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TMI Blog2017 (1) TMI 1444X X X X Extracts X X X X X X X X Extracts X X X X ..... e u/s.54F of the Act is concerned, it has been affirmed by the High Court that “due date” refers to the “extended due date” u/s.139(4) of the Act. In view of this, we remit the issue in dispute to the file of AO for the purpose of verifying the records, whether the residential building had come into existence within specified period, i.e. three years from the transfer of original asset. The assessee is directed to produce relevant documentary evidence before the AO to show that the residential building had come into existence within three (3) years after the date of transfer of original asset. The AO after verifying the facts, grant necessary deduction in accordance with law. Appeal of the assessee is partly allowed for statistical purposes. - I.T.A.No.1170/Mds./2016 - - - Dated:- 20-1-2017 - SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND Shri Duvvuru RL Reddy, JUDICIAL MEMBER Appellant by : Shri K.G.Raghunath, Advocate Respondent by : Shri Shiva Srinivas, JCIT D.R ORDER PER CHANDRA POOJARI, ACCOUNTANT MEMBER This appeal of the assessee is directed against the order of the Commissioner of Income-tax (Appeals)-15, Chennai dated 04.02.2016 pertaining ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d at Axis Bank (A/c No. 423010100070090) and Indian Bank account (A/c No. 771795055) and all the payments towards the construction of the residential house were issued only from the above mentioned bank accounts. b) The assessee having thus complied with the provisions of Section 54 F, i.e., reinvestment of the sale consideration within a period of three years towards the construction of a residential property ; and as the appellant had also intended to complete the utilisation of the entire sum of ₹ 56,51,000/- towards the new residential house before 31.03.2014, the appellant filed her return of income for the assessment year 2012-13 on 31. 07.2012 as per the provisions of Section 139 of the Income Tax Act, 1961, claiming the entire sale proceeds as exempted income. c) The Learned Assessing Officer, had completed the assessment U/s 143(3) of the Income Tax Act,1961 on 07.10.2014 after making an addition of a sum of ₹ 50,70,180/- from out of the sale consideration, stating the reason that the said sum was not invested in a Capital Gains Scheme, before the date of filing of return on 31.07.2012. d) The Learned Assessing Officer, had also erroneously considered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed compliance with the conditions Us/54 F (4) of the Act. g) The Learned Commissioner of Income Tax (Appeals), did not consider and appreciate the explanations offered and as a result the appeal of the appellant was dismissed and had upheld all the additions made by the Learned Assessing office for a sum of ₹ 50,70,180/- towards the income declared by the appellant, and thus raised an additional tax demand amounting to ₹ 13,72,570/-. h) The ld.A.R pleaded that the assessee seeks justice resulting in deletion of the additions made by the Learned Assessing Officer, on merits. 5. On the other hand, ld.D.R submitted that in this case, the assessee had not deposited unutilized capital gains in the capital gains account scheme before due date of filing the return of income which falls on 31.07.2012 and it is a mandatory condition on the tax payers to deposit unutilized capital gains in the capital gains account. Hence, the AO correctly rejected the claim of assessee and ld.D.R relied on the order of Ld.CIT(A). 6. We have heard both the parties and perused the material on record. In this case, the assessee filed the return of income for assessment year 2012-13 on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or purchase of a new property for filing exemption u/s.54F has held, th due date for furnishing the return of income u/s.139(1) of the Act as subject to the extended period provided u/s.139(4) of the Act, while holding so, the High Court considered the decision of Karnataka High Court referred to in the case of Fatima Bai v. ITO [2009] 32 DTR 243 (Karn) and CIT v. Rajesh Kumar Jalan [2006] 286 ITR 274 (Gauhati) wherein held that:- 10. Having heard learned counsel for the parties, we are of the opinion that sub-section (4) of section 139 of the Act is, in fact, a proviso to sub-section (1) of section 139 of the Act. Section 139 of the Act fixes the different dates for filing the returns for different assessees. In the case of the assessee as the respondent, it is the 31st day of July of the assessment year in terms of clause (c) of Explanation 2 to sub-section (1) of section 139 of the Act, whereas sub-section (4) of section 139 provides for extension in period of due date in certain circumstances. It reads as under : Page No : 0614 (4) Any person who has not furnished a return within the time allowed to him under sub-section (1), or within the time allowed under a noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngs Bank account held with Indian Overseas Bank According to assessee, all the distinctive features of an account opened under Capital Gains Account Scheme, stood satisfied by it though its account was an ordinary Savings Bank. No doubt an account opened under the Capital Gains Account Scheme, has certain restrictive features, setting it apart from an ordinary Savings Bank account. Here the assessee had kept the money in a Savings Bank account on a bonafide belief that its 54EC investment would cover the capital gains liability and there was no further necessity to open a distinct account under the Capital Gains Account Scheme . Nevertheless it had drawn money from such Savings Bank account only for construction of residential house and this has not been rebutted by the Revenue. Hence the restrictive features of an account under Capital Gains Account Scheme , was satisfied by the assessee, though the amounts were held by it in an ordinary S.B. account. Ld. CIT(Appeals) after elaborating on the intention of the legislature in introducing Section 54F in the Act, was of the opinion that just because assessee had failed to deposit the unutilized sums in the specified account, he co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad deposited only in an ordinary Savings Bank account, having made withdrawals therefrom only for the purpose of construction of a house, there was substantial compliance to the procedures. Just because the account was not nomenclatured as an account under Capital Gains Account Scheme, assessee could not have been denied deduction under Section 54F of the Act when he had satisfied all other conditions. In this view of the matter, we are of the opinion that the CIT(Appeals) was justified in giving the deduction to the assessee. No interference is called for. 6.2 Further, Co-ordinate Bench of Mumbai Tribunal in the case of Anil Kumar Omkar Singh Aurora Vs. ITO in ITA No.4648/Mum.2013 vide order dated 06.11.2013 wherein held that:- 6. Only issue involves in this appeal involves in this appeal is as to whether extended period as per section 139(4) has to be considered for the purpose of utilization of amount of capital gain for the purpose of claiming exemption u/s 54F of the Act. The above issue is squarely covered by the decision of Hon ble Punjab and Haryana High Court in the case of CIT V/s Ms. Jagriti Aggarwal (2011) 339 1TR 610 (P H), wherein, Their Lordships have held th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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