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TMI Blog2020 (8) TMI 144X X X X Extracts X X X X X X X X Extracts X X X X ..... one house only whereas some of the courts have taken a view the word a residential house uses under section 54F of the Act does not refer to one residential unit. As decided in favour of assessee in SMT. KG. RUKMINIAMMA [ 2010 (8) TMI 482 - KARNATAKA HIGH COURT] - there was an amendment under the provisions of section 54F of the Act wherein the word a residential house was replaced with one residential house . Such amendment was brought by the Finance Act 2014 which is effective from 1 April 2015 corresponding to assessment year 2015-16. Whether a residential house should be read as one residential house prior to such amendment has been put to rest by changing the language in the provisions of the Act but the same is effective f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts and circumstances of the appellant's case, the learned CIT(A) has erred in not adjudicating the Ground No. 1.1 to 1.3 which are as follows: 1.1 Learned Assessing officer has erred in law by passing the order more particularly when no notice was served upon the assessee but was wrongly served upon one Mahesh Thakur who is not connected with the assessee and a servant of another co-possessioner of the shop. Hence the whole assessment order is nullity. 1.2 The Assessing officer also erred in not providing the copy of inspection report with Annexure and hence the assessment is void ab initio because of non providing of report which is the base of passing the order and disallowing the claim rightly made u/s 54F. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 attached with the memo of appeal. The interconnected issue raised by the assessee is that the learned CIT (A) erred in not allowing the exemption under section 54F of the Act for the two residential units purchased during the year. 3.1 The facts in brief are that the assessee in the present case is an individual and engaged in the business of advancing money on interest. The assessee in the year under consideration has declared long-term capital gain amounting to ₹ 48,45,148/- on the sale of immovable property situated at Block: C, Shop No: G-9, G.F. New Madhepura market Ahmadabad. 3.2 The assessee further has acquired 2 adjacent residential flats bearing number A-1002 A-1003 located at Palm Meadows, besides Palm Plaza, 100 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use . As such the legislature has brought an amendment by the Finance Act 2014 wherein the word a residential house was replaced with one residential house . But such amendment is effective with effect from 1st April 2015 corresponding to assessment year 2015-16 whereas the case on hand relates to the assessment year 2014-15. Accordingly the assessee claimed that he is eligible for deduction/exemption for the investment made in two flats. 6. However, the learned CIT (A) rejected the contention of the assessee by observing that the legislature has used the word a residential house meaning thereby a dwelling unit. Similarly, the legislature has used the word residential house and not the houses. Therefore, the deduction should be limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 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,- 8.1 A plain reading of the above provision reveals that, subject to the conditions as specified under section 54F of the Act, the assessee can claim exemption for the investment made in a residential house. The question arises whether a residential house reads as one residential house. To resolve the controversy, we note that different courts have taken different views. Some of them have interpreted the investment in a residential house as limited to one house only whereas some of the courts have taken a view the word a residential house uses under section 54F of the Act does not re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 which is effective from 1 April 2015 corresponding to assessment year 2015-16. This fact can be verified from the explanatory memorandum to amendment in Finance Act 2014 which reads as under: The existing provisions contained in sub-section (1) of section 54F, inter alia, provide that where capital gains arises from transfer of a long-term capital asset, not being a residential house, and the assessee within a period of one year before or two years after the date of transfer, purchases, or within a period of three years after the date of transfer constructs, a residential house then the portion of capital gains in the ratio of cost of new asset to the net consideration received on transfer is not chargeable to tax. The benefit wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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