2017 (10) TMI 1143

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....ts of the case, contrary to the evidence on record and unsustainable in law. The Commissioner (Appeals) has passed a cryptic order without properly examining the relevant facts and law. 2. The Learned Commissioner (Appeals) failed to appreciate that the appellant had complied with all the requirements of Section 54 (1) of the Act since the appellant had purchased a residential apartment of value more than the Date of Hearing: 15.06.2017 Date of Pronouncement: 31.08.2017 capital gains and the new residential asset was purchased within 2 years from the date of sale of residential property. 3. The Learned Commissioner (Appeals) failed to appreciate that the appellant had admittedly sold the property on 09-08-2012 and had purc....

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....als) also failed to appreciate that the appellant had admittedly deposited the entire capital gains with the bank under term deposit instead of deposit under capital gains account scheme which is merely a technical default and exemption cannot be denied. 8. For these and other grounds that may be urged at the time of hearing, it is prayed that appeal may be allowed". 2. Brief facts of the case are that the assessee, an individual, filed his return of income for the A.Y 2013-14 on 4.10.2013 admitting total income of Rs. 4,44,240. The assessee claimed exemption of capital gain u/s 54F of the Act. Brief facts relating to this issue are that during the relevant A.Y, the assessee jointly sold an immovable property vide document No.32....

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....o the AO that the deposit was into a normal term deposit A/c and not a capital gain a/c. Observing that the unutilized portion of the capital gain has to be deposited in the capital gain a/c u/s 54 F of the Act, before the due date of filing of return u/s 139(1) of the Act and also that the flats allegedly purchased by the assessee were in joint names of the assessee and his son, the AO disallowed the claim u/s 54F of the Act and brought the entire amount of capital gain to tax. Aggrieved, the assessee preferred an appeal before the CIT (A) who confirmed the order of the AO and the assessee is in second appeal before us. 5. The learned Counsel for the assessee submitted that the assessee had invested the entire sale consideration in purc....

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....eme and find that such an account can be opened only by depositing the entire capital gain funds and not with partial sale withdrawals and the money can be withdrawn only by giving a written application giving details of the purpose of fund requirements such as for purchase of a property or construction of a house and cannot avail any loan facility on such funds. Thus, the intention of introducing the capital gain a/c scheme is to see that where the assessee intends to claim the benefit u/s 54 of the Act, the capital gains are parked with the bank till the assessee identifies the property and invests the same within the specified period. Except for the above conditions, there is not much of a difference between the term deposit and the CGAS....

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....vested in the new property after filing the return of income but before the time u/s 139(4) expires, whereas in the said case the investment was made prior to filing of the return u/s 139(4) of the Act. 11. However, section 54 of the Act being a beneficial provision introduced with the goal of providing residence to the citizens of India, has to be construed liberally as long as it serves the purpose of its enactment. As held by the Hon'ble Supreme Court of India in the case of Kunal Singh vs. Union of India, reported in (2003) ARI SCW 1013 "in construing a provision of social beneficial enactment, ..... the view that advances the object and serves its purpose must be preferred to the one which obstructs the object and paralyses the ....