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TMI Blog2019 (9) TMI 659X X X X Extracts X X X X X X X X Extracts X X X X ..... ee should be allowed deduction u/s. 54F as claimed by the assessee because investment in purchase of a new residential house made by the assessee is of ₹ 1 Crore and it was made by the assessee on 30.06.2012 whereas the transfer of the original asset took placed on 19.09.2011. There is no dispute on these factual aspects because the same are noted by the AO and there is no observation of the AO that these facts are not correct. - Decided in favour of assessee. - ITA No. 455/Bang/2019 - - - Dated:- 13-9-2019 - Shri Arun Kumar Garodia, Accountant Member And Smt. Beena Pillai, Judicial Member For the Assessee : Shri H. Guruswamy, ITP For the Revenue : Shri R.N. Siddappaji, Addl. CIT (DR) ORDER PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER This appeal is filed by the assessee and the same is directed against the order of ld. CIT(A)-6, Bangalore dated 30.11.2018 for Assessment Year 2012-13. 2. The grounds raised by the assessee are as under. Grounds of Appeal Tax effect relating to each Ground of appeal (see note b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entioned the advance payment of ₹ 1,00,00,000/- invested for purchase of a New property as per the sale agreement dtd: 30-06-2012 without appreciating the fact that the Appellant was not aware as to the statement alleged to have been recorded by the Investigation Authority since a copy of the statement was not provided to the Appellant who has stated the investment as per Sale Agreement dtd: 30-06-2012, but unfortunately it was not mentioned in the statement. Same as above 8.. The Appellant craves leave to add, alter, amend and delete any of the grounds at the time of hearing Total tax effect (see note below) ₹ 27,48,489/- 3. The ld. DR of revenue supported the orders of authorities below whereas the ld. AR of assessee submitted that as per para no. 13 of the assessment order, it is noted by the AO that this is the claim of the assessee that assessee has paid advance of ₹ 1 Crore on 30.06.2012 for purchase of new residential house and this is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... beyond the time limit prescribed u/s 54F. The relevant portion of the submission dated 28/06/2017 is extracted below: The Sale Consideration of the Original Property was required to be appropriated in purchasing a New Assets being a Residential House within the prescribed time limit of 2 years or 3 years as the case may be in the case of the Assessee a Built house was purchased on 24-06- 2016 which was beyond the prescribed time limit of 2 years from the date of Transfer. In this regard the Assessee submits that even though the New Asset was Purchased beyond the Prescribed time limit it would not disentitle the Assessee from claiming the admissible deduction u/s.54F of the Act 4.4 It is seen that the appellant sold a parcel of lard measuring 10.05 Guntas (11,440/- Sq.ft) situated at Sy. No. 60 (60/3), Shettihalli Village, Yeshwanthpur, Bangalore vide absolute sale deed dated 19/09/2011 to M/s Suvilas Properties, a partnership firm for which she received ₹ 85 lakhs as advance in cash and ₹ 20 lakhs by demand draft at the time of signing of the above sale deed. Thereafter, the appellant entered into a sale agreement dated 30/06/2012 wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tire amount of loan borrowed from the Mortgagee Bank. . 12. Whereas the Vendor has assured the Purchaser that he would get the Schedule Property redeemed from the Mortgagee Bank as early as possible and thereafter he has assured that the Registered Sale Deed would be executed in favor of the Purchaser and the limitation of time if any under any law for the time being in force is not an essence of this Contract being the Sale Agreement. If as the appellant has claimed, she had paid ₹ 1 crore to the vendor on 30/06/2012. and the mortgage amount was ₹ 15 lakhs only and further, the vendor had assured the appellant that the mortgage would be redeemed as early as possible, there is no reason why the vendor should have waited 4 years and 9 months to obtain the discharge note from the bank and then get the sale deed registered. 4.6 The claim of the appellant is that by virtue of the agreement for sale dated 30/06/2012 and payment of Rs. One crore, there was a transfer to her of the new property as per the provisions of section 2(47) of the Act. Section 2(47(v) deals with a transfer of immovable property a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... paying all the future taxes, cesses ets., to the Competent Government authorities concerned and from this day onwards the Vendor or his Successors have no manner of any rights, title, interest and claims whatsoever in respect of the Schedule Property. .. 16. The Vendor has this day delivered the peaceful and vacant possession of the Schedule Property along with the relevant original document to the Purchaser and the purchaser has accordingly taken over the delivery of the peaceful possession of the Schedule Property with the relevant original title Deeds. Thus it is very clear that the transfer has taken place only on 24/06/2016 and not on 30/06/2012 as claimed by the appellant. In light of the above facts, the appellant's claim that she had invested the sale consideration in a new property within the time limit prescribed u/s 54F is rejected. 4.7 It is also seen from the assessment record that the appellant had submitted before the ITO(Inv.) Unit-2(1)on 19/06/2015 a statement of computation of capital gain from the sale of land to M/s Suvilas Properties, in whose case a survey u/s 133A had been conducted. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted by ld. CIT(A) that purchase of new asset was completed only on 24.06.2016 which is well beyond the time stipulated for claiming deduction u/s. 54F. In para 4.8 of his order, he has referred to certain judgments of Hon'ble Karnataka High Court. In the light of this factual position, we examine the applicability of the judgment of Hon'ble Karnataka High Court rendered in the case of CIT Another Vs. Sambandam Udaykumar (supra). Para no. 11 of this judgment of Hon'ble Karnataka High Court is relevant and hence, the same is reproduced hereinbelow. 11. Section 45 of the Act makes it very clear that any profits or gains arising from the transfer of a capital asset effected in the previous year shall, save or otherwise provided in sections 54, 54B, 54D, 54E, 54EA, 54EB, 54F, 54G and 54H is chargeable to income tax under the head 'capital gains' and shall be deemed to be income of the previous year in which the transfer took place. The aforesaid sections which form part of section 54 of the Act are cases where capital gain on transfer of capital asset not to be charged in those cases. Section 54F of the Act is a beneficial provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of ₹ 1 Crore for purchase of residential house and only the registered deed was executed after more than 4 years and the possession was also taken after more than 4 years but as per the judgment of Hon'ble Karnataka High Court, the assessee will not disentitled from claiming deduction u/s. 54F of the IT Act. Respectfully following this judgment of Hon'ble Karnataka High Court, we hold that assessee should be allowed deduction u/s. 54F to the extent of ₹ 70,84,063/- as claimed by the assessee because investment in purchase of a new residential house made by the assessee is of ₹ 1 Crore and it was made by the assessee on 30.06.2012 whereas the transfer of the original asset took placed on 19.09.2011. There is no dispute on these factual aspects because the same are noted by the AO also in para 14 of the assessment order and there is no observation of the AO that these facts are not correct. Hence we hold that deduction claimed by the assessee u/s. 54F is allowable and we delete the disallowance. 7. In the result, the appeal filed by the assessee is allowed. Order pronounced in the open court on the date mentioned on the capt ..... X X X X Extracts X X X X X X X X Extracts X X X X
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