AI Drafter 
TaxTMI 
TaxTMI 
2018 (4) TMI 1728
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....early covered by the proviso to Section 54F of the IT Act as he owned more than one residential house other than the new asset on the date of transfer of the original asset. (3) Based on the facts and circumstances of the case, the Ld.CIT(A) has failed to appreciate that the assessee owned the following properties on the date of transfer of original asset which were residential in nature. a. a residential property at Chilimbi b. property situated at "Palemar" Bejai, Mangalore, survey No.117-A, 142/2A, Kodialbail, Mangalore c. property at Katipalla Village, Mangalore d. an Apartment of 1112 sq.ft. at 1st floor with one covered Car Parking Space at Basement Floor, marked as No.10, situated at 1st Main Road, Kalidas Lane, Gandhi Nagar, Bangalore e. a residential property at 90B, Boloor Village, Mangalore (4) Based on the facts and circumstances of the case, the Ld. CIT(A) ought to have appreciated that all the above properties are residential in nature as per the purchase deed of the property. These properties are owned by the assessee on the date of transfer of the original asset. (5....
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....r, Bangalore on 06.01.2009 as it was not registered in the name of the purchaser and the assessee has not recognized any long term/ short term capital gain on this transaction and the property is shown in the Balance Sheet of the assessee for AY 2010-11 as his asset. Hence the assessee has not recognized the transaction on 06.01.2009. Hence he is the owner of the flat which is a residential unit. (11)Based on the facts and circumstances of the case, the Ld. CIT (A) has erred in allowing the assessee's claim that the unoccupied residential properties are not residential properties and should not be treated as residential units for the purpose of allowance of deduction U/s 54F of the IT Act. (12)Based on the facts and circumstances of the case, the Ld. CIT(A) ought to have appreciated that the completed, unsold flat in the construction project of the assessee, are also residential properties, which are owned by the assessee, hence may be included for the purpose of disallowance of deduction U/s 54F of the IT Act. (13)Based on the facts and circumstances of the case, the Ld.CIT(A) has failed to appreciate that the assessee&#....
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....order where AO has noted that in addition to the self occupied residential property, the assessee has a residential property at 90B, Boloor Village, Mangalore purchased on 26.02.2010. He pointed out that the AO considered the assessee's explanation that this property is part of Chilimbi property owned by the assessee but the AO has noted that as per the purchase deed of the property. it is a separate property situated on the land of 9.5 cent with residential building bearing D.No. 2-1-42&2-1-42/1. The AO has noted that this might be adjacent to the Chilimbi property, which is shown in the Fixed Assets Schedule of the Balance Sheet of the assessee and the assessee might have clubbed all the land in the properties, which is called as Chilimbi property in the Balance sheet for the purpose of development of residential complex but it does not take out the individual status of this property, which shows that it was a residential property at the time of sale of original asset during the F.Y. 2010-11. Hence for the purpose of this assessment order, this property is also treated as residential house in the ownership of the assessee. Thereafter the Id. DR of revenue pointed out that in ....
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.... in the last page of Wealth Tax return, the assessee has considered Chilimbi property at Mangalore as self occupied house property and claimed exemption from the Wealth Tax in respect of that property also and therefore, the assessee himself is accepting that Chilimbi property is self occupied house property in addition to self occupied house property at `Palemar at Bejai Church Road, Mangalore which has been considered as self occupied property by AO in Para no. 1 on page 17 of the assessment order and therefore, it is clear that on 30.11.2010, the assessee was owning more than one residential house. Learned AR of the assessee supported the order of CIT (A). Regarding the wealth tax return for AY 2011 - 12 brought on record by the DR of the revenue, she submitted that this property at Chilimbi is exempt from wealth tax for some other reason but by mistake, it is stated in the wealth tax return that it is self occupied house property and therefore, because of a mistake in wealth tax return, the issue in income tax cannot be decided against the assessee. 5. We have considered the rival submissions. First, for the sake of ready reference, we reproduce various re....
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....ined as part of Chilimbi property by the assessee. As per the purchase deed of the property, it is a separate property situated on the land of 9.5 cent with residential building bearing D. No.2-1-42 & 2-1-42/1. This might be adjacent to the Chilimbi property, which is shown in the Fixed Schedule of the Balance Sheet of the assessee. The assessee might have clubbed all the land in the properties, which is called as Chilimbi property in the Balance-sheet for the purpose of development of residential complex. But, it does not take out the individually status of the property, which shows that it was a residential property at the time of sale of original asset during the F.Y.2010-11. Hence, for the purpose of this order, this property is also treated as a residential house in the owner ship of the assessee. 5) The property at Katipalla Village, Mangalore is described in the Gift Deed dt. 121-2009 as a property consisting of 10.2 acre of land with a building bearing No. Katipalla 9-27A, 27A-1 & 27B. The assessee has explained it as an Agricultural Property in the Balance-sheet. It does not change the character of the property that the agricultural land was having a buildi....
