2017 (3) TMI 890
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.... of the Act were issued and duly served upon the assessee calling for various details. Details as required by the Assessing Officer were furnished. Ld. Assessing Officer observed that sundry creditors of Rs. 7,02,042/- brought forward from previous years could not be proved genuine by the assessee with the support of necessary details and subsequent thereto ld. Authorised Representative of the assessee offered the cumulative sum of such credit balance amounting to Rs. 7,02,042/- as income of assessee under the provisions of sec.41(1) of the Act. 3. Ld. Assessing Officer also observed that assessee has claimed deduction u/s 54EC of the Act at Rs. 1 crores by way of investment in the specified assets at Rs. 50 lacs each spread up over two Financial Years but this investment was made within six months from the date of sale of asset. Accordingly income was assessed at Rs. 2,56,61,637/- after disallowing claim of deduction u/s 54EC of the Act at Rs. 50 lacs and making addition u/s 41(1) of the Act at Rs. 7,02,042/-. 4. Aggrieved, assessee went in appeal before ld. Commissioner of Income Tax(A) against both the additions and partly succeeded. Ld. Commissioner of Income Tax(A) confirmed....
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....ra-3 of the assessment order that the appellant offered the aforesaid credit balances amounting to Rs. 7,02,0427- as income of the assessee for the year under consideration. 4.4. However, during the appellate proceedings, the appellant has made the submission on merits which has been reproduced in the preceding paras. It is to be noticed that during the course of appellate proceedings the appellant voluntarily offered the ceased liabilities as income of the year under consideration on agreed basis and now in the appeal he had challenging the addition without any basis. In this regard the Hon'ble Kerala High Court in the case of Mahesh B. Shah Vs. CIT 238 ITR 130 has held that no appeal lies against agreed additions unless assessee's proves coercion and malafide. Same view has also been endorsed by Hon'ble Bombay High Court in the case of Rameshchandra & Co. Vs. CIT 168 ITR 375. So, in the appellate proceedings the appellant except the submission on merits has not given any details challenging the action of the A.O stating that the addition was made by way of coercion or malafide at the level of A.O. Since the appellant has voluntarily offered the ceased liability as i....
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....eived Rs. 4,00,50,000/- out of which he claimed exemption u/s 54F of the Act for purchasing a residential bungalow at Rs. 77 lacs and further investment of Rs. 50 lacs twice in the bonds issued by National Highway Authorities of India Ltd. for claiming deduction 54EC of the Act. Ld. Assessing Officer followed the decision of the Co-ordinate Bench, Jaipur in the case of ACIT, Circle-2, Ajmer vs. Shri Raj Kumar Jain & Sons (2012) 50 SOT 213 (Jp) and limited assessee's claim of deduction u/s 54EC to Rs. 50 lacs as against Rs. 1 crores. 11. Ld. Departmental Representative vehemently argued supporting the order of Assessing Officer. 12. On the other hand, ld. Authorised Representative heavily relied on the findings of ld. Commissioner of Income Tax(A) and also referred to the judgment of Hon. Madras High Court in the case of Commissioner of Income Tax vs. C. Jaichander pronounced on 15.9.2014 confirming the decision of the Co-ordinate Bench, Chennai in the case Shri C. Jaichander vs. ACIT in ITA No.456/Mds/2013 for Asst. Year 2009-10 dated 01.11.2013. 13. We have heard the contentions of ld. Representatives and perused the records placed before us. Solitary grievance raised by Revenu....
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....nt has claimed that the investment limit of Rs. 50 lakhs is applicable to a financial year only and he can make another investment of Rs,50 lakhs in the subsequent year also but within 6 months from the date of transfer of the property. He has mentioned that the language of the proviso to Section 54EC (w.e.f. 1.4.2007) that the investment of Rs. 50 lakhs can be made in "any financial year". So the assessee has made the first investment in the year under consideration and subsequent investment in another assessment year and as such the proviso does not debar the assessee to claim the deduction in the subsequent year although made within the time limit of 6 months from the date of transfer. In support of the same he has relied upon various decisions. 3.6. In the case of Aspi Ginwala, Shree Ram Engineering & Manufacturing Industries Vs. ACIT, Circle, Baroda in IT appeal No.3226 of 2011 vide order dtd. 30.03.2012 the Hon'ble ITAT Bench-C, Ahmedabad has granted the deduction of Rs.l crore in two different financial years made but within six months from the transfer. Relevant portion of the findings are as under:- "The dispute which is to be decided in this case is whether as per ....
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....4EC of the Income-tax Act, 1961 - Capital gains - Not to be charged on investment in certain bonds - Assessment year 2008-09 - Whether where assessee invested Rs.l crore in capital bonds in two equal installments in two different financial years within six months period from date of transfer of capital assett assessee was eligible to claim exemption upto Rs.l crore - Held, yes." Further in the case of ITO, Wd-2, Margas, Goad, Vs. Ms. Rania Faleiro [2013] 33 taxmann.com 611 (Panaji - Trib.) Section 54EC of the Income-tax Act,1961 - Capital gains - Not to be charged on investment in certain bonds [Quantum of exemption] - Assessment year 2008-09 - Whether condition for availing of exemption under section 54EC requires that investment can be made within a period of 6 months and if 6 months fall within two different financial years, assessee can make investment in two different financial years provided in a financial year investment made did not exceed Rs. 50 lakhs - Held, yes - Assessee sold a property on 5.2.2008 and computed capital gain at Rs. 1.16 crores - She had invested in Capital Gains Bonds a sum of Rs. 50 lakhs on 31.3.2008 and a sum of Rs. 50 lakhs on 30.6.2008 - In retur....
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....l appearing for the respondent in T.C. (A)No.533of2014 5. The key issue that arises for consideration is whether the first proviso to Section 54EC(i) of the Act would restrict the benefit of investment of capital gains in bonds to that financial year during which the property was sold or it applies to any financial year during the six months period. 6. For better understanding of the issue, it would be apposite to refer to Section 54EC(i) of the . Act, which reads as under: "Section 54EC. Capital gain not to be charged on investment in certain bonds^ (i) Where the capital gain arises from the transfer of a long-term capital asset (the capital asset so transferred being hereafter in this section referred to as the original asset) and the assessee has, at any time within a period of six months after the date of such transfer, invested the whole or any part of capital gains in the long-term specified asset, the capital gain shall be dealt with in accordance with the following provisions of this section, that is to say, (a) if the cost of the long-term specified asset is not less than the capital gain arising from the transfer of the original asset, the whole of such capital ....
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....isting provisions contained in subsection (i) of section 54EC provide that where capital gain arises from the transfer of a long-term capital asset and the assessee has within a period of six months invested the whole or part of capital gains in the long-term specified asset, the proportionate capital gains so invested in the long-term specified asset out of total capital gain shall not be charged to tax. The proviso to the said sub-section provides that the investment made in the long-term specified asset during any financial year shall not exceed fifty lakh rupees. It is proposed to insert a proviso below first proviso in said sub-section (i) so as to provide that the investment made by an assessee in the long-term specified asset, from capital gains arising from transfer of one or more original assets, during the financial year in which the original asset or assets are transferred and in the subsequent financial year does not exceed fifty lakh rupees. This amendment will take effect from 1st April, 2015 and will, accordingly, apply in relation to assessment year 2015-16 and subsequent years-Memorandum: Explaining the provisions in the Finance (No.2) Bill, 2014: Capital gai....