2019 (4) TMI 1024 - AT - Income Tax

Joint ownership not absolute for tax exemption. Tribunal grants appellant's claim under Section 54F.

Ashok G. Chauhan Versus Asst. CIT- 17 (3), Mumbai

Ashok G. Chauhan Versus Asst. CIT- 17 (3), Mumbai - TMI Issues:1. Consideration of Long Term Capital Gain on Surrender of Tenancy Right2. Exemption under Section 54 F of the Income Tax Act3. Deemed ownership under Section 27(i) of the Income Tax Act4. Acceptance of additional evidence for deciding the date of transferIssue 1: Consideration of Long Term Capital Gain on Surrender of Tenancy RightThe appellant contested the inclusion of Long Term Capital Gain of Rs. 8,50,00,000 on the surrender of tenancy right for the Assessment Year 2010-11. The appellant argued that the Commissioner of Income Tax (Appeals) should not have considered this gain.Issue 2: Exemption under Section 54 F of the Income Tax ActThe appellant claimed exemption under Section 54 F of the Income Tax Act, contending that they were not the owner of two residential houses as the property in Goa was jointly owned with the wife and later gifted to their daughter. The appellant cited relevant case law to support their claim that shared interest in a property does not amount to ownership for the purpose of exemption under Section 54 F.Issue 3: Deemed Ownership under Section 27(i) of the Income Tax ActThe dispute revolved around whether the appellant should be deemed the owner of the property in Goa under Section 27(i) of the Income Tax Act due to the transfer to their minor daughter. The appellant argued that even if deemed owner, they could not be considered the absolute owner of the property, hence entitled to exemption under Section 54 F.Issue 4: Acceptance of Additional Evidence for Deciding Date of TransferThe appellant challenged the acceptance of additional evidence by the Commissioner of Income Tax (Appeals) for determining the date of transfer concerning the tenancy holding of the property, emphasizing the importance of possession as crucial evidence of tenancy right.The Tribunal analyzed the arguments, case law, and provisions of the Income Tax Act. Ultimately, the Tribunal allowed the exemption under Section 54 F for the appellant, concluding that joint ownership does not equate to absolute ownership for the purposes of claiming exemption. The Tribunal directed the Assessing Officer to grant the exemption under Section 54 of the Act. As a result, the appeal filed by the appellant was partly allowed, with certain grounds becoming infructuous and others requiring no specific adjudication.