TaxTMI 
TaxTMI 
2019 (9) TMI 295
X X X X Extracts X X X X
X X X X Extracts X X X X
....der of AO, assessee carried the matter before Ld.CIT(A), who vide order dated 29.01.2016 (in appeal No.PN/CIT(A)- 9/ITO Wd.8(3)/751/2014-15) dismissed the appeal of assessee. Aggrieved by the order of Ld.CIT(A), assessee is now in appeal before us and has raised the following grounds : "1. In the facts and circumstances of the case and m law, the learned C.I.T.[A] has grossly erred in assessing in the hands of the appellant the Long Term Capital Gains of Rs. 1,09,91,914.00, on transfer of leasehold rights in Plot of land bearing No.97/22 in Sector 6 at Moshi PradhikaranTaluka Haveli District Pune. The aforesaid decision being patently illegal, bad in law, arbitrary, perverse and devoid of merits the same may please be vacated. 2. In the facts and circumstances of the case and in law, the learned C.I.T. [A] has grossly erred in rejecting the relief to the appellant u/s 54 F of the I.T. Act 1961. The said relief may please be granted to the appellant. 3. The various reasons given by the learned Assessing Officer as well as the learned C.IT. [A] in rejecting the claim of the appellant u/ s 54 F the I.T. Act 1961 being patently illegal, bad in law, arbitrary, perverse and devoid....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... M/s. Nakoda Buildcon for a total consideration of Rs. 1,10,00,000/-. On 12.07.2011 assessee had booked four flats for Rs. 1,03,60,000/- on the first floor of the project of M/s. Sairaj Builders and Developers and the allotment letter to this effect was issued by the builder. He submitted that the total cost of four flats were fixed at Rs. 1,03,60,000/- and out of which Rs. 69,14,588/- was paid to the builder upto the date of receipt of allotment letter. By 31.07.2011 which is the due date for filing of return u/s 139(1) of the Act, assessee had paid total consideration of Rs. 69,14,588/-. The balance consideration of Rs. 40,93,000/- towards acquisition of four flats was paid between 01.08.2011 and 12.09.2012 and by 12.09.2012 the entire consideration of Rs. 1,10,07,588/- was paid for the acquisition of the flats. He submitted that the construction of residential project was completed by the Builder and copy of the completion certificate dated 15.03.2013 is placed at Page 21 of the Paper Book. He submitted that on 19.03.2013 assessee had entered into registered agreement towards the purchase of four flats. Assessee had filed return of income u/s 139(4) of the Act on 19.03.2013 and....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ew house should be acquired solely and exclusively in the name of assessee. He also placed reliance on the following decisions wherein it has been held that when the entire amount has been invested by the assessee, then deduction cannot be denied solely on the ground that the name of the son of the assessee was also added in the Purchase Deed as joint owner. i) Director of Income Tax (IT) Vs. Jennifer Bhide [349 ITR 80 (Kar)] ii) Vishwasrao M. Patil Vs. ITO [ITA No.1563/PUN/2012] dated 22.01.2016. 9. With respect to the Revenue's contention that since the assessee had sold the original asset on 20.04.2010, the time limit of two years to purchase new house was 20.04.2012 and since the assessee had acquired the new house vide agreement dated 19.03.2013 i.e., after the stipulated time, the assessee is not eligible to claim deduction u/s 54F of the Act, he submitted that the new flats were booked by the assessee vide allotment letter dated 12.07.201 with the builder when the building was under construction and the entire payment was made by September, 2012. He submitted that the commencement certificate for the impugned project was 06.01.2011 whereas the completion certificate wa....