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....ess than the net consideration in respect of the original asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of the new asset bears to the net consideration, shall not be charged under section 45: Provided that nothing contained in this sub-section shall apply where the assessee owns on the date of the transfer of the original asset, or purchases, within the period of one year after such date, or constructs, within the period of three years after such date, any residential house, the income from which is chargeable under the head "Income from house property", other than the new asset. Explanation.-For the purposes of this section,- (i) "long-term capital asset" means a capital asset which is not a short-term capital asset; (ii) "net consideration", in relation to the transfer of a capital asset, means the full value of the consideration received or accruing as a result of the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with such transfer." 7. Now we reproduce the relevant paras from the order of CIT(A) as per which the....
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....Hence, the appellant was asked to produce the details of cost of improvement. The Appellant has filed the bills and vouchers for Rs. 80,15,683/- in support of his claim, out of the cost of improvement claimed in the return of income Rs. 1,00,06,853/-. The detailed submissions were made by the appellant in support of his claim. Finally, the appellant has voluntarily agreed for 40% of the disallowance of said expenditure, since additions made in the cost of improvement to the land has been done in the various years from 2003-2004 onwards, appellant is not sure, if the department makes any further investigation, then the contractors will confirm the transactions at a particular point of time. Accordingly, on the basis of the admissions done by the appellant, 40% of the cost of improvement claimed in the return of income is disallowed and cost of improvement is allowed only to the extent of 60% of Rs. 1,00,06,853/-, which is equal to Rs. 60,04,112/-. 6.2 The AR has argued that, the property at Chilimbi and property situated at survey No.90B Boloor Village are adjoining properties and is used for storing building construction materials. The same is later converted for de....
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.... the above paras reproduced from the order of CIT(A), it is seen that although the order of CIT (A) appears to be very cryptic as contained in only in Para 6.4 as reproduced above but this is also seen that in Para 6.2 of his order, he has noted all the arguments of the learned AR of the assessee before him and thereafter, in Para 6.4, he has stated that he finds force in these arguments and on that basis, he has decided the issue in favour of the assessee and it means that he has accepted those contentions and therefore, we have to examine the acceptability of those arguments and decide the present appeal of the revenue. One more new relevant fact has been brought on record before us by the learned DR of the revenue i.e. Wealth Tax return filed by the assessee for Assessment Year 2011-12 as per which, the assessee himself has claimed that Chilimbi property is a self occupied house property and the same is in addition to residential house property at Mangalore considered by the AO as per Para 1 on page 17 of his order as reproduced above. Regarding this, the argument of the learned AR of the assessee is this that this property at Chilimbi is exempt from wealth tax for some other re....
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.... of section 54F. This view of us is supported by the tribunal order rendered in the case of Sanjeev Puri vs. DCIT as reported in 160 ITD 213 (Del) on which reliance is placed by the learned AR of the assessee and copy submitted by her on pages 66 & 67 of the paper book filed on 05.04.2018. In that case, the property was shown as residential house in municipal records but was actually used by the assessee as office. Under these facts, it was held by the co ordinate bench that this property cannot be considered as a residential house for determining eligibility of the assessee to claim deduction u/s 54F. As per the assessee in the present case, this property is being used for storing construction material. About this claim of the assessee that this property is being used for the purpose of storing construction material, the AO has stated on page 17 of the assessment order as reproduced above that the assessee has not produced any evidence to prove this claim. The AO has also noted that this property is demolished by the assessee and a multi storied complex is coming up on the land of this property and hence, it is not possible to verify the use of this property at the relevant point ....
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.... a residential house but there is no finding of the AO that it is actually used for residential purposes. In the absence of this finding of the AO that this property was actually used for residential purposes and the failure of the learned DR of the revenue to bring any evidence before us in this regard to dislodge the claim of the assessee and finding of CIT (A) that this property is not a residential property, we hold that this property also cannot be considered as a residential house property owned by the assessee on the relevant date. 13. Regarding the remaining property i.e. Flat at Ashoka Majestic, we find that about this property, the AO says on pages 18 & 19 of the assessment order that this flat is a residential flat and it is in the ownership of the assessee on the relevant date because it was sold by the assessee only on 28.04,2011 and therefore, on the relevant date, it was owned by the assessee. As against this, it is noted by CIT (A) on page 6 of his order that it was pleaded by the assessee before him that this flat was agreed to be sold vide agreement dated 23.02.2010 and sale deed was executed on 28.04.2011. This was also pleaded that the unsold flats wer....