TaxTMI 
TaxTMI 
2016 (8) TMI 761
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....cessed u/s 143(1) (a) of the Act, 1961. The case of the assessee was selected for scrutiny and notice u/s 143(2) of the Act was issued on 08-08-2013. The ld. AR of the assessee attended the proceedings and submitted the details before the AO. The AO observed that the assessee has shown her income from house property and other sources. During the year under consideration, the assessee has shown Long term capital gain of Rs. 1,43,03,205/- and claimed exemption u/s 54F of registered sale deed 1,43,03,205/-. The AO asked the assessee to furnish the details of her income, capital gain and statement of capital gain account. The assessee had filed the details. The AO on perusal of the details filed by the assessee observed that the assessee has sold a property situated at 1, Anand Bhawan Gruh Nirman Sahkari Samiti, Tagore Nagar Yogana, Jaipur on 23-01-2012 for a consideration of Rs. 1.50 crores. The AO observed that further deduction u/s 54F had been claimed by the assessee for purchase of property at Ansal Heights, 86, Village Nawada, Fatehpur, Gurgaon and for purchase of this property the assessee has made agreement on 15-10-2012 with Ansal Housing & Construction, New Delhi. The assesse....
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....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.'' 2.2 The AO further asked the assessee that u/s 54F, she is required to deposit the sale consideration of Rs. 1.50 crores in capital gain account scheme before the due date of furnishing of return u/s 139 (1) i.e. 31-07- 2012. The AO observed that the assessee has indicated that she has opened the capital gain account in SBI, Bajaj Nagar, Jaipur bearing No. 32145102874 but the AO noticed that no such amount received on account of sale of property was deposited before 31-07-2012. The AO show caused the assessee as to why her claim u/s 54F may not be disallowed as she has made agreement for purchase of property on 15-10-2012 and not deposited entire sale consideration of Rs. 1.50 crores in capital gain account scheme before due date of filing of the income tax return. The ld. AR of the assessee filed the reply at pages 3 to 5 of the assessment order of the AO. The AO considered the reply filed by the assessee but not found tenable. The AO observed that as per Section 54F(4)....
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....s 54F of the I.T. Act, 1961 of Rs. 1,42,03,205/-. The assessee sold a residential property on 23-01-2012 while agreement for purchase of a new flat has been made on 15-10-2012. The due date of filing of income tax return for the relevant year is 31-07-2012. As per details filed, the assessee has invested Rs. 43,61,799 by 31-07-2012 i.e. before due date of filing of return 139(1) of the I.T. Act, 1961. Further, the return for this year has actually been filed by the assessee on 14- 02-2013. Further the assessee has deposited Rs. 1,06,60,000/- in the capital gain account and this amount has been deposited after 31-07-2012 but before 31-03-2014 i.e. the date of filing of return for the relevant year u/s 139(5) of the I.T. Act, 1961. The contention of the assessee is that since the entire amount of Rs. 1,06,60,000/- had been deposited before the due date of filing of return u/s 139(4), the deduction u/s 54F of the I.T. Act, 1961 should be allowed on the entire amount. The AO on the other hand has restricted the allowance to amounts deposited/utilized before the due date for filing of return u/s 139 (1) of the I.T. Act, 1961. The ld. AR has relied on the following case laws for the p....
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....in connection with such transfer.'' Thus it includes full value of consideration received or accrued and in order to claim deduction the amounts to be invested would be in relation to this net consideration. In view of the discussion above and the cases relied on including the decision of Apex Court, it is held that the amounts eligible for deduction u/s 54F of the I.T. Act, 1961 are those deposited before the filing of the return as per Section 139(1) and only those can be allowed. Thus the deduction u/s 54F of the I.T. Act, 1961 is allowed an amount of Rs. 43,61,799/- only. The order of the AO on this issue is upheld.'' 2.4 During the course of hearing, the ld. AR of the assessee prayed for deletion of addition of Rs. 1,01,42, 025/- by allowing deduction u/s 54F of the Act with following submissions. ''5. The due date for filing of the return u/s 139(1) was 31.07.2012: - The advance of Rs. 500000/-received vide Ch. No.236167 dated 20.12.2011 (PB No.23) was deposited in capital gain account No.32145102874 with SBI, Bajaj Nagar, Jaipur on 19.01.2012 . (PB No.41) - The balance sales consideration of Rs. 14500000/- was received vide post dated cheques pe....
