TaxTMI 
TaxTMI 
2015 (1) TMI 1056
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....fore the Assessment of Capital Gain may be excluded from Appellants Return. 3. Commissioner of Income Tax has erred both in Law and on facts, in directing the Assessing Officer to restrict the deduction/ exemption U/s 54F of the Act. Appellant prays that he is eligible for deduction for whole of the amount as claimed. 4. Commissioner of In2c ome Tax has erred, in observing that (Para 7.1) "Assessee has constructed not just one Residential House but 16 Residential Houses" and failed to consider that still it is an One House. 5. Appellant prays for just and equitable relief. 6. Appellant prays for condonation of delay in filing appeal. 7. Appellant prays to add, alter, amend, modify the ground/s and / or withdraw the same during the Appellate proceedings." 3. At the time of hearing, the Ld. Representative for the assessee submitted that the delay of 11 months and 8 days in filing of the present appeal be condoned as the delay was unintentional and for bonafide reasons. The appellant has filed an application seeking condonation of delay in filing the appeal, whose relevant portion reads as under :- "I am educated only up to class 8th in Marathi medium, and do not ....
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....on of Rs. 67,29,218/- in terms of section 54F of the Act on account of construction of a new residential house. The balance amount of long term capital gain of Rs. 70,672/- was offered for tax as a part of the returned income of Rs. 1,67,589/-. The return of income so filed by the assessee was subject to a scrutiny assessment by the Assessing Officer u/s 143(3) of the Act vide order dated 22.12.2009. In the said assessment, the total income was assessed at the returned income of Rs. 1,67,590/-. 6. Subsequently, the Commissioner invoked his revisionary jurisdiction u/s 263 of the Act and as per his examination of record of proceedings, the Assessing Officer wrongly allowed assessee's claim for exemption u/s 54F of the Act. As per the Commissioner, assessee's claim for deduction u/s 54F of the Act was wrongly allowed because the house property constructed by the assessee actually consisted of 4 Floors each having 4 Apartments (2BHK) other than the Ground Floor. Thus, as per the Commissioner, assessee had indeed constructed not one residential house but 16 residential houses. As per the Commissioner, the requirement of section 54F of the Act was that exemption shall be granted if a....
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.... vs. Gita Duggal, (2013) 257 CTR 208 (Delhi); and, (ii) Hon'ble Karnataka High Court in the case of CIT vs. D. Ananda Basappa, (2009) 309 ITR 329 (Kar.), which were directly on the point. Following the aforesaid two judgements, it was held that the expression "a residential house" appearing in section 54F(1) of the Act is not to be understood to mean that assessee is to acquire a single residential unit. In our view, the aforesaid decision of the Tribunal in the case of Shri Narsing Gopal Patil and Others (supra) which has been relied upon by the assessee before us, clearly covers the controversy in favour of the assessee. 9. Nevertheless, we may refer to the following discussion in the order of the Hon'ble Delhi High Court the in case of Gita Duggal (supra), which has been rendered in the context of section 54/54F of the Act :- "What in effect the assessing officer had done was to reject the assessee's claim for deduction under Section 54/54F of the Act in respect of the house/units in the first and second floors holding that they were separate and independent residential units having separate entrances and cannot be considered as one unit to enable the assessee to claim the....
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....the same High Court in the decision in CIT v. Smt. K. G. Rukminiamma [2010] 196 Taxman/[2010] 8 taxmann.com 121 (Kar.). There could also be another angle. Section 54/54F uses the expression "a residential house". The expression used is not "a residential unit". This is a new concept introduced by the assessing officer into the section. Section 54/54F requires the assessee to acquire a "residential house" and so long as the assessee acquires a building, which may be constructed, for the sake of convenience, in such a manner as to consist of several units which can, if the need arises, be conveniently and independently used as an independent residence, the requirement of the Section should be taken to have been satisfied. There is nothing in these sections which require the residential house to be constructed in a particular manner. The only requirement is that it should be for the residential use and not for commercial use. If there is nothing in the section which requires that the residential house should be built in a particular manner, it seems to us that the income tax authorities cannot insist upon that requirement. A person may construct a house according to his plans and r....
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....re the Commissioner. The Commissioner, however, has not followed the judgement of the Hon'ble Karnataka High Court in the case of D. Ananda Basappa (supra) on the ground that there are contrary decisions. In this context, he has referred to the decision of the Mumbai Bench of the Tribunal in the case of ITO vs. Sushila M. Jhaveri (2007) 107 ITD 327. The said decision has b8e en rendered in a completely different context. The Tribunal was considering exemption under sections 54 and 54F of the Act, where assessee had reinvested total sale consideration in purchasing two independently located residential flats. It was held that assessee was entitled to exemption in respect of investment in only one flat. The present case stands on a completely different footing inasmuch as the residential building constructed by the assessee is at a single location and not at independent locations. Similarly, the decision of the Pune Bench of the Tribunal in the case of Shri Krishna Gopal Nagpal vs. DCIT, 82 TTJ (Pune) 481 referred by the Commissioner is also in a different context. On the other hand, the judgements of the Hon'ble Delhi and the Karnataka High Courts are directly on the point, and no c....