TaxTMI 
TaxTMI 
2014 (1) TMI 1491
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....controversy involved in this case are:- 1. The brief facts of the case are that the assessee filed his return of income on 29.09.2008 declaring total income of Rs.5,08,150/-. The assessee derives income from House Property, Business or Profession and Income from Capital Gain. The case was selected for Scrutiny. At the time of Scrutiny the lr. AO observed that the assessee sold a plot in Indore and purchased a flat in Banglore. The Assessing Officer made addition as assessee could not fulfill the conditions laid down in Section 54F. 2. The assessee during the year under consideration sold plot No.124, Shanti Nagar, Indore for Rs.73,36,000/- on 11.01.2008. After deducting the cost of acquisition the capital gain worked out to Rs.69,46,1....
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.... him that the flat in Bangalore was purchased on 10.06.2010, therefore, the new asset was purchased beyond the prescribed limit of two years whereas the stand of the assessee is that the construction of the residential building was completed by 29.02.2008 and possession of the flat was also taken on 26.06.2008. It was claimed that allotment-cum-possession letter of the flat was issued by the developer on 26.6.2008 when the cheques were handed over because against the total cost of flat at Rs.65 lacs, a sum of Rs.60 lacs was paid within 8 months of the sale consideration. On appeal, the learned Commissioner of the Income Tax (Appeals) granted relief to the assessee which is under challenged before this Tribunal. The relevant finding containe....
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....on'ble MP High Court has held as under:- "Held that, the Central Board of Direct Taxes had issued circular No.471 dated October, 15, 1986, stating that cases of allotment of flats under the self financing scheme of the Delhi Development Authority shall be treated as cases of construction for the purpose of capital gains. Section 54 of the Act says that within two years of sale the assessee should have constructed the house but it does not mean that the construction should necessarily be complete within two years. If substantial investment was made in the construction of the house, it amounted to sufficient steps being taken, thus satisfying the requirements of section 54, the Tribunal was not justified in denying exemption under section ....
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....sessee also furnished a certificate from the Bangalore Municipal Corporation evidencing electric connection bills for the period from January, 2008 to May, 2008. In view of these facts, we are not in agreement with the conclusion drawn by the learned Assessing Officer that the sale agreement was registered beyond the period of two years, therefore, the assessee is not entitled to exemption under section 54F of the Act. So far as the reliance on the decision in the case of Shashi Sharma vs. CIT 224 ITR 106 (MP) is concerned, we are of the considered opinion that it favours the assessee. We are usefully reproducing hereunder the relevant portion from the order of the Hon'ble jurisdictional High Court:- "Held, that the Central Board of Dire....