2011 (9) TMI 161

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..... During the assessment proceedings u/s 143(3) of the Income-tax Act, 1961 (for short hereinafter referred to as "the Act"), the assessing authority noticed that the assessee has derived income from house property, income from long term capital gains on sale of property at Bangalore and income from other sources such as interest and dividend income. The assessee sold her residential property for Rs. 2,21,00,000 and had invested an amount of Rs. 49,09,804 on purchase of residential property and claimed exemption u/s 54 of the Act. On verification of the purchase deed of the said property dated 25.12.2006 registered in the officer of the sub-registrar, Haveli, Pune, he found that the above property was not in the name of the assessee alone bu....

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....ell as in the bonds, as the entire consideration for acquisition of the same is flown from the assessee, in law the assessee's husband has no right. In that view of the matter, the Tribunal held that both the assessing authority and the Appellate Commissioner were in error in denying the benefit of deduction and allowed the deduction. Aggrieved by the same, the revenue is before this Court. 4. Learned counsel appearing for the revenue assailing the impugned order contended that the original asset sold is in the name of the assessee. Unless the assessee invests the sale consideration in acquisition of an immovable property or the bonds in her name exclusively, she is not entitled to the benefit of deduction as in the sale deed she has inc....

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....In the absence of evidence as to the interests in the fund to which they were respectively entitled, or as to the shares which they respectively advanced, such persons shall be presumed to be equally interested in the property." 7. On careful reading of section 54 as well as section 54EC on which reliance is placed makes it clear that when capital gains arise from the transfer of long term capital asset to an assessee and the assessee has within the period of one year before or two years after the date on which the transfer took place purchase or has within the period of three years after the date of construction of residential house then instead of capital gain being charged to Income-tax as income of the previous year in which the tran....