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TMI Blog2018 (11) TMI 511X X X X Extracts X X X X X X X X Extracts X X X X ..... ffective grounds of appeal: "(1) AS REGARDS ASSESSMENT BEING NULL AND VOID That the learned A.O. erred in passing an assessment order u/s. 143(3) without assuming proper jurisdiction by having failed to issue statutory notice u/s. 143(2) of the I.T. Act before proceeding with assessment. 2) AS REGARDS DENIAL OF DEDUCTION U/S.54 OF THE I.T. ACT a) That on the facts and circumstances of the case and in law the learned CIT(A) erred in denying the deduction u/s. 54 of the Act when the Appellant had complied with all the requirements of the said section. b) That the learned CIT(A) failed to appreciate that the Appellant had purchased new asset (residential property) within the time line specified by the section 54 of the I.T. Act. c) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted for scrutiny assessment under Sec.143(2) of the Act. 3. In the course of the assessment proceedings it was observed by the A.O that the assessee had sold an immovable property for a consideration of Rs. 74 lac on 28.03.2013. The 'Long Term Capital Gain' (for short 'LTCG') of Rs. 49,89,213/- on the sale of the said property was claimed by the assessee as exempt under Sec.54 on the ground that she had purchased a new residential property for a consideration of Rs. 78,43,392/-. On the basis of the aforesaid claim, the assessee had reflected the income under the head 'Capital gain' at Rs.nil. It was noticed by the A.O that the assessee had entered into an 'agreement to purchase' the new residential property viz. A- 801, Lodha Luxuria on 29 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ards the same got vested with the assessee. It was the contention of the ld. A.R, that as the possession of the new residential property was delivered to the assessee within the stipulated period of one year before the date of transfer of the property under consideration, hence, her claim for exemption under Sec.54 was in order. It was submitted by the ld. A.R that as the new residential property was not in existence on the date on which the assessee had entered into an agreement for purchase of the new residential property, thus it was incorrect on the part of the A.O to have held the same as the date of purchase by the assessee. The ld. A.R submitted that purchase of new residential property would be substantially effected on the date whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... did not find favour with the A.O. 7. We have deliberated at length on the issue under consideration and find substantial force in the contentions advanced by the ld. A.R before us. Admittedly, though the assessee had entered into an agreement to purchase the new property viz. A-801, Lodha Luxuria on 29.01.2009, but then the possession of the same was delivered to her only as on 18.05.2012. We are persuaded to subscribe to the claim of the ld. A.R that the purchase of new residential property would be substantially effected on the date when the assessee had paid the full consideration on the flat becoming ready for occupation and had obtained possession of the same. In the backdrop of our aforesaid observations, we are of the considered v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had been purchased by the assessee within two years after the sale of the capital asset which resulted in long-term capital gains. The Tribunal has held that the relevant date in this connection is 29-7-1988 when the petitioner paid the full consideration amount on the flat becoming ready for occupation and obtained possession of the flat. This has been taken by the Tribunal as the date of purchase. The Tribunal has looked at the substance of the transaction and came to the conclusion that purchase was substantially effected when the agreement of purchase was carried out or completed by payment of full consideration on 29-7- 1988 and handing over of possession of the flat on the next day." We thus respectfully follow the aforesaid judgmen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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