TaxTMI 
TaxTMI 
2026 (3) TMI 114
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....ein the assessee has taken the following grounds of appeal: "1) That on the facts and in the circumstances of the case of the appellant and in law Ld. NFAC has erred in upholding the disallowance of exemption claimed u/s. 54 of the Act on sale of residential flat at Rs. 62,31,962/- for A.Y. 2014-15. 2) That on the facts and in the circumstances of the case of the appellant and in law Ld. NFAC has failed to consider that the appellant has duly followed the pre-requisite conditions stated u/s. 54 of the Act and has taken possession of the new flat within 2 years i.e. on 07.01.2015. 3) That the impugned order being contrary to law, evidence and facts of the case may kindly be set aside, amended and modified in the li....
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....i, Kandivali East before filing of income tax return. It was submitted that the assessee booked the new under-construction house vide agreement dt. 23-05-2012 and the construction of the flat was completed on 26-12-2014 and possession was handed over and taken by the assessee on 07-01-2015 i.e., within a period of two years from sale of the property which happened on 28-10-2013. Therefore, the assessee satisfies the requirement of section 54 of the Act and has accordingly claimed exemption u/s 54 while filing his return of income. In this regard, our reference was drawn to the copy of the allotment letter dt. 21-05-2012 issued by M/s. Lokhandwala Nestings Pvt. Ltd., copy of the purchase agreement dt. 23-05-2012, copy of the bank statement r....
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...., 2012 does not amount to purchase of property rather the possession of house property as received in January, 2015 gives the assessee full right to use and enjoy the house property and deduction u/s. 54 of the Act has accordingly been claimed. It was submitted that by mere entering into agreement for purchase of flat, the same does not give any right of ownership till the time all the payments are made and physical possession of the flat is handed over to the assessee and, therefore, the actual right to use the property is acquired after possession is taken by the assessee and in this regard, our reference was drawn to the decision of the Hon'ble Bombay High Court in the case of CIT vs. Smt. Beena K. Jain [1994] 74 Taxman 145 (Bom.HC), whe....
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....in the instant case, the assessee has only made a payment towards booking amount of Rs. 8,77,625/- and the remaining amount was linked to the construction of flat, which has been made over the period of time and, therefore, the assessee did not acquire substantial domain over the new residential flat at the time of entering into the purchase agreement and, therefore, the said decision is clearly distinguishable on facts. 5. Per contra, the Ld.DR has been heard, who has relied on the orders passed by the AO as well as that of the Ld.CIT(A). It was submitted that provisions of section 54 of the Act limit the time period for purchase of new residential house to one year before or two years after the sale of the old residential house and thi....
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....tter of purchase transaction is an under-construction flat in respect of which the consideration of Rs 1,75,52,500/- has been fixed and which is payable in installments, based on construction to be carried out, from time to time. It is therefore not a case of purchase of fully built and ready to move-in flat rather a case of under-construction flat which is to be built over a period of time as part of the overall housing project. At the time of entering into the agreement, the assessee has paid booking amount of Rs 8,77,625/- and the remaining amount has been paid over a period of time, the flat was ready for handing over and possession as part of Builder letter dated 26-12-2014 and the last of the payment has been made and possession taken....