'s decision, considering the jurisdictional High Court's judgment and a similar decision by the Chandigarh Bench.

Issue 3: Validity of revised return filed after the due date
The Revenue contended that a belated return cannot be revised and should not be the basis for granting exemption u/s 54. The assessee argued that the High Court's decision on identical facts should be followed. The Tribunal upheld the CIT(A)'s order, emphasizing the importance of the High Court's decision and the benefit granted to the assessee in a similar case involving a belated return.

In conclusion, the Tribunal dismissed the Revenue's appeal and upheld the CIT(A)'s order, allowing the exemption u/s 54 based on the interpretation of the due date for filing the return of income and the validity of the revised return filed by the assessee.

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