1990 (3) TMI 19

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..... 0,000 and that resulted in a net capital gain of Rs. 29,900. The assessee claimed the benefit of exemption under section 54 of the Income-tax Act, 1961 (hereinafter referred to as, "the Act"), on the ground that another property was purchased from the Tamil Nadu Housing Board for Rs. 24,000. The Income-tax Officer negatived this claim of the assessee on the ground that a portion of the building so .....

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..... dence of the assessee and, therefore, the order of the Appellate Assistant Commissioner deserved to be upheld. That is how the following question of law has been referred to this court for its opinion : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that the assessee is entitled to exemption under section 54 of the Act, in respect of the .....

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..... thin a period of one year before or after the date of the sale of the capital asset, purchased a house property for purposes of her own residence. The only controversy debated before the authorities was the user by the assessee of the house in the two years immediately preceding the date of transfer mainly for purposes of her own or her parents' residence. The factual finding of the Tribunal with .....

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..... sq. ft., indisputably the assessee was in occupation to an extent of 1,053 sq. ft. in the first floor as per the finding of the Tribunal and that cannot be considered not to constitute user by the assessee mainly for purposes of her own residence The underlying principle in section 54 of the Act is that the benefit of that provision should not be lost to the owner of a house merely on the ground .....

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..... ut, and it is, therefore, clearly established in this case that the assessee had used the premises mainly for her residence for the requisite period. Under those circumstances, undoubtedly, the assessee was entitled to claim the benefit of section 54 of the Act, as the decision in CIT v. C. Jayalakshmi [1981] 132 ITR 82 (Mad) would, on the facts of this case, be inapplicable. We, therefore, answer .....

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