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TMI Blog2021 (6) TMI 982X X X X Extracts X X X X X X X X Extracts X X X X ..... new house within two years from the end of the relevant financial year as specified u/s 54F of the act. Though the assessee has not made the deposit in specified account, it is observed form the order of the AO that the assessee has made the deposit in the bank account and used the said amount only for the purpose of acquiring the new asset. Hon ble courts in similar circumstances held that, the assessee would be given the benefit of deduction u/s 54F of the Act, since, the deduction u/s 54F is beneficial provision and introduced with an intention to encourage the housing / accommodation across the country. assessee is eligible for deduction u/s 54F from the long term capital gains. Though assesses did not make the claim, appellate authorities are not barred from entertaining the fresh claim. This view is supported by in the case of Goetze (India) Ltd [ 2006 (3) TMI 75 - SUPREME COURT] . Hence, we set aside the order of the lower authorities and direct the AO to verify the facts regarding acquiring the new asset and allow deduction u/s 54F in respect of long term capital gains. Accordingly, the order of Ld.CIT(A) in respect of long term capital gains is set aside and the order o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5, therefore, ground No.5 is dismissed as withdrawn. 4. Ground No.2 and 3 are related to the addition made by the Assessing Officer (AO) on account of long term capital gains and short term capital gains of ₹ 4,91,800/- and ₹ 27,30,000/- respectively which was sustained by the Ld.CIT(A). 5. Ground No.4 is related to the deduction claimed by the assessee u/s 54F of the Act, which was rejected by the AO during the assessment proceedings and sustained by the Ld.CIT(A). 5.1. Brief facts of the case are that the assessee is an individual, filed his return of income on 13.10.2010 admitting total income of ₹ 2,44,770/- and agricultural income of ₹ 1,25,000/-. The assessee expired on 12.06.2013 subsequent to completion of assessment proceedings and legal heir, Smt.R.Venkata Dhana Lakshmi was brought on record. The assessment was completed u/s 143(3) on total income of ₹ 37,96,571/-. In the assessment proceedings, the AO made the addition of ₹ 4,91,800/- on account of long term capital gains and ₹ 27,30,000/- on account of short term capital gains. During the assessment it was found that the assessee had purchased the vacant site ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consideration of land @7000/- per sq.yard and structure rate @₹ 600/- per sq.feet and thus determined total value of the undivided share of land of 96 sq.yards at ₹ 6,72,000/- and the cost of acquisition of the land was worked out to ₹ 1,80,200/- inclusive of stamp duty and the indexed cost of acquisition at 480 points and worked out the long term capital gains of ₹ 4,91,800/- as under : Sl.No. Property Description Name of the village As on date Market Value per sq.yard Structure rate for sq.feet 1. F.No.G-2(1060 Sft.) P.Nos.64 64A in Sy.298, 299, 301 402, US 24 sq.yds. Nizampet, Quthbullapur Mandal, R.R. District 26.08.2009 7000/- 600/- 2. F.No.102 (1060 Sft.) P.Nos.64 64A in Sy.298, 299, 301 402, US 24 sq.yds. Nizampet, Quthbullapur Mandal, R.R. District 03.10.2009 7000/- 600/- 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hence, requested to set aside the order of the Ld.CIT(A) and allow the appeal of the assessee. 8. On the other hand, the Ld.DR supported the orders of the lower authorities and argued that the Ld.CIT(A) has rightly upheld the addition made by the AO, hence requested to dismiss the appeal of the assessee. 9. We have heard both the parties and perused the material placed on record. There is no doubt that the assessee has entered into development agreement for construction of the flats and sold 4 flats as per the details given in this order and received the sale consideration. There is no dispute with regard to sale of flats and rates adopted by the AO. The Ld.AR did not bring any evidence to controvert the findings of the AO during the appeal hearing. Therefore, we uphold the action of the AO as well as the Ld.CIT(A) in treating the sale consideration received in respect of transfer of land as long term capital gain and transfer of super structure as short term capital gain. Thus, computing the income under long term capital gains @₹ 4,91,800/- and short term capital gains @ ₹ 27,30,000/- is confirmed. 10. With regard to deduction u/s 54F of the Act, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F on the ground that he did not deposit the said amount in capital gains account scheme before the due date prescribed under section 139(1) of the IT Act ? This was answered by Hon'ble High Court as follows : As is clear from Sub Section (4) in the event of the assessee not investing the capital gains either in purchasing the residential house or in constructing a residential house within the period stipulated in Section 54F(1), if the assessee wants the benefit of Section 54F, then he should deposit the said capital gains in an account which is duly notified by the Central Government. In other words if he want of claim exemption from payment of income tax by retaining the cash, then the said amount is to be invested in the said account. If the intention is not to retain cash but to invest in construction or any purchase of the property and if such investment is made within the period stipulated therein, then Section 54F(4) is not at all attracted and therefore the contention that the assessee has not deposited the amount in the Bank account as stipulated and therefore, he is not entitled to the benefit even though he has invested the money in construction is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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