TaxTMI 
TaxTMI 
2020 (10) TMI 620
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....law, equity, weight of evidence, probabilities, facts and circumstances of the case. 2. The learned CIT(A) is not justified in upholding the disallowance of Rs. 15,41,827/- in respect of the claim made u/s 54F of the Act on the ground that the appellant has not invested the sale proceeds in the capital gains account scheme as required u/s 54F of the Act, under the facts and circumstances of the appellant's case. 3. The learned CIT(A) ought to have appreciated that the appellant had incurred expenditure on registration of the sale deed of Rs. 4,33,200/- on 05/07/2017 and a further sum of Rs. 8,00,000/- on 09/08/2017 for furnishing the new apartment with wardrobes, kitchenette etc., which amount aggregating to Rs. 12,33,200/....
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....towards registration expenses and for doing kitchenette and wardrobe to rooms, etc. The payment made towards expenditure of Rs. 12,33,000 were incurred in July 2017 i.e., after a period of two years from the date of sale of vacant site. 4. The AO in the Assessment Order completed under section 143(3) of the Act (order dated 20.11.2017) had restricted the claim of deduction under section 54 of the Act to Rs. 75,16,405/- proportionately on Rs. 78 lakhs. The AO ignored the expenditure incurred in July 2017 of Rs. 12,33,200/- for the following two reasons: "(i) Even if the assessee's claim was to be admitted the expenditure should have been incurred on or before 14.8.2016 (with in a period of 1 year before or two years after the dat....
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.... AO has worked out the deduction proportionately and allowed to the extent of Rs. 75,16,405/- and in the absence of documentary evidences for having incurred expenditure further the balance amount of Rs. 15,41,827/- was added back. I do not find any infirmity in the findings given by the AO and therefore no interference is needed. The grounds of appeal are therefore not allowed." 6. Aggrieved by the order of CIT(A), the assessee preferred an appeal before the Tribunal. The assessee has filed a Paper Book of 78 pages inter alia, enclosing therein computation of total income, sale deed dated 14.08.2018, written submissions before the CIT(A), judicial pronouncements relied on, copies of the receipt for payment of Rs. 8 lakhs to M/s. Mas Fur....
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.... 523]. 7. Learned DR strongly supported the orders passed by the Income Tax Authorities. 8. We have heard the rival submissions and perused the materials on record. The A.O. had held that assessee had purchased an apartment and not constructed the apartment. Hence, the due date was 2 years (i.e. 14.8.2016) and not 3 years from the date of sale of original asset (Vacant site). Assessee had produced copy of agreement to sale at pages 48 to 61 of the paper book filed. The assessee had entered into a composite agreement with the builder to purchase the undivided share of land and for construction of a residential apartment. The assessee was the original owner of the apartment. The agreement to sell between the assessee and the builder ....
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....tances of the case that assessee had purchased an apartment. On the contrary, it is a case of construction of an apartment when assessee had entered into a composite agreement with the builder to purchase the undivided interest in land and for construction of a residential apartment, therefore, a period of 3 years will have to be applicable and not 2 years as held by the A.O. 9. The other reasoning of the A.O. not to grant deduction u/s 54F of the Act in respect of a sum of Rs. 12,33,200/- was that assessee did not deposit capital gains amount in the capital gains account scheme before the date of furnishing of return of income u/s 139 of the Act. The Hon'ble Jurisdictional High Court in the case of CIT Vs. K. Ramachandra Rao (2015) 277 ....