2013 (12) TMI 592

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.... disposed off by this consolidated order for the sake of convenience. Common grounds of appeals have been raised by both the assessees, which read as under:- 1. That the Ld. Commissioner of Income Tax (Appeals) has erred in law as well as on facts in upholding the addition 11,91,379- made on account of disallowance of exemption under section 54 of the Act which is arbitrary & unjustified. 2. That the Ld. Commissioner of Income Tax (Appeals) has failed to appreciate that the benevolent provisions as enumerated in section 54/54F of the Act ought to be construed liberally and as such the addition upheld is arbitrary & unjustified. 3. That the Ld. Commissioner of Income Tax (Appeals) has further erred in sustaining the addition of Rs.3....

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....see had utilized onl y a sum of Rs. 23,61,550/-(full share) in the purchase of the new asset along with his wife and the remaining amount of sale consideration as well as capital gain was invested in the purchase of FDRs etc. and was not utilized for the purchase / construction of the new house in Sector 11, Panchkula. The Assessing Officer accordingl y restricted the exemption u/s 54 of the Act upto the extent of Rs. 23,61,550/-. The Assessing Officer thus allowed a sum of Rs. 11,80,775/- as the exemption u/s 54 in the hands of each of the assessee as against Rs. 23,72,154/- ( ½ share) claimed by each of the assessee. The balance sum of Rs. 11,91,371/- each was added to the income of the assessee. The C IT(A) upheld the order of the....

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....e said residential house in Sector 11, Panchkula. 6. Under the provisions of Section 54 of the Income Tax Act, the assessee is entitled to the benefit of exemption from capital gains arising form transfer of a residential asset where it invested the capital gains in the purchase of a new residential house. The said section further provides that the exemption is available where the new asset was purchased within the period of one year or two years after the date on which the transfer took place or the assessee has within a period of three years of constructed the new residential house. The Ld. AR for the assessee fairl y pointed out that in case the benefit of exemption u/s 54 is to be allowed to the assessee onl y where investment is mad....