TaxTMI 
TaxTMI 
2017 (1) TMI 1762
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....ed:24/08/2007, for a consideration of Rs. 4,25,00,000/-, had thereafter invested part of sale proceeds for purchase of the following residential flat- properties at Powai, Mumbai : Sr. No. Description of the flat purchased Names of the purchasers Purchase consideration Date of purchase deed 1 Flat No. 1508, aple Leaf, Tungwa village, Kurla Taluka (BSD), Andheri (E), Mumbai 1.Mrs.Beena Bhagwan Ramchandani & 2. Mrs.Niharika M. Jhangiani Rs. 83,08,250/- 08.02.2008 Flat. No. 1509, Maple Leaf, Tungwa village, Kurla Taluka (BSD), Andheri (E), Mumbai 1.Mrs.Niharika M. Jhangiani & 2.Mrs.Beena Bhagwan Ramchandani Rs. 83,08,250/- 08.02.2008 The assessee after claiming deduction u/s 54 of the 'Act' as regards the investment made by her towards purchase of the aforesaid two flats, had therein reflected the Net capital gains of Rs. 1,14,87,472/- in her return of income. The A.O being of the view that (i). the assessee had claimed deduction u/s 54 as regards investments made towards purchase of two flat properties, i.e. Flat No. 1508 and 1509, ic. more than one property, and (ii) the respective investments were ....
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....the CIT(A) that though the assesssee was eligible for claim of deduction u/s 54 as regards her investment made in both the flats, for the reason that the said two flats being adjacent were being used as a single residential unit, but being of the view that for the purpose of claim of deduction u/s" 54 of the 'Act', as the ownership of the new residential house could not be divorced from the investment made by the assessee as regards the same, therefore in the backdrop of the fact that as the ownership rights of the assessee in both of the aforesaid Flats No. 1508 and 1509 was only to the extent of 50% of her investment, therefore the deduction u/s 54 was liable to be restricted to the extent of 50% of the total investment of Rs. 1,66,16,500/- made by her. Thus the CIT(A) on the basis of his aforesaid observations, therein relying on the judgment of the Hon'ble Bombay High Court in the case of : Prakash Vs. ITO (2009) 312 ITR 40 (Bom), restricted the claim of deduction of the assessee u /s 54 of the 'Act' to the extent of Rs. 83,08,250/- (i.e. 50% of Rs. 1,66,16,500/-), as against Rs. 41,54,125/- so allowed by the A.O, and as such partly allowed the appeal. 4. The assessee being ....
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....Asstt. CIT 138 ITD 317 (Hyd) 6. ITO Vs. Dr. Vandana Bhulchandani ITA No. 978/Mum/2013 dt-10.08.2016 That the Ld. A.R further in support of his aforesaid contention placed heavy reliance on the judgment of the Hon'ble Karnataka High Court so passed in the case of : DIT Vs. Mrs. Jennifer Bhide (2012) 349 ITR 80 (Karn), wherein the Hon'ble High Court after considering the various provisions of the Transfer-.of property act, 1882, and referring to certain other judicial pronouncements had therein concluded that if an assessee had invested the sale consideration in the purchase of a residential flat, but included the name of some other person without any investment having been made by the latter, then it is the assessee alone who would be entitled towards claim of deduction u/s 54 of the 'Act'. The Ld. A.R further relied on the judgment of the Hon'ble Karnataka High Court in the case of: CIT Vs. D. Ananda Basappa (2009) 309 ITR 329 (Karn) and therein submitted that the Special Leave Petition (for short 'SLP') filed by the revenue against the aforesaid order of the Hon'ble High Court of Karnataka had been dismissed by the Hon'ble Supreme Court in CIT Vs. D. Ananda Basappa (2010)....
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....be gathered as such from a literal interpretation of the aforesaid statutory provision. We are of the considered view that once the long term capital gain (for short 'LTCG) is earned by an assessee, then to dispel the tax liability on such 'LTCG', the scope of the aforesaid statutory provision cannot be stretched to contemplate an investment in the name of a third party, because if that would have been the intention, then the same would have been clearly spelt out by the legislature in all its wisdom in the said statutory provision. The Section 54 does not contemplate the deduction on making of an investment in a property, which is being gifted or transferred. simultaneously with the very making of the investment by the assessee. We are persuaded to observe on a perusal of a literal interpretation of Section 54 that the same contemplates the making of an investment by an assessee in a house property owned by him, and the ownership of such a residential property cannot be divorced from the investment made by the assessee. We are of the considered view that irrespective of the purpose which had prompted the assessee in the present case to include the name of her daughter in the purch....
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.... by the Ld. A.R on the judgment of the Hon'ble High Court of Karnataka in the case of B. Ananda Basappa (supra), and the order of the Hon'ble Supreme Court in CIT Vs. D. Ananda Basappa (2010) 320 ITR (St.) 19, therein dismissing the 'SLP' of the revenue against the aforesaid judgment of the Hon'ble High Court. We have duly perused the order of the Hon'ble High Court of Karnataka, as well as the order of the Hon'ble Apex Court dismissing the 'SLP' of the revenue. We find that the Hon'ble High Court in the case of Ananda Basappa (supra) after referring to the facts of the case, had concluded that where the assessee had purchased two residential flats adjacent to each other, which thereafter were used as a single residential apartment, then no adverse inference as regards the entitlement of the assessee towards claim of deduction u/s 54 could be drawn. We further find that the Revenue had assailed the aforesaid finding of the Hon'ble High Court by way of a 'SLP' before the Hon'ble Apex Court, which was however dismissed. We thus in light of the distinguishable facts involved in the case of Ananda Basaapa (supra) are thus unable to subscribe to the heavy reliance placed by the Ld. A.R ....