9911796707
TMI Blog2012 (9) TMI 130X X X X Extracts X X X X X X X X Extracts X X X X ..... ome Tax Act, 1961 (hereinafter referred to as "the Act"). 2. The brief facts of the case are that the assessee filed return of his income relevant to the assessment year 2007-08 on 26.03.2009 admitting total income of Rs. 1,26,720/- and agricultural income of Rs.40,000/-. The case of the assessee was selected for scrutiny and notice under section 143(2) dated 8.9.2009 was issued to the assessee. The assessee had purchased a vacant land jointly with other co-owners on 26.03.1980. The assessee had invested Rs. 23,960/- as his 1/4th share in the purchase of the said property. During the financial year 1981-82, the assessee and the co-owners constructed compound wall on the aforementioned property. The assessee contributed Rs. 37,500/- as his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital gain of Rs. 34,62,736/-. The Assessing Officer also separately initiated penalty proceedings under section 271(1)(c) of the Act against the assessee. 3. Aggrieved against the assessment order, the assessee preferred an appeal before the CIT(A)-I Coimbatore. The CIT(A) discarded the guideline value adopted by the Assessing Officer. The CIT(A) opted to rely on the value fixed by the District Revenue Officer for stamp duty i.e. Rs.53,54,400/-. The CIT(A) after deducting the amount invested in the new residential house being exempted under section 54F of the Act arrived at the net capital gains at Rs.15,84,479/-. The CIT(A) partly allowed the appeal of the assessee. Aggrieved against the order of the CIT(A), the Revenue and the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .Act." 5. On the other hand, the assessee has taken as many as 10 grounds in his appeal assailing the order of the CIT(A). However, primarily there are two grounds, the remaining are supporting grounds. The main grounds of appeal of the assessee are as under:- "2. The CIT(A) erred in holding that the value determined by the stamp valuation authority (Rs. 53,54,400/-) for the sale of the vacant site should be adopted for purposes of determination of capital gains. 6. The CIT(A) erred in not accepting the appellant's claim that he was eligible for exemption from capital gains under section 54F, as the entire (actual) sale consideration was invested by him in the construction of the new residential house before the due date for filing the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... annot be extended to section 54F. When the assessee has invested full value of consideration received for transfer of assets in exempted assets, it is not necessary to levy capital gains tax and consequently, the provisions of section 50C is not applicable. In order to support his submissions, the counsel has relied on the order of the Jaipur Bench of the Tribunal in the case of Gyan Chand Batra Vs. ITO reported as 133 TTJ (Jp) 482 and the order of the Chennai Bench of the Tribunal in the case of B.N. Properties Holdings P. Ltd., reported as 6 ITR (Trib) 1 (Chennai). 7. On the other hand, Shri Vikramaditya and Dr. S. Moharana representing the Department submitted that no such objection was ever raised by the assessee before the Assessing O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e very clear on this count. The assessee had also pleaded that the property should be referred to valuation officer as the provisions of section 50C(2) have not been complied with while adopting the value. The value adopted by the Stamp Valuation Authority is already under lis in appeal. We are of the considered view that the CIT(A) has fairly adopted the value fixed by the District Revenue Officer, Coimbatore. The CIT(A) while partly allowing the appeal of the assessee after granting exemption under section 54F of the Act on investment in new house has come to the conclusion that the assessee is eligible for capital gains tax at Rs. 15,80,479/-. The contention of the learned counsel that the value determined by the District Revenue Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee used the entire amount of capital gains within the previous year relevant to the assessment year under consideration nor the unutilized portion of the capital gains was deposited by the assessee in Capital Gains Account Scheme, 1988, therefore, the assessee is not entitled to the benefit of full exemption under section 54F of the Act. It is an admitted fact that the entire amount of capital gains has been invested by the assessee in the construction of new residential house within the period prescribed under the provisions of section 54F(1) of the Act. Since the assessee has complied with the provisions of the Act within the time frame specified, the assessee is entitled to exemption of the amount invested in the construction of a n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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