X X X X Extracts X X X X
X X X X Extracts X X X X
....come to the rescue of the Department and on the contrary, it favours the assessee as the facts are distinguishable because in that case assessee had filed return u/s 139(1) of the Act and the un-utilized amount of capital gains was not invested by the assessee in the Capital Gain Account Scheme before filing of such return. In the present case, he submitted that assessee had filed the return of income u/s 139(4) of the Act and the entire amount of sale consideration was utilized for investment in construction of new house before the filing of return u/s 139(4) of the Act. He further submitted that in the aforesaid decision in Para 6 sub-para (v) and (w), the Hon'ble High Court had expressed its agreement with the view taken by the Hon'ble Gauhati High Court in the case of Rajesh Kumar Jalan (supra). He further submitted that the distinguishing factor in the case of Humayun Suleman Merchant (supra) vis-à-vis and Rajesh Kumar Jalan (supra) has also been noted by the Hon'ble ITAT Pune in the case of Ramrao D. Pimple Vs. ITO in ITA No.473/PN/2015 dated 30.10.2017. He also placed on record the copy of the aforesaid decision. He therefore, considering the aforesaid submissions....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ire investment. We further find that Hon'ble Delhi High Court in the case of CIT Vs. Gita Duggal reported in (2013) 357 ITR 153 has held that the fact that residential house consists of several independent units cannot be the reason for denying the claim of deduction u/s 54/54F of the Act. 13. As far as the issue of purchasing flats in joint name is concerned, it is the assessee's contention that the entire consideration towards the purchase of flats was invested by the assessee and no amount was contributed by her son and further the name of the son was included as joint owner to avoid legal complication as the assessee is an old lady. The aforesaid submissions have not been controverted by the Revenue. We find that Hon'ble Karnataka High Court in the case of DIT Vs. Mrs. Jennifer Bhinde reported in (2012) 349 ITR 80 has observed that to attract Sec.54 and Sec.54EC of the Act, what is the material is investment of sale consideration in acquiring the residential premises or constructing a residential premises or investing the amounts in the bonds. It further observed in the entire section of 54, the requirement that purchase to be made or the construction to be put up by the asses....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... three properties in August, 2012 i.e. after due date for furnishing return of income u/s. 139 (1) of the Act had elapsed. The Assessing Officer rejected assessee's claim of exemption in respect of aforesaid investment for the reason that as per the provision of section 54B(2), the assessee should have invested/deposited the amount before the due date for fur the due date for furnishing return of in nishing return of income under s come under sub-section section (1) of Section 139 of the Act. 9. The Hon'ble Gauhati High Court in the case of CIT Vs. Rajesh Kumar Jalan (supra.) while considering assessee's claim of exemption u/s. 54 where the assessee had deposited unutilized portion of capital gain in the specified scheme after the stipulated time for furnishing return of income u/s. 139(1) of the Act has expired held: "6. From a plain reading of sub-s (2) of s. 54 of the IT Act, 1961, it is clear that only s. 139 of the IT Act, 1961, is mentioned in s. 54(2) in the context that the unutilized portion of the capital gain on the sale of property used for residence should be deposited before the date of furnishing the return of the income-tax under s. 139 of the IT Act. Sec. 1....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ar commencing on the 1st day of April, 1988 or any earlier assessment year, the reference to one year aforesaid shall be construed as a reference to two years from the end of the relevant assessment year." 11. A reading of the aforesaid sub-section would show that if a person has not furnished the return of the previous year within the time allowed under sub-so (1) i.e., before 31st day of July of the assessment year, the assessee can file return before the expiry of one year from the end of the relevant assessment year. 12. The sale of the asset having taken place on 13th Jan., 2006, falling in the previous (sic-assessment) year 2006-07, the return could be filed before the end of relevant asst. yr. 2007-08 (sic-2006-07) i.e. 31st March, 2007. Thus, sub-so (4) of s. 139 provides extended period of limitation as an exception to sub-so (1) of s. 139 of the Act. Sub-so (4) is in relation to the time allowed to an assessee under sub-so (1) to file return. Therefore, such provision is not an independent provision, but relates to time contemplated under sub-so (1) of s. 139. Therefore, such sub-so (4) has to be read along with sub-so (1). Similar is the view taken by the Divis....
X X X X Extracts X X X X
X X X X Extracts X X X X
....income is admittedly filed on 4th November, 1996. In terms of Section 54F(4) of the Act as interpreted by the Gauhati High Court in Rajesh Kumar Jalan's case (supra.) the amounts subject to capital gain on sale of the capital asset for purpose of exemption, has to be utilized before the date of filing of return of income. In this case 4th November, 1996 is the date of filing the return of Income. It is not disputed that on 4th November, 1996 when the return of income was filed, the entire amount which was subject to capital gain tax had not been utilized for the purpose of construction of new house nor were the unutilized amounts deposited in the notified Bank Accounts in terms of Section 54F (4) of the Act before filing the return of income. It is also to be noted that in line with the interpretation of Gauhati High Court on Section 54F(4) of the Act, the Assessing Officer had taken into account all amounts utilized for construction of a house before filing the return of income on 4th November, 1996 for extending the benefit of exemption under Section 54F of the Act. Therefore, in the present facts, the decision of the Gauhati High Court in Rajesh Kumar Jalan's case (supra....