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TMI Blog2017 (2) TMI 1180X X X X Extracts X X X X X X X X Extracts X X X X ..... cquiring land is on records - Held that:- Though the expenses relate to the construction of a house property. In our considered opinion to claim the exemption u/s.54 of the Act, the assessee has to construct a house property within the stipulated period of time. Obviously, the purchase of land will be either antecedent to the construction or simultaneous to the construction. In any case, the purchases of land do not entitle the assessee for the exemption u/s. 54 of the Act. Therefore, we fail to understand when the land was purchased earlier to the start of construction how this can trigger the provisions of Section 263 of the Act. No merit in the order of the ld. Principal CIT made u/s. 263 - Decided in favour of assessee X X X X Extracts X X X X X X X X Extracts X X X X ..... tion claimed u/s. 54F(4) is not allowable and required to be disallowed. 2. Incorrect allowance of expenditure for new house construction. It is noticed that the expenses related to construction are claimed however no proof of payment made for acquiring land is on records. Therefore, the claim of exemption allowed u/s. 54 of ₹ 41,60,486/- is not correct. 5. Accordingly, statutory notice was issued and served upon the assessee. Calling upon the assessee to show cause why appropriate order u/s. 263 of the Act should not be passed. 6. After considering the submissions of the assessee, the ld. Principal CIT held as under:- 5. I have considered the facts of the case and the submissions made by the AR of the assessee. On verification, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The details of expenses of ₹ 41.60,486/- provided suggest that the new property is not a ready built flat or property, the claim of deduction is towards a property being constructed. As per the exemption claimed for construction of house, it appears that the assessee has not furnished proof of land purchased/owned by her. Further, the assessee has also not filed building use permission. Therefore, it is not certain whether the assessee has constructed the house within two years from the date of sale of the residential property on which capital gain arose. 6. From the above discussion, it is evident that desired enquiry into the entire claim of the assessee has not been done by the Assessing Officer. Consequently, the assessment ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch and every type of mistake or error committed by the Assessing Officer, it is only when an order is erroneous that the section will be attracted. An incorrect assumption of facts or an incorrect application of law will satisfy the requirement of the order being erroneous" 8. Now, let us see in the light of the above ratio whether the assessment has been made on an incorrect assumption of facts or an incorrect application of law. As mentioned elsewhere, the first reason given by the ld. Principal CIT is that the capital gain account shown by the assessee is actually saving bank account. According to the ld. Principal CIT, the assessee could not have deposited the amount in a savings bank account. This proposition of the ld. Principa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Form" means a form appended to this Scheme. 3. Deposits how to be make- A deposit or deposits may be made under the provisions of section 54 or section 54B or Section 54D or section 54F or section 54G of the Act by any depositor intending to avail of the benefit under the said section or sections of the Act, as the case may be, in accordance with the provisions of this Scheme. 4. Types of deposits.- (1) There shall be two types of deposit accounts, namely:- (i) "Deposit account-A" and (ii) "Deposit account-B". (2) The deposit made under account-A shall be in the form of 'savings deposit and subject to the other provisions of this Scheme, withdrawals under this account can be made from time to time by the depositor. 9. As per the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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