Capital gains relief for reinvestment was upheld where the statutory time condition was satisfied despite staged conveyance.

Capital gains relief under section 12B(4)(b) of the Indian Income-tax Act, 1922 was available where the statutory reinvestment period was satisfied on the facts found. The sale transactions for the property extended over more than one stage and beyond the accounting year, but that did not defeat the relief because the assessee had acquired another bungalow within the prescribed period. Whether transfer occurred only on execution of the sale deeds or at an earlier stage did not alter the result. The question of use of the premises within two years was not examined and remained outside consideration.

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Issues: Whether the assessee was entitled to the benefit of section 12B(4)(b) of the Indian Income-tax Act, 1922, in respect of capital gains arising from the sale of the property.

Analysis: The relevant purchases and sale deeds showed that the sale of the property was completed only over a period extending beyond the accounting year, and the assessee had acquired another bungalow within the prescribed period. The question whether transfer occurred only on execution of the sale deeds or at an earlier stage did not alter the result, because the statutory conditions for the relief were satisfied on the facts found. The user of the premises within two years was not raised or investigated and therefore remained outside consideration.

Conclusion: The assessee was entitled to the benefit of section 12B(4)(b), and the question was answered against the revenue.

Ratio Decidendi: Where the statutory time condition for reinvestment is satisfied on the facts found, capital gains relief cannot be denied merely because the transactions in respect of the property extended over more than one stage of conveyance.

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