TaxTMI 
TaxTMI 
TaxTMI 
2014 (12) TMI 521
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....see sold the residential flat and earned Long Term Capital Gain of Rs. 1,08,94,526/-. The assessee claimed deduction u/s 54EC of the Income Tax Act of Rs. 1,00,00,000/- on account of investment in specified asset being REC bonds of Rs. 50,00,000/-on 5.2.2008 and further Rs. 50,00,000/- on 20.07.2008. The Assessing Officer restricted the deduction to the tune of Rs. 50,00,000/- as per the proviso to section 54EC(1) as well as, as per the CBDT's Circular No. 3 of 2008, wherein the quantum of investment in specified bonds was being limited to 50,00,000/-. The assessee challenged the action of the Assessing Officer before the CIT(A). The CIT(A) confirmed the action of Assessing Officer and held that the proviso to section 54EC(1) clearly laid down that there is a ceiling of investment in specified assets to the extent of Rs. 50,00,000/-. 4. Before us, the Ld. Authorized Representative of the assessee submitted that the ceiling provided under proviso to section 54EC is only for the investment of Rs. 50,00,000/- in a particular Financial Year. Since the assessee has invested 50,00,000 each in two different Financial Years and also complied with the conditions for making investment withi....
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....the assessee has submitted that the decision in the case of Areva T&D (India) Ltd. Vs. ACIT (supra) is not on the issue of total deduction allowable to the assessee u/s 54EC but he said decision was on a writ petition challenging the validity of amendment of Finance Act. 2007. Therefore, the said decision is not applicable as far as the quantum of allowability of deduction for investment in specified bonds u/s 54EC is concerned. He has further submitted that in the case of Assistant Commissioner of Income-tax Vs. Shri Raj Kumar Jain & Sons (HUF) (supra), the Jaipur Benches of the Tribunal has followed the Judgment of Hon'ble Madras High Court in the case of Areva T&D (India) Ltd. Vs ACIT (supra), which is not on the point of issue involved in the present appeal. Thus the Ld. Authorized Representative has submitted that in view of the latest decision of Hon'ble Madras High Court in the case of CIT Vs. C. Jaichander & Another (supra), the claimof the assessee is allowable. 7. We have considered the rival submissions and relevant material on record. The controversy before us is limited to the extent of quantum of deduction u/s 54EC whether it is restricted to Rs. 50 lac or not . Ther....
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....at the limit for investment is six months and the benefit that flows from the first proviso is available to the assessee if the investment is made of Rs. 50 lac in any Financial Year. The Hon'ble High Court after taking into consideration the note on clause of Finance Bill 2014 and Memorandum explaining the provisions of Finance Bill 2014, whereby, a second proviso has been inserted in the statute has observed in para 10 and 11 as under:- "10. The legislature has chosen to remove the ambiguity in the proviso to Section 54EC(1) of the Act by inserting a second proviso with effect from 1.4.2015. The memorandum explaining the provisions in the Finance (No.2) of Bill, 2014 also states that the same will be applicable from 1.4.2015 in relation to assessment year 2015-16 and the subsequent years. The intention of the legislature probably appears to be that this amendment should be for the assessment year 2015-2016 to avoid unwanted litigations of the previous years. Even otherwise, we do not wish to read anything more into the first proviso to Section 54EC(1) of the Act, as it stood in relation to the assessees. 11. In any event, from a reading of Section 54EC(1) and the first prov....
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....2004] 266 ITR 521/135 Taxman 594 to hold that since the wording of the proviso to section 54EC is clear, the benefits which are available to the assessee cannot be denied. In his impugned order, the learned Commissioner of Income-tax (Appeals) has relied on the decision of the hon'ble Madras High Court in the case of Areva T & D India Ltd. v. Asstt. CIT [2010] 326 ITR 540/[2009] 177 Taxman 192. In the case of Coromandel Industries (P.) Ltd. v. Asstt. CIT [2013] 145 ITD 171/36 taxmann.com 6, the Chennai Bench of the Tribunal, however, held that the decision of the hon'ble Madras High Court in the case of Areva T & D India Ltd. (supra) was rendered in the context of writ petition filed by the assessee challenging the amendment to section 54EC of the Act by the Finance Act, 2007, with retrospective effect from April 1, 2006 and the same therefore was not applicable in the context of interpretation of proviso to section 54EC of the Act which allowed the deduction to the assessee in respect of investment of Rs. 50 lakhs made in the eligible bonds in two different financial years. At the time of hearing, the learned Departmental representative has submitted that the decision of t....