2016 (6) TMI 1122

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.... the present appeal after hearing the learned Departmental Representative for the Revenue.   3. The Revenue has raised the following grounds of appeal:- 1. The ld. CIT(A)-2, Nashik has erred in holding that exemption u/s 54EC is allowable in excess of Rs. 50 lacs if investment is made in two financial years. 2. Whether the ld. CIT(A)-2 is correct on relying on the judgment of Madras High Court in case of CIT Vs Jaichandar & Sriram Indubal TC(A) No.419 & 533 of 2014 in the facts & circumstances of assessee's case. 4. The only issue raised in the present appeal filed by the Revenue is against allowability of deduction under section 54EC of the Act in excess of Rs. 50 lakhs if investment is made in two financial years. 5. B....

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....nancial year 2010-11. The CIT(A) noted the claim of assessee that where the investment was made during the specified period of six months, then the limit of Rs. 50 lakhs was applicable to the investment made during the financial year and where the period of six months comprised of two financial years, then the total investment of Rs. 1 crore i.e. Rs. 50 lakhs in each financial year was permissible to be made. If the intention of legislation was to allow the exemption of Rs. 50 lakhs only, then the same could have been easily done by providing limit in the main provisions itself. With regard to the reliance placed upon by the Assessing Officer on ACIT, Circle-2 Vs. Shri Rajkumar Jain and Sons (HUF) in ITA No.648/JP/2011 and the directions....

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.... months from the date of transfer, though in two distinct financial years to the tune of Rs. 72,50,000/- was eligible for exemption under section 54EC of the Act. The CIT(A) also noted that no contrary court decision of the High Court level had been brought to his notice. 7. The Revenue is in appeal against the order of CIT(A). 8. The learned Departmental Representative for the Revenue strongly relied on the decision of Jaipur Bench of Tribunal. However, no contrary decision of any other High Court was referred to by the learned Departmental Representative for the Revenue. 9. The issue arising in the present appeal is against the claim of deduction under section 54EC of the Act, under which deduction is provided against the income ....

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....pital assets, the said deduction was allowable to the assessee. The Hon'ble High Court of Madras in CIT Vs. C. Jaichandar (supra) has held that as per the mandate of section 54EC(1) of the Act, time limit for investment is six months and benefit that flows from the first proviso is that if the assessee makes investment of Rs. 50 lakhs in any financial year, it would have benefit of section 54EC(1) of the Act. The Hon'ble High Court further held that however, to remove the ambiguity in the above said provisions, legislature by Finance (No.2) Act, 2014 w.e.f. 01.04.2015 had inserted proviso after existing proviso to sub-section (1) of section 54EC of the Act. The second proviso, as per which the investment made by the assessee in long term ca....