2017 (4) TMI 1440

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....in short 'the Act') dated 20/01/2014. 2. The Revenue has raised the following Grounds of appeal:- "1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in allowing the claim of exemption u/s 54 of the I.T. Act by the assessee for the investment of Rs. 1,12,75,000/-, being the sale consideration of immovable property in India, in buying the residential apartment in New York, USA of Rs. 2,20,00,000/- without appreciating the fact that the exemption is available only when investment is carried out in India. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in relying on the decision of Mumbai Tribunal in the case of Mrs. Prema P. Shah & Sanjiv P. Shah Vs. ITO(100 ITR ....

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....al property did not meet the requirements of section 54 of the Act as the property was acquired outside India. In coming to such conclusion, the Assessing Officer relied upon the decision of the Ahmedabad Tribunal in the case of Smt. Leena J. Shah , 6 SOT 721(Ahd). In appeal before the CIT(A), assessee contended that during the relevant period, there was no requirement in section 54 of the Act that the investment in the new property is to be made in India. The CIT(A) noticed that the requirement of making the investment in a property in India India was inserted by the Finance (No.2) Act, 2014 w.e.f. 01/04/2015 and, therefore, in the instant assessment year the claim of exemption under section 54 of the Act could not be denied on this ground....

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....e have carefully considered the rival submissions. Undoubtedly, prior to the amendment made by Finance (Nos.2) Act, 2014 w.e.f. 01/04/2015, the language of section 54 of the Act required the assessee to invest the capital gain in a residential property. It is only subsequent to the amendment, which has come into effect from 01/04/2015, that such investment is required to be made in a residential property in India. The assessment year before us is prior to 01/04/2015, and, therefore, the amendment would not be applicable. A similar situation, though in the context of section 54F of the Act, has been considered by the Hon'ble Gujarat High Court in the case of Smt.Leena J. Shah (supra); notably, so far as the impugned issue is concerned, t....