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2024 (8) TMI 493
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.... Ld. A.O. given effect to the Appellate order vide order dated 23-07-2018 but the same was served upon the assessee only on 19-03-2020 which was during the sudden outbreak of Covid-19 Pandemic period. However the assessee filed its appeal on 12-06-2020 thereby delay of 672 days and requested to condone the delay. The Ld. D.R. filed a report dated 17-04-2024 from the Assessing Officer, however confirms that the giving effect order though was passed on 23.07.2018, there is no proof of date of service of this order to the assessee. Since the assessee also confirms in his Affidavit, pursuant to the recovery action initiated by the Assessing Officer, he came to know about the giving effect order. Thus the explanation offered by the assessee is accepted and the delay of 672 days in filing the above appeal is hereby condoned. 3. The brief facts of the case is that the assessee is an individual and deriving income from Salary, House Property, Capital Gain and Other sources. For the Asst. Year 2013-14, assessee filed its belated Return of Income u/s. 139(1) on 26.03.2014 declaring total income of Rs. 31,71,420/-. The return was taken up for scrutiny assessment and determining the total inc....
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....de in the new property in accordance with section 54F of the Act is entitled for deduction u/s. 54F of the Act. Accordingly, I direct the assessee to furnish the details of investment made in the construction of new residential building after the sale of existing property before the due date of filing of return of income u/s. 139(1) of the Act. The Assessing Officer shall consider that investment made by the assessee in the construction of new property after the sale of existing property in terms of section 54F of the Act. In the result, appeal of the assessee is partly allowed for statistical purposes. 4. In the result, the appeal of the assessee is allowed." 5. Aggrieved against the appellate order, assessee is in appeal before us raising the following Grounds of Appeal: 1.00 Order is Bad in Law. 1.01 On the facts and circumstances of your appellant's case and in law, the ld CIT(A)-4,Vadodara has erred in disposing the appeal in vague manner without appreciating the fact that investment in new property was made as per provisions of section 54F of the Act, further erred in making contrary/confusing statements with respect to allowability of exemption directing Id AO to ....
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....ent of Rs. 77,25,000/- namely cost of the Flat Rs. 25,60,000/- + construction value Rs. 51,65,000/- which is much higher than the Long Term Capital Gain on transfer of original asset, the entire Long Term Capital Gain will be exempt as per Section 54 of the Act, even in a case where the return is filed belatedly but well within the due date prescribed u/s. 139(4) of the Act. 7. Per contra, Ld. D.R. appearing for the Revenue supported the orders passed by the Lower Authorities and requested to uphold the same. 8. We have given our thoughtful consideration and perused the materials available on record. It is undisputed fact that the assessee sold his residential house property for a consideration of Rs. 45,00,000/- on 09.01.2013 which has resulted in Long Term Capital Gain of Rs. 23,17,183/- after applying cost of indexation. Similarly undisputed fact is the assessee purchased new uncompleted flat on 17.02.2014 for a sale consideration of Rs. 25,60,000/- and entered into a Construction Agreement for Rs. 51,65,000/- on 25.02.2014 and the construction cost were paid from 08.12.2011 to 06.02.2014 and the assessee filed its belated Return of Income u/s. 139(4) on 26.03.2014 claiming ex....
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....dential house within three years from the date of transfer of capital asset. We find that the assessee is eligible to claim deduction under this section, even if a new residential house is purchased within one year before the date of transfer of capital asset, which means that assessee has to make use of funds other than the sale consideration of house sold for investing in a residential Flat and it is not mandatory that only the sale consideration of Flat sold is to be utilized for purchasing or constructing a new residential house. In the present case the assessee has utilized other funds (apart from sale consideration) for constructing new residential house and for this reason only he cannot be denied deduction u/s 54 of the Act. 8.3. Further going through the provisions of section 54 of the Act we also observe that there is no mention about the date of start of construction of residential house, but it only refers to a construction of a residential house, which in our view is the date of completion of the constructed residential house habitable for the purpose of residence. 8.4. Next question arise whether the assessee is entitled for claiming exemption u/s. 54 where the retu....
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....aim at all Therefore, the claim of the same is required to be weighed on the second time of Section 54(2) of the Act whether the capital gain has been utilized for the purchase of new asset before the date of furnishing return of income under 139 of the Act. As noted, the legislature in its own wisdom has used the expression Section 139 for purchase etc. of new asset while on the other hand time limit under s. 139(1) has been specified for deposit in capital gain account scheme. When viewed equitably and liberally, the distinction between the two different forms of expression to time limit can yield different results. Section 139 encompasses both Section 139(1) and 139(4) of the Act. There is a normal presumption that words are used in Act of Parliament correctly and exactly and not loosely and in-exactly. In the present case, we are concerned with the utilization of capital gains by purchase of new asset for which the legislature has stopped short by making reference of Section 139 of the Act, in variation to Section 139(1) of the Act referred for deposit in capital gain scheme. This distinction assumes significance for interpretation of a beneficial provision. Thus, a beneficial ....