2017 (7) TMI 1272

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....d to dispose-off the appeal on the basis of material available on record and after hearing Ld. Departmental Representative. 2. Facts leading to the dispute are that the assessee being resident individual was assessed for impugned AY u/s 143(3) on 31/12/2013 at Rs. 314.83 Lacs as against returned income of Rs. 64.98 Lacs e-filed by the assessee on 28/09/2011. The assessee has been denied exemption of Rs. 235.58 Lacs u/s 54F and the same is the subject matter of this appeal. 2.1 During impugned AY, the assessee earned Long Term Capital Gains [LTCG] of Rs. 235.58 Lacs on transfer of certain land to a partnership firm namely Man Sagar Infrastructure and claimed deduction u/s 54F since it made investment of Rs. 682.76 Lacs towards purchase....

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....ituated at Baroda into the partnership firm, namely, M/s Mansagar Infrastructure (the firm) as his share. The appellant has offered capital gain within the meaning of section 45(3) of the I.T. Act, 1961 and consideration was stated as the amount credited. in the books. of accounts of the firm. The said land was held by the appellant for more than 36 months. Thus, the introduction of land by the appellant in the said firm, gave rise to the long term capital gain of Rs,2,35,58,683/-. The appellant invested a sum of Rs. 6,82,76,081 within stipulated period in the new residential house and claimed exemption u/s 54F of the Act. On the date of transfer of the said land at Baroda the appellant owned one residential house in his individual capacity....

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....s. Hon'ble ITAT concluded that the assessee was not the owner of a residential house, jointly owned by the assessee and his wife, on the date of transfer of original asset within the, meaning of section 54F of the Act. 5.2.3 Hon'ble ITAT, Chennai Bench in the case of ACIT. Central Cir.3(1), Chennai vs. Shri K. Surendrakumar (ITA No.1234/MDS/2010 dated 12.08.2011) has also held that in the circumstances the finding of the Ld.CIT(A) holding that the assessee is entitled to the deduction u/s 54F of the Act us on a right footing and does not call for any interference. Hon'ble ITAT has also considered and relied on the decision given by Hon'ble Supreme Court in the case of Seth Banarsi Das Gupta vs. CIT(166 ITR 783) (SC) wherein it ....

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.... an individual or a HUF, should not own more than one residential house in the status of an individual or HUF as on date of his transfer. Thus, the condition in the proviso has to go with the understanding of the same status stipulated in the parent provision under section 54F of the Act. In this case, the appellant owned a residential house along with his daughter under a joint ownership or as a co-owner therein, the ownership in a status other than that of individual/HUF would not result in the denial of exemption t of The Act. Strong reliance is placed on the following decisions:- (i) ITO. Ward 22(3)(3) vs. Rasiklal N. Satra reported as (2006) 98 ITD 335 (Mum). (ii) ACIT. Central Cir. 3(1), Chennai vs. Shri K. Surendrak....