TaxTMI 
TaxTMI 
TaxTMI 
2015 (2) TMI 451
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....01 and has paid amounts to the builder towards the fulfilment of the agreement as requisitioned by the builder. While filing the Return of Income the amounts so paid were claimed as deduction. Subsequently during the course of assessment proceedings the assessee filed a revised working of deductions u/s 54F restricting the deduction to Rs. 89,99,724 being amount paid before the due date for filing the return. As per the provisions of Sec. 54F, if any amount of sale receipts remain unutilised as on the due date for filing the return the same should be deposited in a specific bank account under the Capital Gains Deposit Scheme 1988. As the assessee was not aware of such a provision, he did not deposit the money in the bank account but paid the amount to the builder. Therefore, he has revised the computation and accordingly requested the AO to restrict the deduction. 3. During the course of assessment proceedings it was further submitted that the flat No. A 401 was not in a completely habitable state, though structures etc., were completed. This delay was entirely due to the reasons beyond the control of the assessee. When this was pointed out by the AO and when it was put to him tha....
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....he assessee was denied exemption on the investments made with Delhi Development Authority. However, relief was granted by the Hon'ble High Court. It was held that section 54 of the Act of 1961 only says that within two years, the assessee should have constructed the house but that does not mean that the construction of house should necessarily be complete within two years. What it means is that the construction of house should be completed as far as possible within two years. In the modern days, it is not easy to construct a house within the time-limit of two years and under the Government schemes, takes years and years. Therefore, confining to two years' period for construction and handing over possession thereof is impossible and unworkable under section 54 of the Act. If substantial investment is made in the construction of house, then it should be deemed that sufficient steps have been taken and this satisfies the requirements of section 54. Therefore, the view taken by the Tribunal is not correct. iii) Satish Chandra Gupta vs. Assessing Officer, 54 ITD 508 (ITAT, Delhi Bench): The facts of this case were, the assessee had purchased a site and could not complete the co....
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....iolation of any of the provisions of section 54F of the Act could have been taxed in the assessment year corresponding to the previous year in which 3 years period for construction would elapse. The authorities below could not have brought to tax the capital gains in the assessment year under construction. 8. The learned counsel for the assessee submitted before us that the learned CIT(A) ought to have noted that once the investment is made within 2 years, and the delay in construction is beyond the control of the assessee, the same needs to be condoned irrespective of the period and there is no basis to put an artificial restriction on the period of condonation. In any case, the learned CIT(A) ought to have taken into account the details submitted during the course of appellate proceeding that the construction of flat purchased by the assessee is completed by the builder, except completion of common lift. Therefore, there is no basis to conclude that the project will not be completed at all and consequently the conclusion of the CIT(A), on incorrect assumption of facts, is not sustainable. 9. The learned counsel also relied on the decision of Narasimha Raju Rudra Rao vs. ACIT (3....
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.... 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 net consideration in respect of the original asset, the whole of such capital gain shall not be charged under section 45 ; (b) if the cost of the new asset is less than the net consideration in respect of the original asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of the new asset bears to the net consideration, shall not be charged under section 45: Provided that nothing contained in this sub-section shall apply where- (a) the assessee,- (i) owns more than one residential house, other than the new asset, on the date of transfer of the original asset; or (ii) purchases any residential house, other than the new asset, within a period of one year after the date of transfer of the original asset; or (iii) constructs any residential house, other than the new asset, within a period of three years after the date of transfer of the original asset; and (b) the income from such residential house, other than t....
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....tion as may be specified in, and utilised in accordance with any scheme which the Central Government may, by notification in the Official Gazett, frame in this behalf and such return shall be accompanied by proof of such deposit; and, for the purposes of sub-section (1), the amount, if any, already utilised by the assessee for the purchase or construction of the new asset together with the amount so deposited shall be deemed to be the cost of the new asset: Provided that if the amount deposited under this sub-section is not utilised wholly or partly for the purchase or construction of the new asset within the period specified in sub-section (1), then,- (i) the amount by which- (a) the amount of capital gain arising from the transfer of the original asset not charged under section 45 on the basis of the cost of the new asset as provided in clause (a) or, as the case may be, clause (b) of sub-section (1), exceeds (b) the amount that would not have been so charged had the amount actually utilised by the assessee for the purchase or construction of the new asset within the period specified in sub-section (1) been the cost of the new asset, shall be charged under section 45 as inc....