Appeal Dismissed: Section 54 Exemption Limited to One Property

The ITAT Jaipur dismissed the appeal, upholding the decisions on the validity of the order passed under sections 147/144, disallowance of a portion of the cost of acquisition, and denial of benefit under section 54 for the purchase of a second house. The CIT(A) disallowed the further deduction for the second house purchase, citing that section 54 exemption applies only for one new house property. Legal precedents and judicial decisions supported this view, leading to the dismissal of the appellant's claim for the second house purchase.

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Issues:
1. Validity of order passed under section 147/144 of the Income Tax Act, 1961.
2. Disallowance of a portion of the cost of acquisition.
3. Allowance of benefit under section 54 for the purchase of a second house.

Issue 1: Validity of Order Passed under Section 147/144:
The appeal challenged the order passed by the CIT(A) confirming the action of the Assessing Officer under sections 147/144 of the Income Tax Act, 1961. The appellant argued that the order was void ab initio and should be quashed. However, the grounds related to this issue were not pressed during the hearing and were dismissed.

Issue 2: Disallowance of a Portion of the Cost of Acquisition:
The appellant contested the adoption of the cost of acquisition at Rs. 2,12,250 by disallowing an amount of Rs. 4,04,737. The specific grounds related to this issue were also not pressed during the hearing and were dismissed.

Issue 3: Allowance of Benefit under Section 54 for Second House Purchase:
The primary issue revolved around the denial of the benefit of Rs. 7,25,630 claimed by the assessee under section 54 for the purchase of a second house. The CIT(A) examined this claim and allowed a deduction of Rs. 1,51,030 for Stamp Duty and Registration charges related to the first property. However, the further deduction of Rs. 7,25,630 for the second house purchase was not allowed. The CIT(A) held that the exemption under section 54 is applicable only for the purchase of one new house property, even before the specific amendment introduced in section 54 with effect from 01-04-2015. This view was supported by judicial decisions. The ITAT Mumbai Bench and the Punjab & Haryana High Court had previously ruled similarly on the matter. Considering the legal precedents and the factual aspects, the appellant's claim for the second house purchase was dismissed.

In conclusion, the ITAT Jaipur dismissed the appeal of the assessee, upholding the decisions made regarding the issues raised. The judgment provided detailed reasoning for each issue, citing relevant legal provisions and judicial precedents to support the conclusions reached.

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