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TMI Blog2015 (1) TMI 1421X X X X Extracts X X X X X X X X Extracts X X X X ..... e conclusion that the assessee has taken higher value while working out indexation and therefore, he recorded an opinion that the income chargeable to tax has escaped assessment under Section 147 of the Act. Merely because, he addressed a letter to the Sub-Registrar asking him to furnish the particulars would not lead to the conclusion that on the day he issued notice, he had no material to show that the assessee has over valued the asset. Rightly, the authorities have rejected the said contention and the proceedings initiated is valid and legal and do not suffer from any. legal infirmity. Therefore, the first substantial question of law is answered in favour of the revenue and against the assessee. Benefit u/s 54F - it is not in dispute th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee for modification, alterations and improvements of the asset acquired is to be taken note of. Thus, the second substantial question of law is answered in favour of the assessee X X X X Extracts X X X X X X X X Extracts X X X X ..... e and improving kitchen, constructing compound wall and other additions. The said claim was rejected by the Tribunal on the ground that when admittedly, the property, which was purchased by the assessee was habitable, any amounts invested by way of improvement is not liable for the benefit under Section 54F of the Act. Aggrieved by the said order of the Tribunal, the assessee is before this Court. 4. The learned counsel for the assessee, assailing the impugned order contended that the records disclose that after issue of notice under section 148 of the Act and after receiving the reply from the assessee, the assessing authority addressed a letter to the Sub- Registrar to furnish the market value of the property as on 01.04.1981. It shows t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount so invested for acquisition of new asset. 6. In the light of the aforesaid rival contentions, the substantial questions of law that arise for our consideration in this appeal are as under: "(i) Whether, the order of the Appellate Tribunal in arriving at the finding that there was sufficient reasons and material to re-open the assessment, by issue of notice under Section 148 of the Act is sustainable in law? (ii) Whether the Tribunal is right in holding that the appellant is not entitled to make a deduction in respect of additions/alterations made to the property after purchase in order to have a normal living in computing the deduction under Section 54F of the Act, when no such restriction has been provided under Section 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rotecting the property with grill work and attending to other repairs. Section 54F of the Act provides that if the cost of the new asset, which is to be taken into consideration while determining the capital gain, the words used is "cost of new asset" and not "the consideration for acquisition of the new asset". In law, it is permissible for an assessee to acquire a vacant site and put up a construction thereon and the cost of the new asset would be cost of land plus (+) cost of construction On the same analogy, even though he purchased a new asset, which is habitable but which requires additions, alterations, modifications and improvements and if money is spent on those aspects, it becomes the cost of the new asset and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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