2022 (2) TMI 330 - AT - Income Tax

Appellate Tribunal affirms CIT(A) on admissibility of evidence & exemption under section 54F.

ACIT, Circle-29 (1) New Delhi Versus Sanjeev Bhalerao

ACIT, Circle-29 (1) New Delhi Versus Sanjeev Bhalerao - TMI Issues:1. Admissibility of additional evidences during appellate proceedings.2. Acceptance of claim u/s. 54F without documentary evidence.3. Acceptance of claim regarding sale of art effects.Analysis:Issue 1: Admissibility of additional evidences during appellate proceedingsThe revenue challenged the admission of additional evidences by the assessee during appellate proceedings, arguing that the assessee had sufficient opportunity during assessment proceedings to submit documentary evidences. However, the ld. CIT(A) admitted the additional evidences based on the facts that the plea for claiming exemption of sale proceeds from art effects was presented to the Assessing Officer during original assessment proceedings. The ld. CIT(A) found that no adverse comments/evidences were brought to controvert the claim of the appellant, leading to the deletion of the addition.Issue 2: Acceptance of claim u/s. 54F without documentary evidenceThe revenue contested the acceptance of the claim u/s. 54F by the ld. CIT(A) during appellate proceedings without examining the conditions prescribed for availing the claim and the absence of documentary evidence to substantiate mandatory conditions. However, the ld. CIT(A) held that the appellant had made an investment in a residential property, satisfying the conditions of section 54F. The ld. CIT(A) further noted that the investment in the property exceeded the sale consideration received, making the entire capital gain eligible for exemption from tax.Issue 3: Acceptance of claim regarding sale of art effectsThe revenue raised concerns regarding the acceptance of the claim made during appellate proceedings concerning the sale of art effects, specifically miniature paintings, solely on the appellant's account. The revenue argued that the sale was made jointly with the appellant's spouse, rendering the claim of exempt income unsubstantiated. However, the ld. CIT(A) found the submissions regarding the sale of art effects to be in order, as the investment in the residential property was supported by relevant documents and met the requirements of section 54F.In conclusion, the Appellate Tribunal upheld the decision of the ld. CIT(A) based on the facts presented and declined to interfere with the order. As a result, the appeal of the revenue was dismissed, and the entire capital gain was deemed exempt from tax.