TaxTMI 
TaxTMI 
TaxTMI 
2016 (10) TMI 202
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....stead of condition relating to "buying" of the flat is applicable while allowing the exemption of long term capital gain under section 54 of the Income Tax Act, 1961. 2) On the facts and in the circumstances of the case and in law, the Ld.CIT (A) erred in allowing the exemption of long term capital gain under section 54 of the Income Tax Act, 1961, wherein purchase of residential house is not within the period of two years from the transfer of original asset." 2. None appeared on behalf of the assessee despite of service of notice by RPAD. However, we find that the matter could be disposed of even without the presence of the assessee. Therefore, we heard the Ld. Ld. Departmental Representative and the appeal is disposed of on the basis....
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....erefore, he allowed the exemption reversing the action of the assessing officer with the following observations: "2.3 1 have gone through the contention of the appellant as well as that of the A.0. I have perused the copies of agreements produced before me in regard to the claim of deduction made by the appellant u/s.54 of the Act. The claim of exemption was primarily denied on the ground that the appellant failed to take possession new residential property within two years of sale of old residential property and the building was not complete as on 0303.2013 The A.O. throughout the assessment order went on applying the condition of purchase of new residential property within two years of sale of old property, however, she overlooked the p....
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....ree years he had invested Rs. 1,03,50,932/- which was more than the amount of capital gain forming substantial part of his sale consideration, in construction of new residential house. Thus, in my view, the claim of exemption cannot be denied on the ground that the possession of the flat had not been taken within the period of three years. 2.5 The A.O. has tried to distinguish the case of the appellant and CBDT circular no.672 dated 16.12.1933, relied upon by the appellant on the ground that the same is applicable to specified authorities. In this regard, the reliance is to be placed on the case of Srnt. Sunder Kaur Sujan Singh Gadh (2005) 3 SOT 206, Mumbai Bench of Tribunal, wherein it was held that the builder would fail in the /catego....
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....icer. 6. It is noted by us that the assessee had sold the property on 04- 03-2011 and, therefore, as per section 54, the assessee was required to construct a new residential house by 04-03-2014 since section 54 allows exemption to an assessee of long term capital gain arising from sale of residential house if the amount of capital gain is invested in construction of new residential house within a period of 3 years. There is no specific requirement that assessee should also obtain the possession of the same within the period of three years. The emphasis is upon the utilization of the amount in purchase / construction of the new residential house. It is noted that undisputedly, the assessee invested a sum of Rs. 1,03,50,932 which was more th....