TaxTMI 
TaxTMI 
2023 (11) TMI 741
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..../deduction u/s 54 of the Income Tax Act, 1961. 2. The CIT(A) and the A.O. failed to correctly interpret the amendment made by the Finance Act, 2014, herein the words "a residential house" appearing in section 54 of the Act were changed to "one residential house", thereby making a prospective amendment in the Act, that implied that, prior to the amendment the word "a" in a residential house was a grammatical reference and not a numeric reference, meaning one residential house. 3. The CIT(A) failed to appreciate this amendment and wrongly upheld the A.O.'s action of denying the benefits of the provisions of section 54 of the Income Tax Act, 1961 to the appellant." 3. The assessee has received income from salary, house....
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....14 and before that, investment in multiple houses was permitted. The AR relied upon various decisions in favour of the appellant. The AO was not satisfied with the contentions of the AR and held that exemption u/s 54 of the Act was permitted for investment in multiple units only if those multiple units are amenable to joint enjoyment as a one unit. The ld. CIT(A) affirmed the action of the AO. 7. Aggrieved, the assessee filed appeal before the Tribunal. 8. Heard the arguments of both the parties and perused the material available on record. 9. The ld. AR relied upon the decision of Mumbai ITAT in the case of Ravi Shankar vs. ACIT in ITA No. 3270/Mum/2016 for AY 2012-13. 10. We have gone through the complete facts of the case. It....
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....R. Karpagam. In this case, the assessee had entered into an agreement with the builder and as per the development agreement, the assessee (land owner) parted from land and she was to receive 43.75 per cent of built up area, which was translated to 5 flats. The Hon'ble High Court held that the said five flats in the same building can be construed as a single unit and therefore, exemption u/s 54F can be allowed in respect of these multiple units. The decision was given after relying upon the decision of the Karnataka High Court in the case of CIT v. K.G. Rukminiamma [2011] 331 ITR 211/196. The Hon'ble Chennai High Court has further held in this case that, "9. It is relevant to note herein that an amendment made with regard to the wor....
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....ansaction in this case was not with regard to the number of flats but with regard to the percentage of the built-up area, vis-avis, the Undivided Share of Land." 13. After perusal of the above decisions, it has become clear that the judicial authorities have held that the amendment to section 54/54F whereby the words "a residential house" has been replaced with the words 'one residential house in India' is applicable with effect from 01.04.2015 and prior to the amendment, the earlier legal position will continue to hold. It is also inferred that post amendment, i.e. after 01.04.2015, the exemption u/s 54 will be available only in respect of one residential house in India and not in respect of multiple houses. In fact, a perusal of notes ....
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....need arises, be conveniently and independently used as an independent 'Residence, the requirement of the Section should be taken to have been satisfied. There is nothing in these sections which require the residential house to be constructed in a particular manner. The only requirement is that it should be for the residential use and not for commercial use. If there is nothing in the section which requires that the residential house should be built in a particular manner, it seems to us that the income tax authorities cannot insist upon that requirement. A person may construct a house according to his plans and requirements. Most of the houses are constructed according to the needs and requirements and even compulsions. For instance, a ....