TaxTMI 
TaxTMI 
TaxTMI 
2015 (9) TMI 374
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....ed December 19, 2011. 2. The brief facts of the case, as gathered from the record, are that the assessee, an individual, claimed exemption under section 54F of the Act in respect of the long-term capital gains (LTCG) arising to it on the sale of an industrial gala at Pragati Industrial Complex, Pune for Rs. 40.50 lakhs vide sale agreement dated July 21, 2008 (paper book pages 20-26), in view of the purchase of a residential flat in a building known as "Radha Krishna Niwas" at Vile Parle (E), Mumbai (from a builder, R. R. Constructions) along with one, Shri Swapneil Santosh Makel, for a consideration of Rs. 101 lakhs (vide article of agreement dated March 24, 2009/paper book pages 9- 18), claiming the entire amount of long-term capital gain....
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.... house, excluding the new asset, as on the date of the transfer of the original asset, i.e., July 21, 2008. Any investment made during the period July 21, 2007 and July 21, 2010 would thus qualify for exemption under section 54F. The payment of Rs. 45.19 lakhs towards the new asset during the year fell in this period. The same exceeding the consideration arising on the sale of the original asset, i.e., Rs. 40.50 lakhs, the entire long-term capital gains was exempt under section 54F. The assessee's appeal having been allowed thus, the Revenue is in appeal. 3. We have heard the parties, and perused the material on record. 3.1. It would be relevant to begin with, reproduce the relevant provision. Section 54F, in its relevant part, reads ....
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....l 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 the one residential house owned on the date of transfer of the original asset, is chargeable under the head 'Income from house property'. Explanation.-For the purposes of this section,- 'net consideration', in relation to the transfer of a capital asset means the full value of the consideration received or accruing as a result of the transfer of the capital ....
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....from the residential house/s being already owned by the assessee, i.e., as on the relevant date, the date of the transfer of the original asset (July 21, 2008). 3.2. It could be argued that the provision envisages a purchase (or construction) of a new residential house, i.e., other than those already owned by the assessee. And which is not so in the instant case inasmuch as flat "B" stood already purchased during the previous year relevant to the assessment year 2008-09 and, thus, owned by the assessee, so that the primary condition of section 54F(1), i.e., purchase or construction of a residential house, stands not met for the current year. This in fact is the case of the Revenue as made by the Assessing Officer. We consider the same to b....
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....the purchase of flat B took place on July 27, 2007 or on March 24, 2009? This is relevant as only upon "purchase" could an assessee be said to have satisfied the qualifying condition of section 54F(1), entitling it to exemption thereunder. There is no question of the issue not arising in the instant case, as contended before us by the learned authorised representative, forming in fact the substratum of the Revenue's case. It would accordingly become relevant to determine whether the purchase of flat B had taken place during the previous year relevant to the assessment year 2008-09 or the current year, or, in short, the date of its purchase. In this regard it is to be noted that the word "purchase", along with "construction", is specifi....