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TMI Blog2015 (4) TMI 908X X X X Extracts X X X X X X X X Extracts X X X X ..... chose to rely only on the disclosure of asset which were claimed to be wrongly made in the statement of affairs. In our view, the explanation offered by the assessee is bona fide and it has been shown by the assessee that the statement of affairs on which the Revenue placed reliance was not reliable as it contained errors. We are, therefore, of the view that the assessee satisfies all the conditions for grant of exemption u/s. 54F of the Act. We accordingly direct the AO to allow the deduction claimed by the assessee. - Decided in favour of assessee. - ITA No. 440/Bang/2014 - - - Dated:- 13-2-2015 - IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE For the Appellant : Shri V. Srinivasan, C.A. For the Respondent : Dr. P.K. Srihari, Addl. CIT(DR) ORDER Per N.V. Vasudevan, Judicial Member This appeal by the assessee is against the order dated 18.2.14 of the CIT(Appeals), LTU, Bengaluru relating to assessment year 2009-10. 2. The only issue that arises for consideration in this appeal is as to whether the revenue authorities were justified in denying the claim of deduction u/s. 54F of the Act. 3. The facts and circumstances under which the afor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F of the Act was not allowable. In this view of the matter, the AO denied the exemption claimed u/s. 54F of the Act and assessed the long term capital gains of ₹ 53,69,952 to tax in the impugned order. 6. Details of particulars furnished by the assessee referred to above is a statement of affairs as on 31.3.2009 filed before the AO. As per the aforesaid statement, assets side of the statement of affairs disclosed the following three properties:- (1) No.222, No.25, Kaderanahalli Village, Uttarahalli Hobli, Bangalore. (2) No.518, 5th Floor, Malaprabha, Bangalore NGHP, Koramangala. (3) No.228, Kaderanahalli Village, Uttarahalli Hobli, Bangalore. 7. Before the CIT(Appeals), the assessee submitted that the assessee merely derives income from salary and other sources and was filing her returns of income and apart from the same, she was not aware of the income-tax proceedings. During the course of the assessment proceedings, when the learned A.O. called upon her to produce details, she had placed the matter in the hands of her Advocate/Tax Practitioner for necessary action. It appears that the Advocate/Tax Practitioner of the assessee produced certain details, but, h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he property No.222, Kadirenahalli Village, which was given as gift in favour of daughter, Ms. Rishma Sidra born on 11.4.2001; and the other in respect of oral gift (Hiba) of the property bearing No.228, Kadirenahalli Village, in favour of daughter, Ms. Ridha Fathima born on 5.7.2008. Both these affidavits were sworn to by the assessee on 18.8.2008. The contents of the affidavits are common. It is necessary to reproduce the manner and the time in which the gifts were made as stated in the affidavit. The relevant portion in this regard reads as follows:- 2. That out of natural love and affection, I have earlier today, in the presence of the witnesses; mentioned hereunder made a HIBA of the Schedule property to my daughter Ms.Rishma Sidra, minor born on 11.04.2001 (hereinafter referred to as the said Donee ) and on behalf of my minor daughter, my husband and myself as the natural guardians of the minor child, have accepted the HIBA. 3. That the said Donee is also signing this declaration in token thereof for having accepted the HIBA in the presence of the witnesses below. 4. That I have simultaneously delivered vacant possession of the schedule property to the said Donee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of filing the statement of affairs including the properties gifted, cannot be lost sight of. He also referred to the fact that assessee has filed wealth-tax returns including the aforesaid properties as part of her wealth. 14. The above observations regarding wealth tax returns is factually incorrect. As we have already seen, the CIT(Appeals) called for a remand report from the AO. In the remand report, the AO has observed as follows:- .7. It is also pertinent to mention here that as per Section 4(1) of the Wealth Tax Act - in computing the net wealth of an individual, there shall be included as belonging to that individual, the value of assets, which on the valuation date, are held by the minor child not being a minor child suffering from any disability of the nature specified in section 80U of the I. T. Act or a married daughter of such individual. In this case, the assessee has not filed wealth tax return nor included the assets held by the minor child in the assessee s name. 15. The above observation in the remand report was misconstrued by the CIT(Appeals) as a submission by the AO that the properties that were included as part of net wealth by the assessee in he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Transfer of Property Act r.w. section 17 of the Registration act, 1908. 21. As we have already seen, this is not the correct position in law. As far as gift in question is concerned, the requirements of a valid gift as per Mohammedan Law are duly satisfied inasmuch as there has been a declaration of gift by the donor and acceptance of gift by the donee and delivery of possession. The delivery in this case would only be constructive. It is also seen that the gift in question was an oral gift made on 18.8.2008. The gift was not made in writing. An oral gift already made was reduced to writing at a later point of time on the same day i.e., on 18.8.2008. This would be clear from a reading of the affidavit filed in confirmation of oral gift, which we have already extracted in the earlier part of this order. Therefore, the gift in question satisfies all the requirements of law and has to be held as valid in law. Since the gifts are held to be valid, the assessee cannot be regarded as owner of the property No.222 and 228 of Kadirenahalli Village. Therefore, the assessee will be the owner of only one property viz., No.518, 5th Floor, Malaprabha, Koramangala, Bangalore. Apart from ..... X X X X Extracts X X X X X X X X Extracts X X X X
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