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of <h1>Tribunal remands case for additional evidence on construction completion time. Importance of fair hearings emphasized.</h1> <h3>The Deputy Commissioner of Income Tax, Circle 3 (1) (1), Bangalore. Versus Shri Bollinni Gurappa Naidu, Bangalore</h3> The Tribunal remanded the case to the Assessing Officer for proper verification and consideration of additional evidence related to the completion of ... Deduction u/s 54F - AO disallowed the exemption claimed u/s 54 and Sec 54F - additional evidences in support of assessee’s claim towards completion of the construction of the residential house within the time specified u/s. 54 was admitted without calling for a remand report by the Ld.CIT(A) - HELD THAT:- As details in respect of allowability of the claim were furnished before the CIT(A) by the assessee and the Ld.AO has not got any opportunity to verify these details. The Ld.DR thus prayed for the issue to be remanded to the Ld.AO. AR did not object for the remand to the Ld.AO. Considering the submissions, we remand this issue to the Ld.AO keeping all the contentions open. The Ld.AO is directed to consider the claim in accordance with law. Issues:Appeal against disallowance of exemptions u/s 54 and 54F for A.Y. 2015-16.Analysis:The case involved the appeal filed by the revenue against the disallowances made by the Ld.AO regarding exemptions claimed u/s 54 and 54F for A.Y. 2015-16. The assessee had declared an income of Rs. 22,20,040/- and had sold residential flats and commercial properties, investing in a residential site for construction of houses. The Ld.AO disallowed exemptions amounting to Rs. 3,20,59,991/- u/s 54 and 54F, leading to the assessment being concluded on 28.12.2017.The assessee contended before the Ld.CIT(A) that investments totaling Rs. 5,25,00,000/- had been made in the residential site for construction purposes, claiming that the cost of the land should be considered as part of the residential house for the purpose of exemptions. The Ld.CIT(A) considered the submissions and held that the appellant had indeed invested the specified amount within the stipulated time frame, relying on case laws and Circular No. 667 dated 18/10/1993. The Ld.CIT(A) observed that the conditions for claiming exemptions u/s 54 were fulfilled, and the deductions u/s 54 and 54F were acceptable. The Ld.CIT(A) emphasized that the provisions of sections 54 and 54F should be construed liberally to promote investments in residential houses.Aggrieved by the Ld.CIT(A)'s decision, the revenue appealed before the Tribunal. The Ld.CIT.DR raised concerns regarding the verification of additional evidence related to the completion of construction within the specified time frame. The issue was remanded to the Ld.AO for proper verification and consideration in accordance with the law. The Tribunal allowed the appeal for statistical purposes, emphasizing the necessity of granting the assessee a proper opportunity to be heard.In conclusion, the judgment addressed the disallowance of exemptions u/s 54 and 54F for A.Y. 2015-16, highlighting the importance of fulfilling conditions for claiming deductions and interpreting tax provisions liberally to encourage investments in residential properties. The case underscored the need for proper verification and adherence to legal procedures in tax assessments.
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