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TMI Blog2019 (12) TMI 762X X X X Extracts X X X X X X X X Extracts X X X X ..... e has also received a residential flat. That being the case, the assessee is certainly entitled for deduction under section 54 of the Act. Merely because the assessee claimed a deduction under the wrong provision, his claim cannot be disallowed if it is allowable under a different provision. While admitting the additional ground raised by the assessee being purely a legal ground which can be decided without requiring investigation into fresh facts, we direct the AO to allow assessee s claim of deduction under section 54 of the Act in respect of the second flat. Additional grounds are allowed. Consequently, the ground raised by the assessee claiming deduction under section 54F of the Act having become redundant is dismissed. - ITA no.18 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the housing society and M/s. Nav Durga Construction Co. on 19th November 2005, for re development of the property. As per the terms of the said development agreement, the assessee received two new flats being flat no.B 2/1001 and flat no.B 3/101, against surrender of the old flats being flat no.B 6 and B 15 respectively. As against surrender of flat no.B 15 and the new flat received in consequence thereof, the assessee offered capital gain and simultaneously claimed deduction under section 54 of the Act in the return of income. Insofar as the new flat received in lieu of old flat no.B 6, the assessee neither offered it initially to capital gain nor claimed any deduction under section 54/54F of the Act. Subsequently, in the course of assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntal Authorities, the learned Authorised Representative submitted, there is no dispute that the assessee was the owner of two flats at the time of entering into development agreement and on surrender of these two flats, the assessee received two new flats after re development. He submitted, the flat inherited from the father was used by the assessee as an office, therefore, it was not shown in the books and being thought of as a commercial property assessee neither offered capital gain nor claimed deduction under section 54/54F in the return of income. However, in course of assessment proceedings the assessee filed a letter offering capital gain and claimed deduction under section 54F of the Act. He submitted, since the inherited flat was u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erial on record. Undisputed facts are, the assessee was the owner of two flats in a housing society. One flat was purchased by the assessee himself, whereas, the other one was inherited from his father. Subsequently, the assessee had entered into a development agreement with housing society and the developer and in terms of the said agreement, the assessee surrendered two flats owned by him and in lieu of these two flats received two new flats from the developer. As regards the flat purchased by the assessee himself and the new flat received against that, the Assessing Officer has allowed assessee s claim of deduction under section 54 of the Act. The dispute is only with regard to the second flat inherited from his father. As transpires fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ownership of the second flat, he will not be entitled to deduction under section 54F of the Act. As regards the second aspect of the issue, whether the assessee is entitled to claim deduction under section 54 or 54F of the Act, from the facts on record it is clear that according to the Departmental Authorities, the flat transferred being a residential property, the assessee can claim deduction only under section 54 of the Act. If that is the case, the deduction claimed by the assessee should have been allowed under the correct provision. Merely because the assessee has claimed deduction under section 54F of the Act, by treating the flat as a commercial property, assessee s claim of deduction under section 54 of the Act cannot be disallow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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