Deduction u/s 54B allowed when investment made before belated return filed within extended Section 139(4) deadline

ITAT Ahmedabad held that for deduction under s.54B, the expression "due date" in s.54B read with s.139 includes the extended time under s.139(4). The assessee, having filed a belated return u/s 139(4), could not be denied the benefit of investment in new agricultural land made up to the date of such belated filing, provided the investment preceded the actual filing date. The matter was remanded to the AO to verify whether the assessee invested in the new asset before filing the return on 24.02.2014 and, if so, to grant deduction u/s 54B accordingly. Appeal allowed for statistical purposes.

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Issues:
Allowability of deduction under s. 54B of the Income Tax Act, 1961 concerning AY 2012-13.

Detailed Analysis:

1. ITA No.109/Ahd/2017:
- The assessee challenged the disallowance of deduction under s. 54B of the Act.
- The Assessing Officer disallowed the claim as the assessee failed to deposit the capital gains in the bank account as required by s. 54B(2) of the Act.
- The CIT(A) allowed deduction for land purchased before the sale but denied deduction for land purchased after the due date of filing the return.
- The Tribunal found in favor of the assessee, holding that the investment in the new asset was made before filing the belated return, complying with s. 54B(2) requirements.
- The issue was remanded to the AO for verification of factual aspects regarding the investment in the new asset.

2. ITA No.110/Ahd/2017:
- Similar to the first appeal, the issue was the denial of deduction under s. 54B.
- The Tribunal upheld the claim for deduction under s. 54B on first principles and remanded the issue to the AO for verification of investment in the new asset.
- The appeal was allowed for statistical purposes.

Conclusion:
Both appeals were allowed for statistical purposes, with the Tribunal ruling in favor of the assessee regarding the eligibility of deduction under s. 54B of the Act. The factual aspects of the investment in the new asset were to be verified by the Assessing Officer in both cases.

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