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TMI Blog2019 (2) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... e house property at Flat No.3B, First floor, 12 Sham Nath Marg, Civil Lines, Delhi. Along with his wife, he sold the property under sale deed dated 10.4.2008 for Rs. 1.5 crores. In respect of this sale, they have received advance in the month of January or February, 2008. In this process, they have earned the long term capital gains of Rs. 1,35,52,454/-. Out of the sale consideration, they have invested a sum of Rs. 58,55,000/- by way of payment of installment for a construction linked residential house booked in the join name of the assessee and his wife in the project under the name and style of "Omaxe Twin Towers" located at Sector 50, Noida. They have deposited a sum of Rs. 60 lacs and Rs. 39.7 lacs respectively in the "Capital Gains Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s apparent from the fact that the transfer of old property took place on 10.04.2008 whereas the transfer plan prescribes that a sum of Rs. 13,35,000/- and 50% additional charges were to be paid on offer of possession which was an unspecified date after 23.3.2011 and thus it is quite unlikely to be within the time frame i.e. 10.04.2011. Consequently, learned CIT(A) found that the assessee made a payment of Rs. 28 lacs before the sale of the old property and such an amount is not qualified to be deducted u/s 54 of the Act. On this premise, learned CIT(A) confirmed the assessment order and dismissed the appeal. 5. Assessee is, therefore, aggrieved by the orders of the authorities below, and preferred this appeal before us stating that there i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... benefit u/s 54 of the Act on the ground that the new residential house was not complete within three years of sale of the old residential property. Suffice if the substantial investment is made in construction of house and it should be deemed that sufficient steps have been taken satisfying the requirement of Section 54. 8. Per contra, learned DR placed reliance on the orders of the authorities below and submitted that there must be substantial compliance with the law and when the assessee does not prove to have taken sufficient steps for acquiring the property within three years after the sale of the old property, it is not possible to extend the benefit u/s 54 of the Act. 9. We have gone through the record. In so far as the facts are c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) 165 ITR 571, the capital gains arising from the sale of the old house to the extent it got invested in the construction of the new house would be exempt u/s 54 of the Act and Section 54 does not lay down that the construction of the new house must taken after the sale of the old residential house or that the sale proceeds of the old residential house must be used for the construction of the new residential house. Besides this, the law is fairly settled on this aspect that for acquiring the new house, it is not necessary that the assessee must utilize only the sale proceeds of the old house. By respectfully following this line of decision of the higher fora, we hold that the authorities below are not correct in refusing to accept the claim ..... X X X X Extracts X X X X X X X X Extracts X X X X
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