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TMI Blog2020 (11) TMI 314X X X X Extracts X X X X X X X X Extracts X X X X ..... identical issue came up for consideration before the Hon'ble Madras High Court in the case of CIT Vs. Coromandel Industries Ltd. [ 2014 (12) TMI 852 - MADRAS HIGH COURT] rom a reading of Section 54EC(1) and the first proviso, it is clear that the time limit for investment is six months from the date of transfer and even if such investment falls under two financial years, the benefit claimed by the assessee cannot be denied. It would have made a difference, if the restriction on the investment in bonds to ₹ 50,00,000/- is incorporated in Section 54EC(1) of the Act itself. However, the ambiguity has been removed by the legislature with effect from 1.4.2015 in relation to the assessment year 2015-16 and the subsequent years Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Notes on Clauses in the Finance Bill 2014 and the Memorandum explaining the provisions in the Finance (No.2) Bill, 2014, have made it abundantly clear without any ambiguity whatsoever that the amendment seeking to remove the ambiguity in this regard will take effect from 1s` April 2015 and accordingly apply in relation to the Assessment year 2015-2016 and the subsequent assessment years. The learned officer has failed to apply her mind to see the issues involved in proper perspective vis-a-vis the decision of the Hon'ble ITAT, Bengaluru in this regard and the Notes on Clauses in the Finance Bill 2014 as well as the Memorandum explaining the provisions thereof as mentioned supra. The appellant therefore requests that in vi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 50 lacs. 54EC 10.04.2013 ₹ 50 lacs. 54F ₹ 36,87,011 According to the learned CIT (Appeals), a sum of ₹ 50 lacs each was invested during F.Ys 2012-13 and 2013-14 respectively. As per first proviso of Section 54EC of the Act, maximum amount allowable as an exemption under Section 54EC is only one financial year is ₹ 50 lacs. Accordingly, he confirmed the order of the Assessing Officer. Aggrieved the assessee, the assessee is in appeal before us. 4. We have heard both the parties and perused the material on record. An identical issue came up for consideration before the Hon'ble Madras High Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g-term specified asset is not less than the capital gain arising from the transfer of the original asset, the whole of such capital gain shall not be charged under section 45 ; (b) if the cost of the long-term specified asset is less than the capital gain arising from the transfer of the original asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of acquisition of the long-term specified asset bears to the whole of the capital gain, shall not be charged under section 45: Provided that the investment made on or after the 1st day of April, 2007 in the long-term specified asset by an assessee during any financial year does not exceed fifty lakh rupees. 7. On a plain reading of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emorandum explaining the provisions in the Finance (No.2) Bill, 2014, which read as under: Notes on Clauses Finance Bill 2014: Clause 23 of the Bill seeks to amend section 54EC of the Income-tax Act relating to capital gain not to be charged on investment in certain bonds. The existing provisions contained in sub-section (1) of section 54EC provide that where capital gain arises from the transfer of a long-term capital asset and the assessee has within a period of six months invested the whole or part of capital gains in the long-term specified asset, the proportionate capital gains so invested in the long-term specified asset out of total capital gain shall not be charged to tax. The proviso to the said sub-section provides that the inv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in such a manner so as to split the investment in two years i.e., one within the year and second in the next year but before the expiry of six months. This resulted in the claim for relief of one crore rupees as against the intended limit for relief of fifty lakhs rupees. Accordingly, it is proposed to insert a proviso in sub-section (1) so as to provide that the investment made by an assessee in the long-term specified asset, out of capital gains arising from transfer of one or more original asset, during the financial year in which the original asset or assets are transferred and in the subsequent financial year does not exceed fifty lakh rupees. This amendment will take effect from 1 st April, 2015 and will, accordingly, apply in relat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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