TaxTMI 
TaxTMI 
2018 (1) TMI 182
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....8,53,775/- as against Rs. 2,32,23,657/- correctly claimed by the assessee. 2. That the appellant craves the permission to add to or amend to any of the above grounds of appeal or to withdraw any of them." 2. Brief facts of the case are that the assessee is an individual deriving income from firm(s) M/s Rajnikant Nem Chand & Co. and Goregaon Gan Agency. The assessee during the year sold a land at 5/B, Laxmi Industrial Estate, Link Road, Goregaon, Mumbai on 21.10.2011 for a consideration of Rs. 3,65,25,000/-. The assessee declared Long term capital gain of Rs. 3,53,66,100/- and claimed exemption u/s 54EC at Rs. 50,00,000/- and 54F at Rs. 2,32,23,657/-. The sale of land was effected by Registered Deed of Conveyance cum lease executed between seller(s) and purchaser vide deed dated 09.09.2011 and presented before Sub-registrar Distt. Borivali on 09.09.2011 Mumbai. The Assessing Officer accepted the claim of deduction u/s 54EC of the Act for Rs. 50,00,000/-. However, he restricted the deduction to Rs. 1,10,25,000/- u/s 54F of the Act being amount deposited in capital gain deposit scheme on 28.09.2012. He also claimed the deduction of Rs. 1,25,00,000/- deposited on 28.03.2013....
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....ce i.e. transfer of property and Rs. 1,43,75,000/- after due date of filing of return. In view of the above facts of the case and from positions of law the assessee on show cause notice of Ld. A.O. filed his explanation which was rejected by Ld. A.O. In this connection it is submitted that Ld. A.O. has while invoking provisions of Section 54F (4) has not properly appreciated the position of law while disallowing the claim of deduction u/s 54F of I.T. Act rightly claimed by assessee. The Section 54F mandates that the amount of net consideration which is not appropriated by the assessee towards the purchase or construction of new asset within specified period(s) u/s 54F(2) before the date of furnishing the return of income u/s 139 shall be deposited by him before furnishing such return in capital gain deposit scheme. The provisions of section 54F (4) are akin to Section 54 (2) and the Gauhati High Court in case of CIT vs. Rajesh Kumar Jalan (2006) 286 ITR 274 while interpreting Section 54 (2) which is equally applicable for provisions of section 54 F (4) held as under:- "From a plain reading of sub-s. (2) of s. 54 of the IT Act, 1961, it is clear that only s. 139 of....
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....n or any purchase of the property and if such investment is made within the period stipulated therein i.e. Section 139 (4), then section 54F (4) is not at all attracted and therefore, the contention that the assessee has not deposited the amount in the bank account as stipulated and therefore, he is not entitled to the benefit is also not correct reliance was also placed on judgments of Karnataka High Court in case of CIT vs. K. Ram Chandra Rao (2015) 230 taxman 334 and judgment in case of Dr. Xavier J. Pullikal vs. DCIT (2014) 104 DTR 134 (Ker.) The Ld. A.O. in assessment order relied on judgment of ITAT, Delhi Bench in case of Taranbir Sawhney vs. DCIT (2006) 5 SOT 417. The case was decided beforethe judgment of Gauhati High Court in case of CIT vs. Rajesh Kumar Jalan hence cannot be applied. This has been noticed by ITAT, Bangalore Bench in case of Nipun Mehrotra vs. ACIT (supra) and Hon'ble ITAT held the same view. The CIT(A) has simply followed the judgment of Bombay High Court in case of Humayun Suleman Merchant (Supra) in deciding the appeal while the assessee cited the judgment of CIT Vs. Rejesh Kumar Jalan (supra) & Fathima Bai Vs. I.T.O. (supra) and vari....
