TaxTMI 
TaxTMI 
2022 (7) TMI 1264
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....ned Commissioner of Income Tax Appeal is opposed to law, facts and probabilities of the case. 2. The learned CIT (A) erred in denying exemption U/s 54F as there is no addition of property in the hands of the Assessee since the Co Ownership is converted into Full Ownership by purchasing the share of his brother Mr. Ananda Kumar by investing the capital gains proceeds. 3.The Assessee prays the exemption under Section 54F be allowed by deleting the addition made by the Learned Assessing Officer in the interest of Justice. 4.Further, the Assessee pleads that the Penalty proceedings be kept in abeyance till the disposal of appeal. The Assessee craves permission to adduce further grounds of appeal at the time of hearing....
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....er of original asset, but those properties were let out for commercial purposes and if we exclude those properties, then the assessee does not own more than one house property and consequently, eligible for deduction u/s.54F of the Income Tax Act, 1961. In this regard, the learned A.R has relied upon decision of the Hon'ble Karnataka High Court in the case of Navin Jolly vs. ITO (2020) 424 ITR 462. 5. The learned DR, on the other hand, supporting order of the learned CIT(A) submitted that the Assessing Officer as well as the learned CIT(A) brought out clear facts to the effect that properties owned by the assessee are residential houses even though, same are let out for commercial purposes, therefore, the assessee is not entitled for ded....
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....he record. Before proceeding further, it is apposite to take note to Section 54F(1) of the Act, which is reproduced below for the facility of reference: 54F. (1) Subject to the provisions of sub-section (4), where, in the case of an assessee being an individual or a Hindu undivided family, the capital gain arises from the transfer of any long-term capital asset, not being a residential house (hereafter in this section referred to as the original asset), and the assessee has, within a period of one year before or two years after the date on which the transfer took place purchased, or has within a period of three years after that date constructed, one residential house in India (hereafter in this section referred to as the new asset)....
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....the consideration received or accruing as a result of the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with such transfer. 9. From close scrutiny of section 54F(1) of the Act, it is evident that in order to attract section 54F(1) of the Act, the conditions stipulated in clauses (a) and (b) of proviso to section 54F(1) have to be complied with as the legislature has used the expression 'and' at the end of clause (a) of proviso to section 54F(1) of the Act. It is pertinent to note that under section 22 of the Act any income from any buildings irrespective of which the use which has to be treated under the head income from house property'. It is well settled legal propositio....
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....l property. It is not in dispute that the aforesaid two apartments are being put to commercial use and therefore, the aforesaid apartments cannot be treated as residential apartments. The contention of the revenue that the apartments cannot be taxed on the basis of the usage does not deserve acceptance in view of decisions of Kerala, Delhi, Allahabad, Calcutta and Hyderabad High Courts with which we respectfully concur. 11. Alternatively, we hold that assessee even otherwise is entitled to the benefit of exemption under section 54F(1) of the Act as the assessee owns two apartments of 500 square feet in same building and therefore, it has to be treated as one residential unit. The aforesaid fact cannot be permitted to act as impedim....