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TMI Blog2015 (11) TMI 1269X X X X Extracts X X X X X X X X Extracts X X X X ..... per allotment conditions. See A.Suresh Rao vs. ITO [2013 (4) TMI 743 - ITAT BANGALORE] Thus the assessee was holding the land in question from the date of allotment on 14/2/2001 and consequently the capital gain arising from the sale of the property on 16/9/2014 would be LTCG. Accordingly, orders of the authorities below qua the issue are set aside and the claim of the assessee being LTCG is allowed. Since the AO as well as the CIT(A) have treated the capital gain arising from sale of the property in question as STCG, therefore, the issue of claim u/s 54F has not been examined by the authorities below. Accordingly, in the facts and circumstances and in view of our finding on the nature of capital gain, being LTCG, the AO is directed to examine and decide the claim of deduction u/s 54F. - Decided in favour of assessee. - ITA No. 490/Bang/2014 - - - Dated:- 23-9-2015 - Shri Abraham P George, Accountant Member And Shri Vijay Pal Rao, Judicial Member For the Appellant : Shri Chavali Narayan For the Respondent : Shri Sunil Kumar Agarwala, JCIT(DR) ORDER Per Vijay Pal Rao, JM This appeal by the assessee is directed against the order dated 28/01/2014 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 001 to 28/4/2001. Subsequently, assessee sold the above land on 6/9/2004 for a consideration of ₹ 55 lakhs and worked out the LTCG of ₹ 22,45,562/-. The assessee invested the entire consideration arising from sale of the land in question in a new residential house and claimed exempt u/s 54F of the IT Act. The Assessing Officer (AO) rejected the claim of the assessee on the ground that capital gain derived by the assessee is STCG because the actual date of acquisition of the property in question is the date on which conveyance deed registered on 23/9/2002 and not the allotment date i.e. 14/2/2001 or the payment date i.e. 28/4/2001. Thus, the AO held that the sale of the property in question on 6/9/2004 is within three years from the date of acquisition i.e. 23/9/2002 and accordingly, treated capital gain on sale of the property as a STCG. 4. The assessee challenged the action of the AO before the CIT(A) and contended that the date of acquisition was the date of auction on 5/2/2001 when the property was acquired by the assessee from the BDA and the entire consideration was paid through bank account between 15/2/2001 and 28/4/2001 as stipulated in the allotment letter o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of three years and the capital gain arising from the sale of the property is STCG. 7. We have considered the rival submissions as well as the relevant material on record. There is no dispute that the assessee has acquired the land viz. site bearing No.159, 4th Cross, Dollars Layout, JP Nagar IV Phase, Bangalore, in an open auction from the BDA on 5/2/2001. Consequent to the successful bidder, allotment letter was issued by the BDA to the assessee on 14/2/2001. As per terms of allotment of the land in question, assessee paid the entire consideration of ₹ 25,13,664/- by 28/4/2001. Therefore, as on 28/4/2001, all the other acts and process of acquisition of land in question were completed except registration of the conveyance deed. Since the assessee was allotted the land in question subsequent to the open auction and was issued allotment letter dated 14/2/2001 subject to the payment of consideration which the assessee paid by 28/4/2001 therefore, the date of acquisition would be when the assessee performed his part and complied with terms and conditions of allotment. The capital gain is treated as LTCG if the said asset is held by the assessee held by the assessee for more t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upra) that, facts should be viewed in natural perspective, having regard to the compulsion of the circumstances of a case. Too hyper technical or legalistic approach should be avoided in looking at a provision which must be equitably interpreted and justly administered. The Courts should place an interpretation making a benevolent and justice oriented inference and the facts must be viewed in the social milieu of a country. Now in this background, let us see the facts of this case. 16. The assessee was allotted a site on 21.9.1988 in R M V Extension Bangalore The assessee paid a sum of ₹ 1,11,480/- on such allotment He was also put in possession of the property and possession certificate was issued. On compliance, with other legal requirement, a registered sale deed came to be executed on 6.10.2005 in his name. However, the said site was the subject matter of litigation and therefore, when the assessee was not allowed to enjoy the said property in obedience of the orders passed by the courts, the BDA cancelled the sale deed dated 6.10.2005 by executing a deed of cancellation dated 18.9.2007. Thereafter in lieu of the site, which was cancelled, a fresh allotment was made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sum of ₹ 56,03,590/- in terms of Section 54F of the Act and sought an exemption For the balance of ₹ 2,70,296/-, he has paid the long-term capital gain Therefore, the assessee has rightly claimed the benefit of exemption under Section 54EC and 54-F of the Act. 17. In that view of the natter, if we look at the facts in a natural perspective, there is no dishonest or improper motive on the art of the assessee in claiming said exemption. The facts seen from the social milieu of our society, it is in natural course of conduct of any law abiding citizen. When capital gain is accrued in him instead of paying tax to the Government, he has invested the money in the aforesaid manner, which gives him the benefit of exemption from payment of capital gains. He satisfies the requirement of the law. By hypertechnical or legalistic approach, such benefit conferred on an assessee cannot be denied. Very fact that the law encourages an assessee to make such investments to avoid payment of tax, such benevolent provision which is meant for such assesses has to be equitably interpreted and justly administered. 18. In that view of the matter, we do not see any infirmity committed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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