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....ds on 3.8.2007 and 27.10.2007. The Assessing Officer held that the date of transfer was 12.7.2005 and as the section 54EC investments had been made beyond a period of 6 months from the date of transfer, the exemption was not available. The assessee claimed that as it was impossible for him to invest within 6 months from the date of transfer, the period of six months had to be reckoned from the date of receipt of consideration. Held by the Tribunal: Though section 54EC requires the investment to be made within 6 months of the date of transfer, a technical interpretation cannot be adopted but it has to be interpreted having regard to the purpose and spirit of the section. In circular No. 791 dated 2.6.2000 the CBDT held in the context of capital gains arising under section 45 (2), that through the transfer arises in the year of conversion of a capital asset into stock in trade, the period of six months for investment under section 54EC has to be reckoned from the date of sale of the stock-in -trade. The CBDT appreciated the impossibility of the assessee being able to invest the amount in specified assets within six months from the date of transfer. This interpretation of the....
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..... 1,43,75,000/- presented on 19.04.2012 and the same was credited in the assessee account on 21.04.2012. Similarly at the request of purchaser the assessee accepted the cheque No. 202378 dated 18.10.2012 in place of Cheque No. 202337 dated 11.06.2012. The same was credited to the Bank A/c of the assessee on 20.10.2012. These facts establishes that assessee received major part of sale consideration much after date of conveyance deed. Assessee received Rs. 1,43,75,000/-even after due date of filing of return of income. 7. Admittedly, the sale consideration received beyond the date of transfer of the asset in such a factual situation the Hon'ble ITAT, Pune A Bench while deciding the ITA Nos. 594 to 597/Pn/2010 in the case of Mahesh Nemichandra Ganeshwade vs. ITO in its order dated 29th March, 2012 reported in (2012) 17 ITR_TRIB 116 has held, the claim of the assessee allowable. The Hon'ble Supreme Court in the case of CIT, Bangalore v. J.H.Gotla reported in [1985] 156 ITR 323 (SC) held that if a strict and literal construction of the statute leads to an absurd result, i.e., a result not intended to be subserved by the object of the legislation ascertained from the scheme of the leg....
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....the relevant assessment year or before the completion of the assessment whichever is earlier under subsection (4) of section 139 of the Income-tax Act, 1961." 8. In a recent decision of ITAT Jaipur, Co-ordinate Bench in the case of Smt. Maya Devi Sharma The similar issue has been decided by the ld. CIT(A) by holding as under:- "We have heard the rival submissions and perused the material available on record. After examining the material on record and orders of the lower authorities, we find that it is an undisputed fact that assessee had received on-money from the sale of plot in Taru Chhaya Nagar which was reinvested in the new house. This fact was also admitted by assessee's husband in the statement recorded u/s 132(4) of the Act and also when the assessee filed the return of income in response to the notice u/s 153A, the additional income was disclosed on the basis of the investments made in various years. However the AO assessed the income of the assessee in the year when the on-money was received from the sale of plot which action was not disputed by the assessee. The AO herself in the order at page 17 tabulated the details of datewise investment made by the assess....
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....ayment of on-money at the time of reinvestment of the same. The Hon'ble Gujrat High Court in the case of Glass Lines Equipments Co. Ltd V/s CIT reported in 253 ITR 454 has held as under: "Interpretation of documents - Documents must be read as a whole- it is a well settled canon of interpretation that a document has to be read as a whole" it is not permissible to accept a part and ignore the rest of the document." Since the assessee has made the payments towards the acquisition of new property within the time limit permissible u/s 139(4) of the Act and the payments have duly been acknowledgement by the AO herself in the assessment order itself, we find no reason to hold that there were no evidence found for such investments. The decision of Hon'ble Jurisdiction High Court in the case of Jai Steel (Supra) is also not applicable the present case as there is no claim made in the return filed u/s 153A which was not claimed in the original return. In that case, in the original assessment no claim was made towards the deduction u/s 801 which was made afresh in the return filed u/s 153A and under these facts the Hon'ble Court has observed that no fresh claim could be mad....