TaxTMI 
TaxTMI 
2014 (8) TMI 899
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....nstruction as a single residential unit under Section 54F, without considering the intention of the legislature to restrict the reinvestment to only one more residential unit under Section 54F? 2. Whether on the facts and circumstances of the case, the Tribunal was right in interpreting the phrase "a residential house" in plural connotation for the purpose of reinvestment of capital gain for claiming exemption under Section 54F?" 2. The brief facts are as follows: The respondent/assessee had entered into an agreement with one M/s.Mount Housing and Infrastructure Ltd., for development of a piece of land measuring 13,059 sq.ft. owned by her at Door No.29F, Race Course, Coimbatore. As per the agreement, the assessee was to receive 43.....
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....ection 54F in respect of one single flat with largest area of 4814.36 sq.ft. and accordingly directed the Assessing Officer to calculate the exemption under Section 54F of the Income Tax Act. Aggrieved by this order, the assessee preferred further appeal before the Income Tax Appellate Tribunal. 5. The Tribunal, after considering the orders of the Authorities below, held in paragraph No.4 of the order that as the assessee's representative admitted that with regard to the substitution of sale consideration based on the cost of construction of the developer, M/s.Mount Housing and Infrastructure Ltd., the order of the Commissioner of Income Tax (Appeals) could not be faulted. Also, the Tribunal, by considering the provision of Section 5....
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....ips took cue from the decision of Hon'ble Karnataka High Court in the case of Smt.K.G.Rukminiamma (Supra). Similar exemption was given by the Hon'ble jurisdictional High Court again in the case of Dr.(Smt.)P.K.Vasanthi Rangarajan (supra) wherein there was no claim that flats allotted in lieu were having single number. We are therefore of the opinion that assessee was eligible for claiming exemption under section 54F of the Act on the five flats received by her in lieu of the land she had parted with." 6. The Tribunal further held that the principles mentioned in Section 54 of the Income Tax Act, as interpreted by the Karnataka High Court in the above-said decision, would apply paripassu to Section 54F also. Hence, the Tribunal ca....
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.... (1) Subject to the provisions of sub-section (4), where, in the case of an assessee being an individual or a Hindu undivided family, the capital gain arises from the transfer of any long-term capital asset, not being a residential house (hereafter in this section referred to as the original asset), and the assessee has, within a period of one year before two years after the date on which the transfer took place purchased, or has within a period of three years after that date constructed, a residential house (hereafter in this section referred to as the new asset), the capital gain shall be dealt with in accordance with the following provisions of this section, that is to say,-- (a) if the cost of the new asset is not less than the ne....
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....;by the Finance (No.2) Act, 2014, with effect from 01.04.2015." 10. The above-said amendment to Section 54F of the Income Tax Act, which will come into effect only from 01.04.2015, makes it very clear that the benefit of Section 54F of the Income Tax Act will be applicable to constructed, one residential house in India and that clarifies the situation in the present case, i.e, post amendment, viz., from 01.04.2015, the benefit of Section 54F will be applicable to one residential house in India. Prior to the said amendment, it is clear that a residential house would include multiple flats/residential units as in the present case where the assessee has got five residential flats. We may also mention here that all the Authorities below have....