TaxTMI 
TaxTMI 
2026 (3) TMI 881
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....g the fact that the flat finally got registered in the name of assessee's sister Ms. Shreya Challagalla and thus allotment letter has no relevance? 3. On the facts and in the circumstances of the case, and in law, whether the CIT (Appeals) is justified in holding that the assessee is eligible for deduction u/s. 54F as ultimate sources of payments made to builder are from assessee's account only through his sister Ms. Shreya Challagalla account and also based on confirmation letter from Ms. Shreya Challagalla without appreciating the fact that there was no mention in the registered purchase deed about the investment made by the assessee nor any declaration that his sister Ms. Shreya Challagalla holding the property in a representative capacity? 4. On the facts and in the circumstances of the case, and in law, whether the CIT (Appeals) is justified in holding that the assessee is eligible for deduction u/s. 54F without appreciating the fact that the assessee is not at all a legal owner of the property as the same got registered in his sister's name and thus equating property as 'purchased' with only payment and not ownership of property? ....
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....cluding the relevant letter of allotment issued by the builder upon payment of advance money of Rs. 65,00,000/-, subsequent payment of purchase consideration from the joint bank account held in the name of the assessee and his father, and also explained that the property had been registered in the name of his sister, Smt. Shreya Challagalla, because of convenience. However, the property has been finally transferred in the name of the assessee vide gift deed dated 20.01.2025, where his sister Smt. Shreya Challagalla has gifted the property in favour of the assessee. 5. The Ld. CIT(A), after considering the submissions of the assessee and also taking note of certain judicial precedents, observed that, the assessee has purchased a new residential house property by paying entire sale consideration from his joint bank account held along with his father and registration of the property has been done in the name of his sister, because he could not travel to India due to his employment in UK. The Ld. CIT(A) further noted that, the property has been finally transferred in the name of the assessee by way of gift deed where Smt. Shreya Challagalla has gifted the property in favour of the a....
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....mvent the disallowances and therefore, the same cannot be considered. The Ld. CIT(A), without appreciating the relevant facts, simply deleted the addition made by the A.O. In this regard, he relied upon the following judicial precedents : 1) Decision of ITAT, Mumbai Bench in the case of Colathur N. Ram Vs. ACIT (2024) 168 taxmann.com 564. 2) Decision of Hon'ble High Court of Bombay in the case of Jobanji Thakor Vs. ITO (2025) 175 taxmann.com 62. 3) Decision of ITAT, Ahmedabad Bench in the case of Rajesh Narendrabhai Patel Vs. ITO (2025) 179 taxmann.com 262. 4) Decision of Hon'ble High Court of Andhra Pradesh in the case of Ganta Vijaya Lakshmi Vs. ITO (2015) 54 taxmann.com 301. 9. The learned counsel for the assessee, Shri V. Naga Prasad and Shri Budda M. Rao Varada, C.A. on the other hand, supporting the order of the Ld. CIT(A), submitted that, the assessee had sold immovable property and purchased a new residential house property and claimed deduction under Section 54F of the Act, as per law. The assessee has also explained the reasons for registration of the property in the name of his sister, Smt. Shreya Challagalla due to his employment o....
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....on cannot be allowed in respect of investment made for purchase of new residential house property, when the property is not purchased in the name of the assessee. Since the assessee has purchased the property in the name of his sister, the A.O. denied deduction claimed under Section 54F of the Act. 11. We have gone through the relevant reasons given by the A.O. to disallow deduction under Section 54F of the Act, in light of certain judicial precedents and also the reasons given by the Ld. CIT(A) to allow deduction claimed under Section 54F of the Act, in light of certain judicial precedents. We have also carefully considered the relevant decisions referred to by the learned Senior A.R. for the Revenue in support of his arguments and various case laws referred to by the learned counsel for the assessee in support of the claim of the assessee. There is no dispute with regard to the legal position in respect of deduction under Section 54F of the Act, where the Courts have given liberal interpretation and held that, even if property has been purchased in the name of spouse or unmarried children, deduction should be allowed as long as the consideration paid for purchase of new reside....