Capital gains exemption under section 54F stands where deposit and timely utilisation satisfy the statutory conditions.

Deduction under section 54F was upheld where the sale consideration was deposited in the capital gains account scheme and then utilised within the prescribed time. The appellate finding that the statutory conditions were satisfied was not displaced by any contrary material from the revenue, so the deduction could not be denied. The assessee's relief was sustained and the revenue's challenge failed.

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Issues: Whether the assessee was entitled to deduction under section 54F of the Income-tax Act, 1961 on the amount deposited in the capital gains account and utilized within the prescribed time.

Analysis: The assessment was completed under section 143(3) of the Income-tax Act, 1961 and the revenue challenged only the allowance of deduction under section 54F. The factual finding accepted by the appellate authority was that the sale consideration was deposited in the capital gains account scheme and the amount was utilized within the statutory time limit. The revenue did not point out any material to displace the valuation or the factual basis on which the deduction was granted.

Conclusion: The deduction under section 54F was rightly allowed and the revenue's challenge failed.

Final Conclusion: The appellate relief granted to the assessee was sustained and the revenue appeal did not succeed.

Ratio Decidendi: Where the conditions of section 54F are satisfied by deposit in the capital gains account scheme and utilization within the prescribed period, the deduction cannot be denied in the absence of contrary material.

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