9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (7) TMI 1752 - AT - Income TaxEntitled to deduction u/s 54F - investments made in a residential house up to the period mentioned u/s 139(1) or 139(4) - whether the CIT(A) was justified in directing the Assessing Officer to treat 50 cents of land as land appurtenant to the residential house for grant of deduction u/s 54F ? - Held that - In view of the order of the Cochin Bench of the Tribunal (2018 (7) TMI 1640 - ITAT CHANDIGARH) we hold that the assessee is entitled to deduction u/s 54F of the I. T. Act as regards the investments made in a residential house up to the period mentioned u/s 139(4) of the I. T. Act. This ground of appeal of the Revenue is dismissed. Treat 50 cents of land as land appurtenant to the residential house for the grant of deduction u/s 54F - Held that - In the instant case, the assessee after selling the original asset on 15. 06. 2007, had purchased land admeasuring 196.14 cents of land for construction of residential house on 15. 06. 2007. The CIT(A) in the first round of litigation had considered only the cost of 5 cents of land entitled to deduction u/s 54F. On further appeal by the assessee, the Tribunal restored the issue to the AO. The Tribunal held that for the convenient enjoyment of the residential house and having regard to the social status of the assessee to the extent of land of 5 cents allowed by the CIT(A) was not reasonable. CIT(A) in the second round of litigation, had considered 50 cents of land as land appurtenant to the residential house while granting deduction u/s 54F. DR in the written submission had agreed that 50 cents of land taken as land appurtenant thereto was reasonable. Therefore, this issue raised by the Department is dismissed.
Issues Involved:
1. Entitlement to deduction under Section 54F of the Income Tax Act for investments made in a residential house up to the period mentioned under Section 139(1) or 139(4) of the Income Tax Act. 2. Justification of the CIT(A)’s direction to treat 50 cents of land as land appurtenant to the residential house for the purpose of granting deduction under Section 54F of the Income Tax Act. Detailed Analysis: Issue 1: Entitlement to Deduction under Section 54F The primary issue was whether the assessee is entitled to a deduction under Section 54F of the Income Tax Act concerning investments made in a residential house up to the period mentioned under Section 139(1) or 139(4) of the Income Tax Act. The Tribunal referred to its recent order in the case of ITO v. Late Shri K. Sasidharan [ITA No. 56/Coch/2017] and other judicial pronouncements, including decisions from the Hon’ble Guwahati High Court, Karnataka High Court, and Punjab & Haryana High Court. The Tribunal concluded that the assessee is entitled to the claim of deduction under Section 54F for investments made up to the due date of filing the return under Section 139(4) of the Income Tax Act. The Tribunal emphasized that the provisions of Section 54F are beneficial and should be interpreted liberally. It was noted that the assessee sold the capital asset on 01/04/2005 and filed the return of income on 18/07/2006. The investment in the construction of the new building was made on 22/01/2007. The Tribunal remitted the issue to the Assessing Officer (AO) to examine the fulfillment of the conditions under Section 54F during the intermediary period from the date of transfer of the capital asset to the date of actual investment in the residential building. The AO was directed to consider the investments made up to the period mentioned under Section 139(4) of the Income Tax Act. Issue 2: Justification of Treating 50 Cents of Land as Appurtenant to the Residential House The second issue was whether the CIT(A) was justified in directing the AO to treat 50 cents of land as land appurtenant to the residential house for the purpose of granting deduction under Section 54F of the Income Tax Act. The Tribunal noted that the CIT(A) in the first round of litigation had considered only the cost of 5 cents of land entitled to deduction under Section 54F. Upon further appeal, the Tribunal restored the issue to the AO, directing that the extent of land for convenient enjoyment of the residential house, considering the social status and locality of the assessee, should be determined. In the second round of litigation, the CIT(A) considered 50 cents of land as reasonable for the purpose of deduction under Section 54F. The learned DR in the written submission agreed that 50 cents of land taken as "land appurtenant thereto" was reasonable. Consequently, the Tribunal dismissed the Department's appeal on this issue. Cross Objection by the Assessee: The assessee's counsel did not press the grounds raised in the cross-objection during the hearing. Therefore, the cross-objection was dismissed as not pressed. Final Order: The Tribunal dismissed both the Revenue’s appeal and the assessee’s cross-objection. The order was pronounced on the 25th of July, 2018.
|
