9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (8) TMI 1051 - AT - Income TaxRectification of mistake u/s 254(2) - Exemption u/s 54 - long term capital gains (LTCG) - investment in residential property - assessee had actually effected a purchase of a flat of which construction was in progress - Held that - The date of transfer of the asset giving rise to the capital gains was 15th November, 2012 and the payments made by the assessee to M/s. Aarthik Properties Limited after the said date was 5,00,000/- only. We are therefore of the opinion that lower authorities were justified in restricting the claim u/s.54 of the Act to the amounts paid by the assessee after 15.11.2012. - The Tribunal has analyzed Section 54 of the Act and held that the time period of one year prior to the date of transfer giving rising to the capital gains, was available only for an investment in the nature of purchase of a residential house and not for construction of a residential house. What is rectifiable u/s.254(2) of the Income Tax Act, 1961 is only a glaring and apparent mistake and not one which require long arguments and debates on the issues involved. - Application of rectification rejected - Decided against the assessee.
Issues involved:
Interpretation of Section 54 of the Income Tax Act, 1961 regarding deduction for capital gains on the purchase or construction of a residential house. Consideration of case laws with similar facts. Rectification of Tribunal's order based on the interpretation of the law. Analysis: 1. Interpretation of Section 54 of the Income Tax Act: The main issue in this case revolved around the interpretation of Section 54 of the Income Tax Act, 1961, which provides for a deduction on capital gains arising from the transfer of a residential house. The Tribunal analyzed the specific provisions of the Act which allow for the deduction if a residential house is purchased within one year before or two years after the date of transfer, or constructed within three years after the transfer. The Tribunal examined the language of the statute and emphasized the distinction between purchase and construction of a residential house within the specified timelines. 2. Consideration of Case Laws: The petitioner contended that the Tribunal did not consider relevant case laws with identical facts, including decisions of various courts and the Tribunal. The petitioner cited cases such as Devichand Kanthilal Shah vs. ITO, ACIT vs. P.R. Chockalingam, Sh.Sanjeev Lal vs. CIT, CIT vs. Bharti Mashra, and CIT vs. J.R. Subramanya Bhat, to support their argument for allowing the deduction under Section 54. However, the Tribunal analyzed these cases and found that they primarily dealt with the purchase of flats or properties, not construction, which was the key distinction in the present case. 3. Rectification of Tribunal's Order: The petitioner sought rectification of the Tribunal's order, claiming that the Tribunal had erred in not allowing the deduction under Section 54 for the construction of a residential house within the stipulated timeline. The Tribunal, after considering the arguments presented by both parties, upheld its original decision. It concluded that the lower authorities were correct in restricting the deduction to the amounts paid by the assessee after the date of transfer of the asset giving rise to the capital gains. The Tribunal emphasized that the law only allows for deductions based on specific criteria related to purchase or construction within the prescribed timelines. In conclusion, the Tribunal dismissed the Miscellaneous Petition filed by the assessee, affirming its original decision regarding the interpretation of Section 54 of the Income Tax Act, 1961. The judgment highlighted the importance of adhering to the statutory provisions and the specific conditions outlined for claiming deductions on capital gains related to the purchase or construction of a residential house within the specified timelines.
|