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.... as prescribed u/s 139(1) of IT Act 1961. - the assessee has deposited unutilised sales consideration of Rs. 10660000/- in capital gain account as and when received from the buyer and before filing her return of income on 14.02.2013.(PB No.40-42) 8. As accepted by the AO the assessee has utilised the sale consideration of Rs. 4361799/- on or before the due date prescribed u/s 139(1), for making payments to M/s Ansal Housing & Construction Ltd. for construction of new residential house comprising two adjoining Flats No.D-1002 and D-1003 at Ansal Heights, Sector-86, Gurgaon, Haryana as follows:(PB No.67-75) Date R.No.D-1002/1003 Amount Flat No.D-1002 Amount Flat No.D-1003 Total 28.02.2012 495696/495695 600000/- 600000/- 1200000/- 12.03.2012 496960/496961 330899/- 331900/- 662799/- 14.04.2012 501131/501132 624500/- 624500/- 1249000/- 12.05.2012 504348/504340 500000/- 624500/- 1124500/- 12.05.2012 504343 125500/- 125500/- Total up to the date of 139(1) 2180899/- 2180900/- 4361799/- 9. The unutilised sales consideration of Rs. 10660000/- has be....
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....in Bench of ITAT as relied by ld. CIT(A) the view favorable to the assessee should be adopted as held by Hon. Supeme Court in CIT v. Vegetable Products Ltd. 88 ITR 192. 15. Thus the assessee has filed her return of income on 14.02.2013, i.e. before the due date prescribed u/s 139(4) of IT Act 1961 and has utilized the sales consideration of Rs. 4361799/- towards construction of new residential house and deposited Rs. 10660000/-in capital Gain Account before that date.'' 2.5 The ld. DR relied on the orders of the lower authorities. 2.6 We have heard the rival contentions and perused the materials available on record. It is observed that assessee has sold a property situated situated at 1, Anand Bhawan Gruh Nirman Sahkari Samiti, Tagore Nagar Yojana Jaipur on 23.01.2012, for a consideration of Rs. 1,50,00,000/-. The assessee computed a capital Gain of Rs. 1,43,03,205/- and claimed deduction of the same u/s 54F of I.T. Act, 1961 for utilising the sales consideration for the purpose of acquiring new residential House. Thus the assessee filed her return of Income on 14.02.2013 declaring capital Gain of Rs. NIL. The AO disallowed deduction of Rs. 1,01,44,025/- on the ground that....
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.... allowed u/s 139(4) should be considered to have been deposited before the due date of filing of return of income prescribed u/s 139(1) of the Act. Now the issue for our consideration is that whether the sales consideration invested in Capital Gain Account within the period allowed u/s 139 (4) should also be considered to be within the period allowed u/s 139(1) of the Act. We find that the above said issue is covered within the decision of Hon'ble . Punjab & Haryana High Court in the case of CIT v. Jagriti Aggarwal, 339 ITR 610, the relevant portion of the decision of Hon'ble Court is reproduced as follows:- 10. Having heard learned counsel for the parties, we are of the opinion that Sub-Section (4) of Section 139 of the Act is, in fact, a proviso to Sub- Section (1) of Section 139 of the Act. Section 139 of the Act fixes the different dates for filing the returns for different assesses. In the case of assessee as the respondent, it is 31st day of July of the Assessment Year in terms of clause (c) of the Explanation 2 to Sub-Section 1 of Section 139 of the Act, whereas Sub-Section (4) of Section 139 provides for extension in period of due date in certain circumstances. It reads ....
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....e involves in this appeal is as to whether extended period as per section 139(4) has to be considered for the purpose of utilization of amount of capital gain for the purpose of claiming exemption u/s 54F of the Act. The above issue is squarely covered by the decision of Hon'ble Punjab and Haryana High Court in the case of CIT V/s Ms. Jagriti Aggarwal (2011) 339 ITR 610 (P&H), wherein, Their Lordships have held that provision of section 139(4) is not an independent provision, but is related to time contemplated under the provision of section 139(1) of the Act. Accordingly, section 139(4) had to be read along with sub-section (1) of section 139 and the due date for furnishing the return of income u/s 139(1) is subject to the extended period provided u/s 139(4). Hence, extended period u/s 139(4) has to be considered for the purpose of utilization of the capital gain amount. The ITAT, Mumbai following the decision of the Hon'ble Punjab and Haryana High Court in the case of Kishore Galaiya V/s ITO (137 ITD 229) has held that when the assessee had utilized the amount which was more than the capital gain earned towards consideration of new residential house within extended period u/s 139....