2021 (9) TMI 400

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....n if the assessee has not completed the construction within the period of 3 years and accordingly directed the AO to quantify and allow the expenditure incurred by the assessee on the construction of new house u/s. 54F of the Act. According to him, the new house was not constructed within three years from the date of sale of original asset. Further, the assessee is not entitled for deduction u/s. 54F, since the assessee has not invested the unspent net consideration in the capital gain account scheme before the due date for filing the return of income u/s. 139(1) of the Act. The land on which the new asset was constructed was purchased more than one year prior to date of sale of original asset. 3. Further, the ld. DR submitted that there....

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....ari 60 taxmann.com 74 (Kar) CIT V/S Sambandam Udaykumar 19 taxmann.com 17 PCIT V/S C.Gopalaswamy [384 ITR 307 (Karnataka) Smt. Babitha Kemparaje Urs V/s CIT, Mysore P. SARANAKUMARI V/S ITO, ITA No.325/MDS/2017 7. As per section 54F, assessee has to construct new residential house within the period of 3 years after the date of transfer. If the intention of the assessee is to construct a new residential house and not in a position to complete the same, the assessee then has to deposit the amount into account notified by the Central Govt. for this purpose. In the present case, it was the intention of assessee to construct a new house and in the intermediary period the assessee has to deposit the same into....

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....r violation in support of their arguments. 9. The Hon'ble High Court of Karnataka in CIT v. K. Ramachandra Rao 277 CTR 522 (Karnataka) held as follows:- "4.1 Re.Question No.2 : "As is clear from Sub-section (4) in the event of the assessee not investing the capital gains either in purchasing the residential house or in constructing a residential house within the period stipulated in Section 54F(1), if the assessee wants the benefit of Section 54F, then he should deposit the said capital gains in an account which is duly notified by the Central Government. In other words if he want of claim exemption from payment of income tax by retaining the cash, then the said amount is to be invested in the said account. If the inten....