TaxTMI 
TaxTMI 
2025 (7) TMI 300
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.... the Ld.AR of the assessee brought to our notice that the Revenue appeal is hit by tax effect as per CBDT Circular No.9/2024 dated 17.09.2024 which prescribed the tax effect of Rs. 60 lakhs as the threshold limit to file appeal before the Tribunal and the said Circular directed the Revenue not to file the appeals before this Tribunal, if the tax effect is less than Rs. 60 lakhs; and in this case a perusal of Form 36 filed by the Revenue shows tax effect as only Rs. 55,98,635/- which is less than Rs. 60 lakhs, and therefore, the Revenue's appeal is found to be hit by the aforesaid CBDT Circular and therefore, it is held to be non- maintainable and so, we dismiss the appeal preferred by the department. 4. Having said so, it is noted that the assessee has preferred a Cross- Objection against the directions given by the Ld.CIT(A) while allowing grounds of appeal preferred before him. Now, we will examine it. 5. The brief facts in respect of the Cross-Objection preferred by assessee are that the assessee is an individual who earns income under the head 'salaries, interest & capital gains' and is noted to be the Director of a company named M/s. Shiloh Industries Pvt. Ltd., and in t....
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....Rs. 2,63,82,379/-] the same couldn't have been disallowed on the ground that assessee had started construction two months before the date of transfer of original asset, by relying on various High Court decisions including the jurisdictional Hon'ble Madras High Court in the case of C. Aryama Sundaram v. CIT reported in [2018] 407 ITR 01 (Mad) by observing as under: 5.5 It is not dispute that the appellant spent Rs. 2,63,82,379/- to construct a new building before transferring the property that led to the capital gain. The issue that needs to be addressed is whether the amount spent on construction of new building that occurred prior to transfer of the old building is eligible for exemption under section 54F of the Act. The assessee is required to construct a residential house within three years of the sale of original asset to claim exemption, which is a condition of section 54F of the Act. The section does not specify if the exemption is applicable when a residential house construction starts before the old asset is transferred. Therefore, to determine the issue at hand, it is necessary to rely on the Hon'ble High Courts' interpretation of Section 54F of the Act. ....
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....d within a period of three years after the date of transfer of the residential house. It is not in dispute that the new residential house has been constructed within the time stipulated in Section 54(1) of the said Act. It is not prerequisite of section 54 construction could not have commenced prior to the date of the transfer of the asset resulting in capital gain. If the amount of capital gain is greater than the cost of new house the difference between the amount of capital gain and the cost of new asset is to be charged under Section 45 as the income of the previous year. If the amount of capital gain is equal to or less than the cost of new residential house, including land on which the residential house is constructed, capital gain not be charged". 6.3 Furthermore, the Hon'ble Kerala High Court in the B. Premanandh vs. CIT (2022) 144 taxman.com 194(Ker) held that completion of new residential house within the time specified in section 54 F is the determine factor for eligibility of exemption under that section when the exemption is claimed for construction of new residential house. 7. We note that the Ld.CIT(A) has rightly considered the aforesaid judicial pre....
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.....04.2019 during AY 2020-21, from which, assessee declared LTCG of Rs. 4,45,32,798/- and claimed exemption of Rs. 3,93,40,633/- u/s.54F of the Act. Out of such claim, the AO disallowed Rs. 2,63,82,379/- only because assessee had commenced construction of new asset two months before the date of transfer of shares. In this regard, it is noted that the assessee had commenced making payment to the builder two months prior to the transfer of shares on 02.04.2019 by making payment of Rs. 84,16,879/- on 14.02.2019 and Rs. 1,79,65,500/- on 13.03.2019, [total amount of Rs. 2,63,82,379/-] which was disallowed only because the assessee commenced making payment before the date of transfer of original asset/shares which gave rise to capital gains i.e. 02.04.2019. Such an action as we have found supra has been rightly reversed by the Ld.CIT(A) in the light of the judicial precedents especially the decision of the Hon'ble Madras High Court in the case of C. Aryama Sundaram (supra). Therefore, we concur with the findings of the Ld.CIT(A) that the AO erred in disallowing Rs. 2,63,82,379/- only on the sole reason that assessee commenced construction before transfer of original asset. 10. Now the o....