Tax Deduction Denied: Makeshift Structures on Agricultural Land Not Residential Houses for Capital Gains Relief.

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....The High Court examined whether the assessee had constructed a residential house on agricultural land within the stipulated three-year period from the date of transfer of property to claim deduction u/s 54. The court held that the allowance is available if capital gains from the sale of a residential property are utilized for purchasing a residential property or constructing a residential house, implying raising a construction for inhabitation as a residential dwelling unit. The Inspector's report accepted by the ITAT revealed only makeshift guardrooms made of plywood sheets without electricity or water connection on the site. The court opined that putting together plywood sheets cannot be construed as constructing a residential house. The .........