TaxTMI 
TaxTMI 
2000 (2) TMI 846
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.... entitled for deduction under section 54F. 2. The brief facts of the case are that the assessee had sold 150 shares of C.J. Ltd. in June 1992 which were purchased by him prior to the year 1981 and sold for a consideration of Rs. 2,07,375 and the assessee claimed exemption under the provisions of section 54F on account of the amount invested by the assessee upto 15th October, 1992 towards construction of residential premises at Mawal Village. The details of amount invested towards the construction of said residential premises as recorded in Assessment Order at page 2 are re-produced below: A/c No. 14272 towards Construction of Residential Premises: Cost of Land as on 11-11-1988 87,500 Amt. invested on 5-....
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....eted within the specified period for the purpose of exemption under section 54F." The assessee had also produced before the Assessing Officer a certificate from one Shri J.B. Irani dated 5th August, 1992 certifying that new residential house at Khandala stood completed in all respects on the date of certificate. The certificate is re-produced below: To Whomsoever it may concern "This is to certify that for that the construction of Residential Premises at Plot No. 6 Rustic Highlanded near Khandala for Ms. Arban N. Palia and others is now complete in all respects. The cost of structure is around Rs. 11,00,000 (Rupees Eleven Lakhs only)." (Copy of the certificate specifically required by the Bench was filed by the assessee on....
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....er. He further contended that the CIT(A) has wrongly interpreted the Section 54F and also wrongly applied the decision of Karnataka High Court in the case of CIT v. J.R. Subramanya Bhat (1987) 165 ITR 571. The facts of the Karnataka High Court are different and has no application in the present facts of the case. In the said case the building was sold by the assessee in February, 1977 and the assessee had started the construction of new house in March, 1976. Thus, the facts do not favour the facts of the assessee's case. He has further drawn our attention towards the language of Section 54F in which he contended that it is clearly mentioned that the assessee is under an obligation to purchase the new residential house within a period of one....
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....efore us and also carefully gone through the citations relied upon by the learned authorised representative. In the light of facts mentioned in the above part of this decision it is clear that no investment in the new residential house constructed by the assessee was made within one year prior to the sale of shares i.e. within a period of 17th June, 1991 to 17th June, 1992. Now coming to the contention of the assessee that the material point had to be determined is when the new house is completed and it was completed only after the sale of the said shares and in view of the ratio of decision mentioned and relied upon the assessee was entitled to get the exemption under section 54F. Thus, it is necessary to go through the judgments relied up....
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....ranted the exemption in that respect. 6. The ratio in the case of J.R. Subramanya Bhat (supra) is also not applicable to the facts of the case as the asset was sold by the assessee in February, 1977 and in March, 1976 he had commenced the construction of new house which was completed in March, 1977. Thus, the assessee was held to be entitled for grant of exemption under section 54F. So all the events in this case were within the parameters of Section 54F. In the present case the investment made by the assessee is not within the period of one year prior to the original asset. Thus, the ratio of this decision is also not applicable to the facts of the case. Now coming to the case of V.M. Dujodwala (supra) the facts of this case apparently ....
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....seen from the facts that entire investment in the new asset was made from 11-1-1988 to 8-5-1991, meagre sums were shown to be invested in the new asset of Rs. 5,000 on 6th April, 1992 and a sum of Rs. 13,240.20 on 15th October, 1992. A certificate was also obtained from Architecture on 5th August, 1992 that the new asset is complete. The plain reading of certificate will suggest that the certificate in itself is vague as it does not specify the date of completion of the said house. All these exercises seem to have been made to come within the purview of section 54F as this is not a case where the assessee could be prevented by virtue of the things not in the control of the assessee to get the possession of the new asset or to show that inco....