9911796707
TMI Blog1984 (12) TMI 154X X X X Extracts X X X X X X X X Extracts X X X X ..... r consideration is, whether in respect of a converted asset, the exemption is to be restricted to the sum eligible prior to the conversion of the asset or the same is to be allowed to the extent the new asset is entitled to under section 5(1A) after the conversion has taken place. The facts in this regard are briefly as under. 2. The assessee, along with six others, was the co-owner of a property, which was sold for Rs. 15 lakhs on 18-1-1982. The assessee's share in the sale proceeds was Rs. 2,14,286 and the same was deposited in a savings bank account on the same date. Prior to the conversion of the asset, the assessee was eligible to claim exemption under proviso to section 5(1)(iv) to the extent of Rs. 1 lakh. After the asset was conve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 lakh which was the limit of the exemption admissible under section 5(1)(iv) in respect of the asset prior to its conversion and, accordingly, allowed the claim for exemption to the extent of Rs. 1 lakh. 4. Aggrieved with the disallowance of the claim for exemption to the extent of Rs. 1,50,000 the assessee is in appeal before us. Shri Dewani, the learned representative for the assessee, took us through section 5(1A), sub-section (3) of section 5 and the Explanation to sub-section (3) of section 5, which are the relevant provisions having a bearing on the issue. He submitted that, under section 5(1A), the exemption admissible in respect of the assets specified in the clauses mentioned therein is cumulatively a sum of Rs. 1,50,000. Under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been the quantum of exemption admissible, if the old asset had still been in existence. He took pains to point out that there is no reference to any ceiling in this behalf in the Explanation to warrant such an inference by the AAC. We have heard the learned departmental representative. 5. After a very careful consideration of the relevant sections and clauses, we are of the opinion, that the exemption to the extent of Rs. 1,50,000 is admissible in respect of the bank deposit under section 5(1A), read with sub-section (3) and its Explanation. The converted asset is no longer in existence and the asset in respect of which the exemption has been claimed is the bank deposit under section 5(1)(xxvi) and the ceiling of exemption admissible in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the exemption claimed is in respect of the bank deposit and the same under section 5(1A) is eligible for exemption up to Rs. 1,50,000. The measure or extent of the exemption is to be decided with reference to the operative part of the section, namely, 5(1A) and not with reference to a hypothesis as to what the assessee might have got, if the original asset had not been sold. In this view of the matter, we have absolutely no reservation in our mind that the exemption sought is in respect of the bank deposits and the same is eligible up to a ceiling of Rs. 1,50,000 under section 5(1A). Accordingly, we direct the WTO to allow exemption up to Rs. 1,50,000. 6. In the result, the appeal filed by the assessee is allowed. - - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
