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TMI BlogCAPITAL GAINS- exemption u/s section 54X X X X Extracts X X X X X X X X Extracts X X X X ..... CAPITAL GAINS- exemption u/s section 54 X X X X Extracts X X X X X X X X Extracts X X X X ..... ry is that if some one has invested in flat" under construction linked payment plan" will it be considered as" purchase" or is considered as "construction" The allotment letter is issued by the builder at the time of initial payment and the agreement is also entered into. The instalments are asked for as per the progress of construction and the possession will be given on completion of the project ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Reply By GOPALJI AGRAWAL: The Reply: It will be considered as construction as it is not necessary that the assessee undertakes the construction self. Reply By KRISHNAN SURYANARAYANAN: The Reply: The Delhi High Court in the case of Commissioner of Income-tax Vs. Smt. Brinda Kumari [2002] 253 ITR 0343 has held that when amount was advanced to builder for specific purpose of construction of fla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts in new building and the Appellate Tribunal has also held that construction can be treated as construction by assessee that finding of fact is binding on the Court and the Tribunal was right in holding that the assessee was entitled to exemption under section 54(1) of the Act. (a).The following observations were made by the High Court in the judgment - We find substance in the assessee's stand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The Tribunal has, inter alia, recorded a positive finding in the following terms: "In the present case, on the facts, there is no dispute that the late Maharani advanced a sum of Rs. 5,25,000 for the specific purpose of constructing flats for her on third floor of theAkashDeepBuilding. TheAkashDeepBuildingwas constructed after demolishing 9,Hailey Road, which was sold by the late Maharani to An ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sal and Sehgal Properties P. Ltd. If therefore the latter constructed the flats on behalf of the late Maharani with the funds advanced by her, there appears to be no difficulty in treating the construction as the construction made by her. (b). This case, though rendered with reference to provisions of section 54 of the Act, has been digested in view of the principles involved and similarity in pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions between sections 54 and 54F so far as investment in new residential property is concerned. X X X X Extracts X X X X X X X X Extracts X X X X
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