TaxTMI 
TaxTMI 
2024 (9) TMI 1957
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....s of which are as under: i) Full Value Consideration of the property sold Rs 3,75,00,001/- ii) Value of property as per stamp valuation authority Rs. 1,14,78,8771- Full value consideration (higher of (i) and (ii) Deductions u/s 48 of IT Act Rs 3,75,00,001/- Cost of acquisition Rs 24,15,633/- Cost of acquisition with indexation Rs 49,12,875/- Expenditure in connection with transfer of property Rs.3,25,000/- Balance Rs.3,22,52,126/- Deduction u/s 54F of IT Act Rs 3,03,74,563/- Actual Long Term Capital gain Rs. 18,87,563/-" 4. He, therefore, asked the assessee to substantiate her case. From the details furnished by the assessee, the Assessing Officer noted that the assessee has sold the property situated at Uruli, Devachi, Haveli, Pune along with two others for a consideration of Rs.11,25,00,000/-. In this transaction, the assessee has received Rs.3,75,00,000/- (being 1/3rd share of sale consideration). The assessee has purchased one immovable property bearing Plot No.18, admeasuring 334.73 sq. mtrs., carved out of survey No.687/1 along with building standing thereon for consideration of Rs.3,50,00,000/- and claimed the deductio....
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....on u/s 54F of the Act, new property should be either purchased or constructed. Purchase should take place either one year prior to the transfer or within two years from the date of transfer of the capital asset. In case of construction, construction should take place within three years from the date of transfer of the capital asset. Further, deduction u/s 54F of the Act is not allowable in case the assessee either owns more than one residential house or purchases/constructs any residential house other than the new asset. Apart from the above no other conditions or restrictions have been prescribed for allowing or disallowing the claim of exemption u/s 54F of the Act. Thus, the relationship between the buyer and seller of the property is immaterial for allowing the exemption claimed by the assessee. Further, there is no explicit restriction in section 54F of the Act regarding the investment in the property purchased from spouse. That being the case, there cannot be any reason to deny the appellant's claim of exemption u/s.54F of the Act since the appellant had satisfied all the conditions prescribed therein. Therefore, the AO was not justified in disallowing the appellant's ....
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....is allowed." 7. Aggrieved with such order of CIT(A) / NFAC, the Revenue is in appeal before the Tribunal by raising the following grounds: i) On the facts and in the circumstances of the case and in law, the Id. CIT(A) erred in holding that the assessee is entitled to claim deduction amounting to Rs.3,03,74,563/- u/s 54F of the Income Tax Act, 1961 ii) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that there was transfer of capital asset held by the HUF in favour of Shri Vijaykumar Satyanarayan Agarwal, husband of the assessee upon assignment of rights held by the assessee when there is no discussion in the order of the CIT(A) on the documentary evidence regarding assignment of such rights and when no consideration was admittedly received by the assessee against assignment of such rights. iii) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in not appreciating that in the absence of valid transfer of rights of the assessee in the capital asset in favour of Shri Vijaykumar Satyanarayan Agarwal, husband of the assessee, the claim of transfer of the capital asset remained u....
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.... 1.2 The CIT (A) vide his order dated 11/07/2023 held that the relationship between the buyer and seller of the property is immaterial for allowing the exemption claim by the assessee and that there was no explicit restriction section 54F of the Income-tax Act, 1961 regarding the investment in the property purchased from spouse. That, accordingly, there could not be any reason to deny the Appellant's claim for exemption u/s 54F. In view of the aforesaid logic, the CIT (A) allowed the appeal of the assessee and deleted the addition made pertaining to disallowance of claim u/s 54F amounting to Rs.3.03 crores. 2. Say of the Department: 2.1 The investment made by the assessee in a residential house claimed to be belonging to her husband would require that there should be evidence on record that the assessee's husband owned the said residential housing question. Ownership of the said residential house was claimed to have been obtained by the assessee's husband by virtue of an assignment deed dated 28/07/2011 This deed was never brought on record. The CIT (A) did not appreciate that the very basis for the claim u/s 54F was the assignment deed dated 28/....
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.... 96 to 125 4 A copy of deed of assignment for transfer of property between Vijaykumar Satyanarayan Agarwal HUF and Vijaykumar Satyanarayan Agarwal 126 to 140 10. Referring to the same, he submitted that only item No.4 is the additional evidence which was not filed before the lower authorities. He submitted that the CIT(A) / NFAC after considering the various decisions has taken a view in favour of the assessee and therefore, the same should be upheld and the grounds raised by the Revenue be dismissed. 11. We have heard the rival arguments made by both the sides, perused the orders of the Assessing Officer and the Ld. CIT(A) / NFAC and the paper book filed by both the sides. We find the assessee claimed deduction u/s 54F of the Act towards investment in the residential property purchased from her husband Shri Vijaykumar Satyanarayan Agarwal. Shri Vijaykumar Satyanarayan Agarwal had acquired the said property from his HUF Vijaykumar Satyanarayan Agarwal in which the assessee is also a member. All the members of HUF including the assessee gave consent for transfer of the property between Shri Vijaykumar Satyanarayan Agarwal and Vijaykumar Satyanarayan Agarwal, HUF. We....