2023 (7) TMI 990 - AT - Income Tax

Revision u/s 263 by CIT - exemption u/s 54F - HELD THAT - We find that in the consequential assessment-order framed de novo, the AO has accepted assessee s submissions and again allowed exemption u/s 54F although he has reduced the quantum of exemption so as to set right some calculation-mistake as pointed by Ld. AR. But the fact remains that the AO has accepted the exemption u/s 54F and allowed the same. Faced with this situation, we do not find any grievance subsisting to the assessee from revision-order when the AO has allowed exemption u/s 54F even while carrying out the direction given by PCIT. When it so, the present appeal filed by the assessee becomes infructuous liable to be dismissed.

Summary

Issues involved:
The issues involved in this case are the condonation of delay in filing the appeal and the validity of the revision-order passed by the Principal Commissioner of Income Tax-1 under section 263 of the Income-tax Act, 1961.

Condonation of Delay:
The appeal was delayed by 232 days, with the assessee claiming 289 days. The delay was attributed to the lack of awareness regarding the impugned order passed by the department. The delay was condoned after the assessee's submission that the delay was not due to lethargy, negligence, or malafide intention. The department had served the impugned order electronically, but the assessee had not checked the income-tax portal, leading to the delay. The Tribunal proceeded with the hearing after condoning the delay.

Validity of Revision-Order:
The assessee had claimed exemption under section 54F based on investments made in a residential plot and a deposit in the Capital Gain Deposit Scheme, 1988. The Assessing Officer (AO) had accepted the exemption in the original assessment order. However, the Principal Commissioner of Income Tax-1 found the assessment order to be erroneous as the completion of construction within three years was not verified. The revision-order set aside the assessment order and directed the AO to make a fresh assessment. The assessee argued that even if construction was not completed within three years, it should not affect the exemption claimed for the relevant assessment year. The AO, in the de novo assessment, accepted the exemption under section 54F but corrected a calculation mistake, reducing the quantum of exemption. The Tribunal noted that the AO had allowed the exemption under section 54F in the fresh assessment order. Consequently, the appeal was deemed infructuous and dismissed.