TaxTMI 
TaxTMI 
2021 (11) TMI 236
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....n facts in not considering fully and properly the submissions made and evidence produced by the appellant with regard to the impugned disallowance. 2.1 The Ld. CIT(A) has grievously erred in law and on facts in confirming the disallowance of exemption of Rs. 1,23,10,660/- u/s. 54F though it was not subject matter of revision or direction by Pr. CIT in his order dated 29.03.2017 and the conditions required for availing the exemption were fulfilled. 2.2 That in the facts and circumstances of the case as well as in law, the Ld. CIT(A) ought not to have upheld the disallowance of exemption of Rs. 1,23,10,660/- u/s. 54F though it was not subject matter of revision or direction by Pr. CIT in his order dated 29.03.2017 and the conditions required for availing the exemption were fulfilled. 3.1 The Ld. CIT(A) has grievously erred in law and on facts in upholding the disallowance of exemption of Rs. 15,97,369/- U/S. 54F of the Act. 3.2 That in the facts and circumstances of the case as well as in law, the Ld. CIT(A) ought not to have upheld the disallowance of exemption of Rs. 15,97,369/- U/S. 54F of the Act. The Ld. CIT(A) has failed to appreciate that th....
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....sideration. He has claimed exemption under section 54 of the Act with respect to the sale of bungalow. Likewise, the exemption under section 54F of the Act was claimed with respect to the sale of land. The necessary details for the exemption claimed under the respective section stand as under: FACTS OF THE CASE RELATING TO EXEMPTION OF LONG TERM CAPTIAL GAIN U/S 54 AS WELL AS 54F ASSTT. YEAR 2012-2013 Date of Purchase Sale Date Amount of Sate Cost Indexed Amount Long Term Capita! Gam Cost of New Property Purchase 1 Paras Bunglow 27-06- 2006 20-12- 2011 2,15,00,000 60,75,500 91,89,340 1.23,10,660 1.70,00.0 00 2 Mudra Land 08-12- 2005 20-12- 2011 18,32,000 1,48,550 2,34,831 15,97,369 TOTAL Rs... 2.33,32,000 62.21.050=00 94,23,971= 00 1,33,08,029= 00 4.4. It was also contended by the assessee that he had two residential properties besides the bungalow which was sold in the year under consideration. One of the residential property was used for factory staff quarters. In other words, such residential property was used as business and also shown i....
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....h respect to exemption under section 54F only. Accordingly the assessee contended that the AO has exceeded his jurisdiction in disallowing the exemption under section 54 of Rs. 1,23,10,600/- claimed on account of sale of Bungalow. The assessee further contended that the provision of section 54 of the Act requires the income from such residential house or building is to be taxable under the head house property. In his case the Bungalow a residential property was not let out. Had the same been let out, the income would have taxed under the head house property. Thus there was no violation of section 54 of the Act occurred. 6.1. The assessee with regard to exemption of Rs. 15,97,369/- claimed under section 54F on account of transfer of land reiterated that other residential property was business assets. Thus he had only one residential house on the date of transfer. 6.2. However the learned CIT (A) also rejected the contention of the assessee and confirmed the order of the AO by observing as under: The original assessment order "has been set aside and AO has been directed to frame assessment order afresh" as can be seen from the concluding para of order u/s. 263 (supra).....
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....or 54F or may be the appellant does not have a case on facts, therefore, trying to scuttle the issue by overemphasizing non-existent legal ground. The issue becomes very clear when appellant himself admits in submission and same is reproduced as under: "(5) On legal ground your appellant argues that Condition of section 54, says " the income of which is chargeable under the head "Income from House Property" That means, if the income received from residential property is chargeable under the head income from House Property then conditions of Section U/s. 54 is fulfilled. "Paras Bunglow " was residential property, it was kept vacant and had it been given on rent then its income would have been taxed under the head " Income from House Property" It equally means if the incomes from property are not taxed under the head "Income from House property " then U/s. 54 is not allowed. e.g. Income from farm house is exempt, Income from property of a trade Union is exempt, Income from installation of Mobile Tower is taxed as income under other sources. The incomes from all the properties will not qualify for exemption U/s. 54." Therefore, admittedly a....
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....in on sale of capital assets invested in specified securities. However, we find that none of the authorities including the principal CIT has disputed that the assessee has claimed the deduction under section 54EA of the Act. Rather the issue revolves for the exemption claimed under section 54 or 54F of the Act. Thus, the statement of income of the assessee does not give any information to decide the issue on hand. 10.3. Moving further, we have referred the show cause notice issued by the AO dated 16th April 2014 during the original assessment proceedings under section 143(3) of the Act and its relevant extract is reproduced as under: Subject: Assessment proceeding u/s. 143(3) in your case for the A.Y. 2012-13 Show cause notice for proposed addition-reg. Please refer to the above. On verification of the statement of income it is seen that you have shown LTCG in respect of sale of Paras Bunglow and Mudra Land of Rs. 1,39,08,029/-. Further, you have claimed exemption u/s. 54 of Rs. 1,70,00,000/- Out of which the exemption u/s. 54F is of Rs. 15,97,369/-. The exemption u/s. 54F is no allowable as you are holding more than one residential property on the dat....
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...., in terms of section 54F of the Act. The Assessing Officer is directed to ensure that adequate and due opportunity of being heard is granted to the assessee. 10.10. On perusal of the direction of the learned principal CIT we find that it was directed to the AO to make a fresh assessment in accordance with the provisions of law in terms of section 54F of the Act. Thus, it was clear that the AO was authorized to make a fresh assessment as per the provisions of law after the necessary verification in terms of section 54F of the Act. 10.11. Without prejudice to the above, we also note that, assuming the assessee has claimed deduction under section 54F of the Act, then it was the duty of the revenue to provide the rightful claim of the assessee which is available under the provisions of law but the same was not claimed by the assessee under the wrong believe. As such, the Revenue cannot take the benefit of the ignorance of the assessee rather it was duty-bound to extend the benefit available to the assessee under the provisions of law. In this connection, find support from the order of coordinate bench of Delhi ITAT in case of Anant Raj Ltd. vs. DCIT reported in [2021] 124 taxman....