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TMI Blog2019 (3) TMI 987X X X X Extracts X X X X X X X X Extracts X X X X ..... r has taken three instances, this Tribunal is of the considered opinion that by considering the location and potential for future development, it would easily fetch ₹ 100/- per sq.ft. as on 01.04.1981. Therefore, this Tribunal is unable to uphold the orders of the lower authorities. Accordingly, orders of both the authorities below are set aside and the Assessing Officer is directed to take the market value as on 01.04.1981 at ₹ 100/- per sq.ft. and thereafter recompute the capital gain. Claim of exemption u/s 54F - AO found that the assessee renovated the existing building - Assessee claim before this Tribunal that they have put up an additional construction - HELD THAT:- There was a confusion whether it is renovation of existing building or additional construction as claimed by the assessee or it is improvement of existing building as claimed by the valuation officer. In those factual situation, this Tribunal is of the considered opinion that the matter needs to be reconsidered by the Assessing Officer. Accordingly, the orders of both the authorities below are set aside and the issue of claim of exemption u/s 54F is remitted back to the file of the Assessing Office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us, it not the case of the Revenue that the assessees entered into an agreement for sale or arrangement allowing the purchaser to continue to enjoy the property. In those circumstances, this Tribunal is of the considered opinion that the execution of sale deed and handing over possession pursuant to sale deed would be the date of sale. Therefore, the Assessing Officer shall verify the sale deed and find out when actually the possession of the property was handed over. Accordingly, orders of both the authorities below are set aside and the matter is remitted back to the file of the Assessing Officer - Appeals filed by the assessees are allowed for statistical purposes. - ITA No.1931/Chny/2016 And ITA No.1970/Chny/2016 - - - Dated:- 7-3-2019 - SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER For The Appellants : Shri S. Sridhar, Advocate For The Respondent : Ms. M. Subashree, JCIT ORDER PER N.R.S. GANESAN, JUDICIAL MEMBER: Both the appeals of the two independent assessees are directed against the respective orders of the Commissioner of Income Tax (Appeals), Puducherry, for the assessment year 2008- 09. Sinc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 ft. Having located in a prime location of Cuddalore, according to the Ld. counsel, the Assessing Officer failed to consider the factors which were required to be considered for the purpose of estimating the valuation. Therefore, according to the Ld. counsel, the CIT(Appeals) is not correct in confirming the valuation made by the Assessing Officer. 4. On the contrary, Ms. M. Subashree, the Ld. Departmental Representative, submitted that the Assessing Officer after getting report from the Sub-Registrar, found that the value of the land as on 01.04.1981 is ₹ 1.38 per sq.ft. Since the Assessing Officer followed the value adopted by the Sub-Registrar for registration of property, according to the Ld. D.R., the CIT(Appeals) has rightly confirmed the order of the Assessing Officer. 5. We have considered the rival submissions on either side and perused the relevant material available on record. Valuation of property as on 01.04.1981 has to be made on the basis of the location of the property, potential for future development, availability of infrastructure around the property, access to the infrastructure facilities, etc. In this case, the Assessing Officer has simply followe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecompute the capital gain. 7. Now coming to the claim of exemption under Section 54F of the Income-tax Act, 1961 (in short 'the Act'), Shri S. Sridhar, the Ld.counsel for the assessees, submitted that the assessees have made additional construction in the building. However, the Assessing Officer mistook the claim of the assessees and found that it was only a renovation of existing building. According to the Ld. counsel, the additional construction was made for which the assessees are claiming exemption under Section 54F of the Act. The Ld.counsel submitted that since the Assessing Officer found that it is a renovation of existing building, the matter may be remitted back to the Assessing Officer for reconsideration. 8. On the contrary, Ms. M. Subashree, the Ld. D.R. submitted that the assessees spent the capital gain for renovation of existing building. According to the Ld. D.R., for the purpose of claiming exemption under Section 54F of the Act, the assessees have to invest the capital gain in a new property. Since admittedly, the assessees spent the money for renovation of building, according to the Ld. D.R., the assessees are not eligible for exemption under Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, neither the loan amount nor the interest can be allowed while computing the capital gain. 13. We have considered the rival submissions on either side and perused the relevant material available on record. The assessees along with other co-owners appear to have borrowed loan from REPCO Bank, Pondicherry. While transferring the land, the purchaser of the land paid ₹ 48,22,828/- directly to REPCO Bank towards settlement of loan for releasing the document. The assessees claim that this amount has to be allowed while deducting capital gain. Even though the Revenue claims that it was a commercial loan borrowed by the assessees and other co-owners by mortgaging the property, it is not known the purpose for which the loan was borrowed. Unless the purpose for which the loan borrowed was brought on record, this Tribunal is of the considered opinion that it is difficult to decide whether it is allowable deduction or not. Therefore, this Tribunal is of the considered opinion that the matter needs to be reconsidered. Accordingly, orders of both the authorities below are set aside and the claim of deduction of repayment of loan and interest to REPCO Bank is remitted back to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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