TaxTMI 
TaxTMI 
2018 (7) TMI 1640
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....ding only the fact that the assessee had purchased new property within two years of the transfer. 3. The assessee objected to the filing of the appeal by the Revenue on the reason that the tax effect in this case is only Rs. 4,14,625/- which is below the monetary limit of Rs. 10 lakhs fixed by the CBDT Circular No.21/2015 dated 10/12/2015. Other grounds are in support of the order of the CIT(A). 4. The facts of the case are that during the relevant assessment year, 27 cents of agricultural land belonging to the assessee at Attipa Village, Trivandrum was acquired by the State Government for a compensation of Rs. 4,14,625/-. The assessee filed his return of income for the relevant assessment year on 19/07/2006 claiming the capital gains in respect of this land as exempt u/s. 10(37) of the Act. The assessee purchased 4 cents and 752 sq. links land and a partially build house theeron on 22/01/2007 for a total consideration of Rs. 7.03 lakhs. Additional amount of Rs. 12.75 lakhs was incurred to complete the partially completed house having an area of 1500 sq. ft., thereby reinvesting a total amount of Rs. 19.78 lakhs in the new residential house. The assessee died on 20/03/2007 and pr....
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....sessee has invested capital gain in construction of new residential building only on 22/01/2007. According to him during the intermediary period from the date of transfer to the date of investment in the residential building, the amount should have been kept in the capital gain accounts deposit scheme which was not done, hence deduction u/s. 54F of the Act cannot be granted. 7. The Ld. AR submitted that the department has mechanically filed appeal against the order of CIT(A) in violation of clear directions given by the CBDT fixing the monetary limit of filing appeal with ITAT as INR 10,00,000. Section 268A(1) of the Act empowers the Board to issues instruction fixing monetary limit for regulating filing of appeal. The Ld. AR submitted that the validity of the circular has been upheld in the following cases: * Mumbal High Court in the case of CIT Vs Sunny Sounds Private Limited (2016) 381 ITR 443 (Bom); * ITAT Bangalore in the case ofACIT Vs Valmark Developers Private Limited (2018) ITA No.2648 to 2653/Bang/2017 [MANU/IL/0057/2018]; * ITAT Indore in the case of Income Tax Officer 5(3) Vs. Dinesh Khandelwal [MANU/II/0068/2016]; * ITAT Delhi in the case ofACIT Vs M/s Dallas ....
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....unt of Rs. 19.78 Lakhs in the new residential house. It was submitted that since the assessee was under the impression that capital gain is exempt u/s 10(37), alternate claim for deduction u/s 54F was first raised before the assessing officer during the course of hearing, the assesse failed to comply with the condition stipulated under section 54F(4) of the Act of depositing of unutilized amount in the Capital gain account scheme within the due date of filing return under section 139(1) of the Act. According to the Ld. AR, the assessee was under the impression that the entire Long Term capital gain of Rs. 15,28,925 will be exempt from Tax under section 10(37) being the capital gain on sale of Agriculture property, though the assessee, during the time of filing return of income, had the intention of investment of sale proceeds for purchase of new residential property, the same was not disclosed in the return of income as exemption u/s 10(37) was claimed. Hence, it was submitted that the assessee did not deposit the amount in capital gain account Scheme to be utilized for the purchase of house property and for completion of the construction, instead deposited the same in his ordinary....
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.... the intermediary period, i.e., after the sale of capital asset till the date of investment, the amount has to be deposited in an account in any such bank or institution as may be specified in and utilized in accordance with any scheme of Central Government notified in official gazette framed in this behalf and the assessee shall file proof for such deposit. The Assessing Officer in this case has rejected the claim of assessee that the assessee has not utilized the capital gains on transfer of capital asset in investment in residential building as specified in section 54F(1) of the Act on the reason that the assessee has not filed the return of income within due date in terms of sec. 139(1) of the Act. 8.2 The Ld. DR made a plea that the assessee has not invested the capital gain in the capital gain accounts deposit scheme before the due date of filing of return of income u/s. 139(1) of the Act and the investment in the residential building was made after the due date of filing the return of income and hence, the assessee is not entitled for deduction u/s. 54F of the Act. The Ld. AR's contention is that the assessee has purchased the land with partially completed building on 22/01....