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TMI Blog2019 (12) TMI 679X X X X Extracts X X X X X X X X Extracts X X X X ..... e-tax Act, as enunciated under Section 2(47)(vi) and Section 269UA(2)(iii)(f), this Tribunal is of the considered opinion that when the assessee acquired the residential house by means of perpetual lease exceeding twelve years, it has to be construed as acquisition of property / purchase of property within the meaning of Section 54F of the Act. Therefore, the assessee is entitled for exemption under Section 54F of the Act. Hence, this Tribunal is unable to uphold the order of the Principal Commissioner passed under Section 263 of the Act. Accordingly, the impugned order of the Principal Commissioner is quashed. - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... one through the provisions of Section 54F of the Act which reads as follows:- 54F. CAPITAL GAIN ON TRANSFER OF CERTAIN CAPITAL ASSETS NOT TO BE CHARGED IN CASE OF INVESTMENT IN RESIDENTIAL HOUSE (1) Subject to the provisions of sub-section (4), where in the case of an assessee being an individual or a Hindu undivided family, the capital gain arises from the transfer of any long-term capital asset, not being a residential house (hereafter in this section referred to as the original asset), and the assessee has, within a period of one year before or wo years after the date on which the transfer took place purchased, or has within a period of three years after that date constructed, one residential house in India (hereafter in this section referred to as the new asset), the capital gain shall be dealt with in accordance with the following provisions of this section, that is to say,- (a) if the cost of the new asset is not less than the net consideration in respect of the original asset, the whole of such capital gain shall not be charged under section 45 ; (b) if the cost of the new asset is less than the net consideration in respect of the original asset, so much of the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital assets of the previous year in which such new asset is transferred. (4) The amount of the net consideration which is not appropriated by the assessee towards the purchase of the new asset made within one year before the date on which the transfer of the original asset took place, or which is not utilised by him for the purchase or construction of the new asset before the date of furnishing the return of income under section 139, shall be deposited by him before furnishing such return such deposit being made in any case not later than the due date applicable in the case of the assessee for furnishing the return of income under sub-section (1) of section 139 in an account in any such bank or institution as may be specified in, and utilised in accordance with, any scheme which the Central Government may, by notification in the Official Gazette, frame in this behalf and such return shall be accompanied by proof of such deposit ; and, for the purposes of sub-section (1), the amount, if any, already utilised by the assessee for the purchase or construction of the new asset together with the amount so deposited shall be deemed to be the cost of the new asset : Provided that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion or treatment ; or (iva) the maturity or redemption of a zero coupon bond ; or (v) any transaction involving the allowing of the possession of any immovable property to be taken or retained in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882 (4 of 1882) ; or (vi) any transaction (whether by way of becoming a member of, or acquiring shares in, a co-operative society, company or other association of persons or by way of any agreement or any arrangement or in any other manner whatsoever) which has the effect of transferring, or enabling the enjoyment of, any immovable property : Explanation 1.- For the purposes of sub-clauses (v) and (vi), "immovable property" shall have the same meaning as in clause (d) of section 269UA. Explanation 2.- For the removal of doubts, it is hereby clarified that "transfer" includes and shall be deemed to have always included disposing of or parting with an asset or any interest therein, or creating any interest in any asset in any manner whatsoever, directly or indirectly, absolutely or conditionally, voluntarily or involuntarily, by way of an agreement (whether entered into in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstrued as transfer. Of course, this is in the context of purchase of property by Central Government in the case of transfer. In other words, Section 269UA(2)(iii)(f) also defines transfer which includes lease for a term not less than twelve years. In this case, admittedly, the lease was not for less than twelve years. Hence, for all practical purposes, the acquisition of property by perpetual lease exceeding the period of twelve years, has to be construed as purchase within the meaning of Section 54F of the Act. In view of the scheme under the provisions of the Income-tax Act, as enunciated under Section 2(47)(vi) and Section 269UA(2)(iii)(f), this Tribunal is of the considered opinion that when the assessee acquired the residential house by means of perpetual lease exceeding twelve years, it has to be construed as acquisition of property / purchase of property within the meaning of Section 54F of the Act. Therefore, the assessee is entitled for exemption under Section 54F of the Act. Hence, this Tribunal is unable to uphold the order of the Principal Commissioner passed under Section 263 of the Act. Accordingly, the impugned order of the Principal Commissioner is quashed. 8. I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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