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TMI Blog2019 (11) TMI 929X X X X Extracts X X X X X X X X Extracts X X X X ..... d period. This payment was made to the developer Omaxe Chandigarh Extension Developers Pvt. Ltd. Consequent to that, the developer issued allotment letter and also entered into an agreement dated 05.07.2011. As per the agreement the developer was supposed to hand over the possession of plot within 18 months from the date of allotment letter - developer did not deliver the possession. Hence, the assessee could not complete the construction within the prescribed period of 3 years. This delay in construction was not attributable to the assessee. AO and the CIT (A) have denied the exemption in view of the provision of section 54 and 54F. The AO and the CIT (A) both have ignored the fact that the assessee has made a full payment to the developer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ree years. b) That the Ld. CIT (A) had not considered the fact that the assessee has been allotted a residential plot by the builder, but due to possession of the plot was given by the builder after expiry of three years from date of capital gain hence it was not possible for the assessee to complete the construction before the time stipulated for claiming exemption u/s 54 and 54F of the Income Tax Act, 1961. It is prayed that disallowance of deduction claimed u/s 54F of ₹ 24,12,480/- deduction u/s 54 of ₹ 28,77,944/- is unjustified, unwarranted and bad in law, which is liable to be deleted, be deleted. 1. That the appellant begs leave and reserves the right to alter or add to the grounds of appeal. 2. Facts in brief are that, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truction he submitted that the same could not be done as the developer could not transfer the possession to the assessee despite there being a clear condition in the agreement that the possession will be given within a period of 18 months for the date of the allotment letter. Thus, the reason for delay in construction was beyond assessee s control. It was submitted by the Ld. AR that the total cost was ₹ 63,03,005/- and the same stood paid and hence the assessee had discharged all her obligation. Further, there is no dispute about the fact that the assessee had made investment it is only because of the construction being not done within a period of 3 years, the benefit of section 54/54F has been denied. The Ld. AR placed reliance on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and also entered into an agreement dated 05.07.2011. As per the agreement the developer was supposed to hand over the possession of plot within 18 months from the date of allotment letter. However, the developer did not deliver the possession. Hence, the assessee could not complete the construction within the prescribed period of 3 years. This delay in construction was not attributable to the assessee. Thus, the AO and the CIT (A) have denied the exemption in view of the provision of section 54 and 54F of the Act. Further, the AO and the CIT (A) both have ignored the fact that the assessee has made a full payment to the developer and such payment was more than the amount of the deduction claimed by the assessee. Since, the delay was not on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and, which was done. Thereafter the developer was to handover the plot, so that assessee could have constructed the house within time allowed of 2 years. However, no step could be put forward thereafter because possession of land was not given by the Developer, for reasons beyond the control of the assessee. If an assessee sells his house property and utilises the money for acquiring a plot for the construction of the house and if facts and circumstances point out that assessee intended to construct the house, which has been found so, then it is clear that he wants to avail exemption as provided under the law. Now if the developer after receiving the money could not fulfill the obligation within time, then can assessee be held responsible f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated in the Act, is also very clear that the assessee should be given some relief. Though it has been very often said that common sense is a stranger and an incompatible partner to the Income-tax Act and it is also said that equity and tax are strangers to each other, still this court has often observed that purposive interpretation should be given to the provisions of the Act. In the case of Oxford University Press v. CIT [2001] 3 SCC 359 this court has observed that a purposive interpretation of the provisions of the Act should be given while considering a claim for exemption from tax. It has also been said that harmonious construction of the provisions which sub-serve the object and purpose should also be made while construing any of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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