TaxTMI 
TaxTMI 
2022 (1) TMI 838
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....ls)-19, New Delhi erred in not allowing deduction u/s 54 of Income Tax Act, 1961 in respect of two residential properties claimed by the appellant despite the fact that provisions of Section 54 of Income Tax Act, 1961 were amended with effect from 1.4.2015 prospectively restricting deduction to be allowed u/s 54 of Income Tax Act to only one residential property. 2.2 That on the facts and circumstances of the case and in law, the Commissioner of Income-Tax (Appeals), 19, New Delhi erred in not allowing deduction u/s 54 of Income Tax Act, 1961 in respect of residential property apartment at EMAAR MGF, T- 12-05-04, Commonwealth Games Village, NH-24, New Delhi acquired by appellant for Rs. 2,35,36,782/- in respect of which sale deed was executed and registered within period of three years from the date of sale of house property despite the fact that appellant had made payment much higher than the Long term Capital Gains earned on sale of residential house property. 2.3 That on the facts and circumstances and in law, the Commissioner of Income- Tax (Appeals), 19, New Delhi erred in allowing deduction u/s 54 of Income Tax Act, 1961 of Rs. 54,05,100/'- in respect of one house....
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.... Amount (in Rs.) 02.05.2012 RTGS 21,79,739/- 02.05.2012 RTGS 3,40,495/- 29.11.2012 Cq. No. 244791 (Registration charges) 4,44,190/- 05.12.2012 Cq No. 100385 (Stamp Duty) 22,20,450/- Total 51,84,874/- 8. The assessee was asked to justify her stand. In her reply the assessee explained that sale deed was executed on 16.01.2013 and she alongwith her husband became owner in respect of EMAAR MGF property on 16.01.2013 and since he purchased of residential property was completed during the assessment year under consideration the assessee was entitled for deduction u/s. 54 of the Act. 9. After considering the submissions of the assessee and referring to the section 54 (2) of the Act the AO was of the opinion that the amount of the capital gain has be invested for purchase or construction of property within specified period and since in the case of the assessee most of the payments have been made and beyond the specified period of one year, therefore, mere execution of sale deed within the period as mentioned in section 54 of the Act is not sufficient and concluded by holding that only Rs. 2592437/- is eligible for exemption in respect of CWG property. 10. In so f....
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....ase of the above property within the time frame specified under section 54. Therefore, Rs. 25,92,437/- i.e. 50% of the above payments being the share of the assessee is eligible for deduction under section 54 in respect of CWG Village property." 15. Since the revenue is not in appeal before us the above findings of the CIT(A) has attained finality. 16. The solitary issue to be decided now whether the assessee is entitled for exemption u/s. 54 of the Act in respect of purchase of two residential house property. We find that this controversy has been considered at length by Hon'ble High Court of Madras High Court in the case of Trilok Chand (supra). The relevant findings of the Hon'ble Madras High Court read as under :- 20. We have discussed about the two decisions from the Karnataka High Court, which, in our opinion, dealt with similar controversy as is raised before us herein. The only difference which we find is that the purchase of the residential houses in the present case is at different address in the same city of Madurai. In D. Ananda Basappa case stated (supra), two flats in question were admittedly adjacent to each other and which were joined to become one residential h....
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....n its true" letter and spirit and, therefore was entitled to the deduction under Section 54 of the Act for the entire investment in the properties and securities. Therefore, in our opinion, Judgment rendered by the Karnataka High Court in u. Ananda Bcisappa (supra) & Khoobchand M.Makhija {supra)c ited at bar by the learned counsel for the Assessee apply on all fours lo the facts to the present case. ' 22. The decision of Punjab and Haryana High Court relied upon by the learned counsel for the Revenue, in which the Division Bench of the said Court finding a distinction with D. Ananda Basapaa case (supra) on facts, without expressing contrary opinion in detail, held that no Substantial Question? 9RlLaw arose, renders little help to the arguments advanced by the learned counsel for the Revenue. 17. The Hon'ble High Court has also considered the amendment brought into the statute by way of explanatory note. The relevant findings of the Hon'ble High court read as under :- 17. The purpose The very need to amend the later part of Section 54(l)"seems to have been to restrict such plurality to be included in word 'a' by inserting word "one residential house" with effect from 01.0....