2016 (7) TMI 1000

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....ption u/s.54F of the Act on thereason that the return filed by the assessee u/s.139(4), as such the benefit u/s.54F is denied. 3. The facts of the case are that the assessee sold the properties situated at Nelankarai and Chenglepet and declared capital gains from these two properties at 77,15,927/-. The assessee claimed exemption u/s.54F of the Act on investment in a flat for Rs. 68,82,120/- and thereby declared net taxable capital gains at Rs. 8,33,807/-. The AO was of the opinion that the assessee has filed the return of income not u/s.139(1) of the Act and it was filed belatedly u/s.139(4) of the Act, as such the assessee is not entitled for exemption u/s.54F of the Act. Aggrieved, the assessee carried the appeal before the Ld.CIT(A).....

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....d.CIT(A). 6. We have heard both the parties and perused the material on record. Admittedly, in this case the assessee filed the return of income on 11.08.2011 for assessment year 2011-12. There was no original return of income filed by the assessee for this assessment year. As per section 139(1) of the Act, the return for assessment year 2011-12 mus have filed on or before 31.07.2011. The AO denied the exemption u/s.54F of the Act on the reason that the return filed within the extended time limit available of filing of return of income u/s.139(4) cannot be considered. In our opinion the Karnataka High Court in the case of Fathlima Bai Vs. ITO reported in 32 DTR 243, Gauhati High Court in the case of CIT Vs. Rajesh Kumar Jalan reported in....

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....in the case of CIT Vs.Shri R.Srinivas reported in 2015-TIOL-2623-HC -Kar-II. However, we came across the decision of same High Court in the case of CIT Vs. K.Ramchandra Rao reported in 277 CTR 522 wherein held that as per sec.54F(4), in the event of the assessee not investing the capital gains either in purchasing the residential house or in constructing a residential house within the period stipulated in s. 54F(1), if the assessee wants the benefit of s. 54F, then he should deposit the said capital gains in an account which is duly notified by the Central Government. In other words, if he wants claim of exemption from payment of income-tax by retaining the cash, then the said amount is to be invested in the said account notified by Central....