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TMI Blog2021 (1) TMI 204X X X X Extracts X X X X X X X X Extracts X X X X ..... pose of construction of a residential property within a period of three years from the date of sale of old asset. In the instant case there is no clarity as regards the date of utilization of the amounts apart from ₹ 1,75,83,000. It is also not clear when the assessee had incurred the expenditure of ₹ 10 lakh for registration of the property. The matter needs to be examined by the Assessing Officer. The assessee shall be entitled to exemption u/s 54F of the I.T.Act with regard to utilization of the sale proceeds which are within three years from the date of sale of original asset, in the light of the dictum laid down by the above judicial pronouncements - Appeal filed by the assessee is allowed for statistical purposes. - I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount invested in construction / purchase of a flat. In reply to the A.O. s query, the builder submitted that the assessee had made payment of only ₹ 1,75,83,000 instead of ₹ 1,90,00,000 claimed by the assessee. Therefore, in the assessment order completed u/s 143(3) of the I.T.Act (order dated 28.12.2018), the A.O. recomputed the exemption u/s 54F of the I.T.Act at ₹ 1,43,80,289 as against ₹ 1,55,39,185 claimed by the assessee. Accordingly, the excess exemption claimed of ₹ 11,58,000 was added to the assessee s total income. 4. Aggrieved by the order of the assessment in restricting the claim of deduction u/s 54F of the I.T.Act, the assessee preferred appeal to the first appellate authority. The CIT(A) conf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re unambiguous in this regard. 5. Further, the CIT(A) after extracting the provisions of section 54F of the I.T.Act, held as follows:- In view of the clear and unambiguous provision of the law, the appellant would be entitled to exemption u/s 54F of only so much of the net consideration that was invested in the purchase / construction of the new asset and the appellant cannot claim the benefit of exemption on the unutilized amount which has not been deposited in the capital gains account. The appellant has placed reliance on the decision of the Hon ble Karnataka High Court in the case of CIT v. K.Ramachandra Rao on ITA Nos.494 and 495 of 2013 and 46 and 47 of 2014 dated 14/07/2014. However, the facts of the case were somewhat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omplete investment in the said property. Therefore, it was prayed that the entire claim of deduction u/s 54F of the I.T.Act ought to be granted in the facts and circumstances of the case. 7. The learned Standing Counsel strongly supported the orders of the Income Tax Authorities. 8. I have heard the rival submissions and perused the material on record. The A.O. had restricted the claim of exemption u/s 54F of the I.T.Act for the reason that the assessee had utilized only the sale consideration of ₹ 1,75,83,000 out of the balance sale consideration of ₹ 1,90,00,000 (₹ 2,40,00,000 ₹ 50,00,000) for the construction of a residential house. Accordingly, proportionately exemption u/s 54F of the I.T.Act was allow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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