TaxTMI 
TaxTMI 
TaxTMI 
2018 (1) TMI 1106
X X X X Extracts X X X X
X X X X Extracts X X X X
....ng the bonafides of the appellant while disallowing the claim of Rs. 22,65,274.00. 2-The appellant craves leave to add, alter, amend and / or rescind any ground of appeal during the course of hearing. 2. Rival contentions have been heard and record perused. Facts in brief are that the assessee is an individual and had filed return of income on 25/03/2012 showing total income of Rs. 8,57,020/-. The assessment was completed u/s. 143(3) determining the total income at Rs. 41,35,975/- after making the additions of. long term capital gains of Rs. 32,52,854/-. 3. The Assessing Officer stated that assessee had computed capital gains at Rs. 32,52,854/- and the same was claimed as exemption u/s.54 of the Act. During the assessment proceedings, t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e entire claim of Rs. 32,52,854.00 and assessed the income at Rs. 41,35,980.00 which includes Rs. 8,11,333.00 [salary] which was disclosed. 6. I also found that till the date of filing the return of income the assessee had paid the builder an amount of Rs. 11,43,435.00. The municipal authorities stopped the construction activity of the builder in which the assessee had intended to take the flat. The balance was kept in fact by the assessee in his bank account ready. When the builder informed the assessee after a gap of 42 months that he has got all the clearances / permission from the competent authority, he immediately made the payment of Rs. 22,65,274.00 from 17/02/2015 to 03/10/2016. As the circumstances were beyond his control he did n....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f transfer of original asset or two years after the date of transfer of original asset or constructed a residential house within a period of 3 years from the date of transfer of original assets, the long term capital gain resultant from transfer of original asset shall be dealt with as follows: (1) If the long term capital gain from transfer of original asset is more than the investment in new residential house, the difference between long term capital gain and investment in new residential house shall be taxable u/s.45. (2) If the long term capital gain from transfer of original asset is less than investment in new residential house, the long term capital gain shall be NIL. (e) However, if the assessee has sold the new house within 3....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed to ensure that the proceeds of sale of original assets are available to the assessee in the intervening period for investment in residential house and are not frittered away. However, where the assessee invested the sale proceeds in FDR instead of the Capital Gain Account Scheme, 1988 and acquired the house within specified period by investing the sale proceeds, he has satisfied the spirit of Sec.54(1) and therefore, he should not be denied the benefit for technical violation as provided u/s.54(2) of the Act. 9. From the record, we found that the assessee sold his flat on 2nd April, 2008 for a consideration of Rs. 30,40,000/-, The entire sale proceed was invested in term deposit on 07.04.2008 because he was under bonafide belief that i....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the object of the statute to effectuate the legislative intention. 11. Furthermore Hon'ble Supreme Court in case of Sanjeev Lal 365 ITR 389 observed as under:- "Income-tax on the long-term Capital gain. The intention of the Legislature or the purpose with which the said provision has been incorporated in the Act is also very clear that the assessee should be given some relief. Though it has been very often said that common sense is a stranger and an incompatible partner to the Income-tax Act and it is also said that equity and tax are strangers to each other, still this court has often observed that purposive interpretation should be given to the provisions of the Act. In the case of Oxford University Press v. CIT [2001] 3 SCC 3591 thi....