Tribunal directs reassessment under section 54F, adds 53,020 to total income.

The tribunal partly allowed the appeal, directing the Assessing Officer to recalculate the exemption under section 54F while confirming the addition of 53,020 to the total income.

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Issues:
- Appeal against order of CIT(A) for assessment year 2012-13.
- Disallowance of exemption u/s.54 of the I.T. Act.
- Denial of indexed cost of improvement on property.
- Denial of benefit of section 54F due to property purchase in wife's name.
- Addition of &8377; 53,020 to total income.

Issue 1: Appeal against CIT(A) Order
The appeal was filed by the assessee against the order of the CIT(A)-2, Bhubaneswar for the assessment year 2012-13. The assessee raised grounds challenging the arbitrary, illegal, and erroneous nature of the order, seeking deletion of additions to total income disallowing exemption u/s.54 of the I.T. Act.

Issue 2: Disallowance of Exemption u/s.54 of the I.T. Act
The assessee contended that the AO and CIT(A) did not allow indexed cost of improvement on the property, which the assessee argued was unjust and unreasonable. The AO relied on details filed before the Civil Court, while the assessee claimed improvement based on photographs showing enhancements. The tribunal noted that the wife of the assessee, co-owner of the property, had not been allowed any improvement cost, leading to dismissal of the claim.

Issue 3: Denial of Indexed Cost of Improvement
The tribunal observed that the AO had denied cost of improvement due to lack of supporting evidence like bills or photos confirming enhancements. The tribunal found that the details submitted before the Civil Court were crucial and could not be disregarded without concrete evidence of improvements by the assessee, ultimately dismissing the claim for indexed cost of improvement.

Issue 4: Denial of Benefit under Section 54F
The assessee was denied benefit under section 54F as the property was purchased in the name of the wife and son. Citing judicial pronouncements, the assessee argued for a liberal interpretation of the law to include legal heirs for exemption. Relying on various court decisions, the tribunal held that the exemption under section 54F could not be denied merely due to property purchase in the wife's name, directing the AO to recalculate the exemption accordingly.

Issue 5: Addition to Total Income
Regarding the addition of &8377; 53,020, the tribunal confirmed the addition as the AR did not present any arguments, resulting in the confirmation of the addition to the total income.

In conclusion, the tribunal partly allowed the appeal, directing the AO to recalculate the exemption under section 54F while confirming the addition of &8377; 53,020 to the total income.

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