2017 (10) TMI 1148

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....,000 on the ground that utilization of sale consideration was no within the "due date" of return as u/s.139(1) but within the "due date" of filing return as under section 139(4). The Ld.CIT(A) ought to have accepted the appellant's claim that she is entitled to deduction u/s.54 for an amount of Rs. 35,23,226. The appellant, therefore, prays that the Ld.AO may please be directed to delete the remaining addition of Rs. 30,23,226 towards deduction u/s.54. 3. Briefly stated, the assessee, an individual, filed its return of income for AY 2011-12 wherein indexed Long Term Capital Gain (LTCG) of Rs. 35,23,326/- was inter alia declared on sale of Joint ownership immovable property for a total consideration of Rs. 1,15,00,000/-. The assessee claimed that sale consideration attributable to her was Rs. 57,50,000/- being 50% of beneficial ownership in co-ownership property held together with husband. The assessee claimed exemption on aforesaid LTCG of Rs. 35,23,326/- under s.54 of the Income Tax Act, 1961 (hereinafter referred to as "the Act") arose in her hands on the ground that she has jointly purchased another new residential house on 30/03/2013 for a consideration of Rs. 35 lakhs (bein....

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....ssessee is eligible for exemption to the extent of balance Rs. 5 lakhs only under s.54 of the Act. The CIT(A) accordingly granted partial relief. 6. Still aggrieved, the assessee is in appeal before the Tribunal. 7. The Ld.AR for the assessee Mr.P.B.Kedia reiterated the facts and submitted that the assessee sold one co-ownership residential property for a total consideration of Rs. 1.15 crores. The Assessee received her share in sale consideration between 09/03/2011 to 25/03/2011. The Ld.AR submitted that a new residential property was acquired by the assessee jointly along with her husband for a total consideration of Rs. 70 lakhs. Her ownership in the joint property stands at Rs. 35 lakhs. It was claimed that the payment for this property was made between 28/05/2011 to 15/12/2011. In support of the purchase of the new residential property, the Ld.AR referred to allotment letter dated 13/02/2012 issued by the builder "Maruti Finebuild". The Ld.AR submitted that the property was acquired and put to use within the period of two years and it was thus pleaded that the assessee deserves full relief under s.54 as claimed. The Ld.AR relied upon the decision of Ahmedabad Bench in As....

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.... date of furnishing the return. 9.1. In the instant case, the assessee claims to have utilized Rs. 15 lakhs (50% of Rs. 30 lakhs invested towards purchase of new residential House) before the due date of filing of return of income. The assessee simultaneously claims that another Rs. 5 lakhs (50% of Rs. 10 lakhs similarly invested) has been invested in the residential property before the actual filing of the return on 25/08/2011 i.e. within the time limit provided under s.139(4) of the Act. 9.2. Section 54(2) enjoins that the capital gain is required to be appropriated by the assessee towards purchase of new asset before furnishing of return of income under s.139 of the Act. Alternatively, in the event of non-utilization of capital gains towards purchase of new asset, the assessee is required to deposit the capital gains in specified bank account before the due date of filing of return of income under s.139(1) of the Act. Any payment towards purchase subsequent to the furnishing of return of income (25/08/2011 - in the instant case) but before the last date available to file the return of income under s.139(4) of the Act is irrelevant. Such subsequent payments after filing of ....

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....turn of income but before extended date available under s.139(4) would not receive beneficial construction in view of unambiguous and express provision of s.54(2) of the Act. The suggestion on behalf of the assessee on eligibility of payments subsequent to furnishing of return of income is not aligned with and militates against the plain provision of law certified in s.54(2) of the Act. 9.4. In the light of the mandate of section 54(2) as noted above, we shall now turn to the facts of the case. It is the case of the assessee that Rs. 40 lakhs in aggregate has been utilized towards purchase of new asset before furnishing the return of income under s.139(4) of the Act. The assessee claims to have invested Rs. 20 lakhs (being ½ of her share) for purchase of new asset. However, we notice that assessee appears to have shown a total investment Rs. 50 lakhs in aggregate i.e. 30 lakhs from personal account and Rs. 20 lakhs (½ share) from joint account as against her obligation to the extent of Rs. 35 lakhs only. Also ambiguity exists on record as to whether the other joint owner (husband of the assessee) has availed claim of exemption, if any, upto Rs. 20 lakhs (being &fra....