9911796707
TMI Blog2014 (11) TMI 727X X X X Extracts X X X X X X X X Extracts X X X X ..... the property sold for consideration of Rs. 1,25,00,000/- on 07.02.2007 ignoring the fact that:- (a) The assessee has purchased property jointly with her son and daughter in law on 28.12.2005 which is beyond one year before the date of sale. (b) The assessee had made two payments of Rs. 5 lacs each on 13.12.2005 and 16.05.2006 with respect to the purchase of new property. (c) The assessee further purchase the undivided shares of her son in the flat for consideration of Rs. 1,10,00,000/- as per agreement dated 20.03.2007 which was also claimed as exempt as with the time prescribed u/s 54 of the I.T. Act, within 2 years from the date of sale of original flat. 2. The appellant prays that the order of the Ld. CIT(A) on the above grounds be s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount 1 546409 18.06.2005 Union Bank of India 1,00,000 2 546410 19.07.2005 Union Bank of India 1,70,000 3 546412 16.12.2005 Union Bank of India 1,00,000 4 700784 08.03.2007 Union Bank of India 50,00,000 5 700786 20.03.2007 Union Bank of India 50,00,000 6 - 30.04.2007 Cash 6,30,000 7 - - Total 1,10,00,000 Thus the total cost of flat to the assessee was Rs. 1,20,00,000/-, which was reflected in her balance sheet as on 31st March 2008 in the following manner. (Rs.) Amount Paid to Vendor of Flat : 10,00,000/- Amount Paid to Gurdeep Singh Bhatia for acquiring his undivided share in said Flat: 1,10,00,000/- 1,20,00,000/- This amount of Rs. 1,20,00,000/- was claimed as deduction u/s 54 on the ground that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rdingly he added the long term capital gain of Rs. 1,14,63,650/-. 5. Before the Ld.CIT(A) the assessee made detailed submissions which have been dealt by the Ld.CIT(A) from pages 6 to 8 of the appellate order. The Ld.CIT(A) after examining the records and the submissions of the assessee held that, so far as the payment of Rs. 5,00,000/- made on 16.05.2006 is concerned the same falls within one year before the date of sale of original flat hence qualifies for exemption u/s 54. Therefore, to the extent of Rs. 5,00,000/- assessee is entitled for exemption and not for entire Rs. 10,00,000 as claimed by the assessee. Further after analyzing the purchase agreement of the flat and other records, Ld.CIT(A) found that Shri Gurdeep Singh, son of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... purchase of new House Property and on further construction on it, Calcutta High Court held that exemption is available in respect of both the amounts, that is to say either purchasing a house property within one year before or acquiring house within 2 years where both the conditions are fulfilled within the time stipulated, the assessee is entitled to relief u/s 54 of the act I have considered the issues carefully and respectfully following the judgments of Hon. High Courts I hold that purchase of undivided share by appellant on 20-03-2007 within stipulated provided u/s 54 from her son in the flat of which she was already part owner amounts to new property and therefore assessee is also entitled to exemption u/s 54 of the act in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in-law, vide agreement dated 28.12.2005 and payment of Rs. 5,00,000/- was made. Another payment of Rs. 5 lakhs was made on 16.05.2006. This payment of Rs. 10 lakhs was claimed as exemption u/s 54, which has been restricted to Rs. 5 lakhs by the Ld. CIT(A). Thereafter the assessee had entered into an agreement with her son Gurdeep Singh Bhatia on 20.03.2007, who was the co-owner, for purchasing his undivided share in the new flat for sum of Rs. 1,10,00,000/-. The payment schedule has already been recorded above. The department's case is that, firstly, the purchase agreement for new flat on was 28.12.2005, which is beyond the period of one year before the date of sale and secondly, the purchasing of undivided share in the flat from the son do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e elder brother. The elder brother had sold one of his house and out of the sale proceeds, paid the consideration to his brothers to acquire their shares in the house. In this context it was held that the elder brother would be entitled to relief u/s 54(1) Similarly the Hon'ble Gujarat High Court in CIT Vs. Chandan Ben Maganlal has held that sale proceeds invested for purchase of interest in the residential house owned by assessee's husband and son amounts to purchase, hence entitled for exemption u/s 54. There are other High Court decisions on this score, which have been referred and relied upon by the Ld.CIT(A). Thus, following the said proposition laid down by the Hon'ble courts, we hold that the reasoning and the conclusion drawn by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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