TaxTMI 
TaxTMI 
2022 (4) TMI 677
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....ficer ('assessing officer' for short) u/s 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as 'the Act'), vide order dated 28.03.2015. 2. Grounds of appeal raised by the Revenue are as follows:- "(i) On the facts and circumstances of the case and in Law, the Ld. CIT(A) has erred in deleting the addition made by the assessing officer of Rs. 22,55,830/- on account of disallowance of deduction u/s 54F of the Act. (ii) On the facts and circumstances of the case and in Law, the Ld. CIT(A) has failed to appreciate the fact that the assessee had not fulfilled conditions of Section 54F of the Act. (iii) On the facts and circumstances of the case and in Law, the Ld. CIT(A), Surat ought to have uphe....
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....ssessee by the assessing officer, asking the assessee to show cause as to why the claim of deduction u/s 54F for Rs. 22,55,830/- should not be disallowed. On perusal of the computation of income and other relevant material available on record, it was noticed that assessee had claimed deduction u/s 54F amounting to Rs. 22,55,830/- in the year under consideration on the LTCG of Rs. 23,23,238/- computed from sales consideration of Rs. 25,72,800/-. The assessee has also claimed deduction u/s 54F amounting to Rs. 17,75,393/- and investment of Rs. 1,80,000/- u/s 54EC in the subsequent AY 2010-11 for the same property. Therefore, a show cause notice was issued to the assessee asking as to why the claim of deduction u/s 54F for Rs. 22,55,830/- shou....
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....sing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. On the other hand, ld Counsel for the assessee defended the order passed by the assessing officer. We note that assessee has converted his capital asset into stockin- trade and accrued capital gains which he invested in construction of residential unit and claimed exemption under section 54F of the Act. Next year i.e. A.Y 2010- 11, the assessee again converted another capital asset into stock in trade and accrued capital gains. This capital gains was also claimed to be invested in the construction of the same residential unit and deduction under section 54F was claimed. The case was subjected to scrutiny assessment u/s 143(3) for....
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....one residence at the time. In the assessee`s case assessing officer accepted that all the conditions are met. The assessee has explained this in detail before assessing officer vide letter dated 18.02.2015 and the assessing officer has not rebutted it. We note that ld. Counsel relied on the judgment of the Coordinate Bench of ITAT Ahmedabad in the case of DCIT vs Pankaj Chimanlal Patel ITA No.3179/Ahd/2016 dated 12.12.2018 and argued that, the facts are identical and hence the decision of Hon'ble ITAT may be followed. The findings of the Coordinate Bench are as follows: "9. We have carefully considered the rival submissions. The essential controversy in the instant case is whether deduction under section 54F of the Act is avail....
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....he net consideration in respect of the original asset, the whole of such capital gain shall not be charged under section 45; (b) if the cost of the new asset is less than the net consideration in respect of the original asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of the new asset bears to the net consideration, shall not be charged under section 45; [provided that *************** [underline is ours] 10. We find at the outset that the identical issue of allowability of Section 54F of the Act on sale of multiple assets came up for consideration before the co-ordinate bench in the past. Useful reference can be made to Anagha Ajit Panekar (supra); Krishn....
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....elineate further, an incidental situation may also crop up whether capital gains deduction with reference to Section 54F of the Act would apply with respect to a solitary transaction and not on whole of several different transaction of capital assets in the form of equity, mutual fund and so on. If the interpretation of 'any long term asset' as suggested by Revenue is read to mean deduction in respect of only one transaction of transfer is endorsed, it will seriously curtail the application of Section 54F of the Act. Such interpretation would lead to absurd results and requires to be shunned. Significantly, we also notice the use of broader expression 'any' long term asset in distinction to expression 'a' long term asset as used in Section ....