TaxTMI 
TaxTMI 
2018 (4) TMI 325
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....ed in confirming the order of AO in denying exemption u/s. 54 of the Act in the facts and circumstances of the case. 3. The brief facts of the case are that the assessee is an individual and engaged in the business of commission agency for car finance and other products. The AO found that the assessee claimed capital gain of Rs. 59,07,247/- as exempt u/s. 54 of the Act by relying on various case laws. The AO was of the opinion that the assessee did not invest capital gain in purchasing new residential unit. Further, he found that the assessee availed house building loan of Rs. 82,50,000/- from ICICI Bank and invested only an amount of Rs. 9,37,921/- in new residential unit out of capital gain. The AO found that the claim of assessee was ....
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....f Kapil Kumar Agarwal is identical to the facts of the present case. The Hon'ble High Court of Punjab & Haryana considered the decision of Hon'ble High Courts of Kerala & Gauhati in the case of K.C Gopalan & Rajesh Kumar Jalan respectively and held that section 54 of the Act provides that the assessee has to purchase a house property for the purpose of his own residence within the period of one year on or after the date on which the transfer of property took place or assessee should have constructed a house property within a period of 2 years after the date of transfer. We find that it is clear from the AO's order that the assessee sold his residential units during the financial year 2009-10 and purchased a new residential flat, got its pos....
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.... 54 would also make it clear that no provision is made by the statute that the assessee should utilise the amount which he obtained by way of sale consideration for the purpose of meeting the cost of the new asset. 6. A reading of sections 53 and 54 of the Act would make it clear that a special provision is made in respect of capital gains arising out of transfer of particular type of capital asset, namely, house property which was being used by the assessee or a parent of his for the purpose of their residence. Entitlement of the exemption under section 54 relates to the cost of the acquisition of a new asset in the nature of a house property for the purpose of his own residence within the specified period." 17. Further, ....
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....n recorded by Karnataka High Court read thus:- "6. It is not in dispute that the assessee sold the agricultural land and the consideration received is in the nature of a long term capital gain. Even before the sale of the property, he had borrowed housing loan and started construction on the site belonging to him. After the sale, the amount spent towards construction of the house is more than the consideration received by the sale of agricultural land and therefore, he is entitled to the benefit of section 54F of the Act." 19. In the present case, the investment made by the assessee being within the stipulated time and more than the capital gain earned by him, the addition of Rs. 1,21,32,636/- was rightly deleted by the Tr....