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TMI Blog2019 (8) TMI 1735X X X X Extracts X X X X X X X X Extracts X X X X ..... ntial house used in section 54 makes it clear that it is not to convey the meaning that it refers to a single residential house. Hence in our considered opinion, the issue in the present case is squarely covered in favour of the assessee and against the revenue by this judgment of Hon'ble Karnataka High Court and respectfully following the same, we hold that the authorities below were not justified in rejecting the claim of the assessee for deduction u/s. 54F on this basis that the assessee has sold two commercial properties and claimed deduction u/s. 54F. There is no other objection of the authorities below regarding the assessee s eligibility for deduction u/s. 54F of the IT Act. But still we feel it proper to restore back this matter to the file of AO to quantify and allow deduction u/s. 54F of the IT Act as per law. If it is found that the assessee has purchased a new eligible residential house property within prescribed time, then it should be held that the assessee is eligible for deduction u/s. 54F and deduction should be quantified and allowed as per law. - Appeal filed by the assessee is allowed for statistical purposes. - ITA No. 897/Bang/2019 (Assessment Year : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sections. In para 8 of the assessment order, the AO has come to the conclusion that since the long term capital gain in the present case is arising on account of sale of two properties, the assessee is not eligible for deduction u/s. 54/54F of the IT Act. Being aggrieved, the assessee carried the matter in appeal before the ld. CIT(A) but without success and now the assessee is in further appeal before us. 4. The ld. AR of assessee placed reliance on the Tribunal order rendered in the case of Smt. Hemalatha Chandran Vs. ITO in ITA No. 603/Mds/2015 dated 01.04.2016 for Assessment Year 2011-12 and rendered in the case of ACIT Vs. Shri Mohinder Kumar Jain in ITA No. 5254/Del/2014 dated 04.08.2017 for Assessment Year 2011-12. He submitted a copy of both these Tribunal orders. He also placed reliance on the judgment of Hon'ble Karnataka High Court rendered in the case of CIT Another Vs. Smt. K.G. Rukminiamma as reported in [2011] 331 ITR 211 (Karn). He submitted a copy of this judgment also and pointed out that this was held by Hon'ble Karnataka High Court in this case that the letter a used should not be construed as meaning singular but being an indefinite article. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 54 and 54F are quite different. The relevant portion is reproduced as under: Sec. 54: Subject to the provisions of sub-section (2), where, in the case of an assessee being an individual or a HUF, the capital gain arises mm the transfer of a long term capital asset being buildings or lands appurtenant thereto and being a residential house the income of which is chargeable under the head income from house property and the assessee has within a period of one year before or two years after the date on which the transfer took place purchased, or has within a period of three years after that date, constructed a residential house, then instead of capital gain being charged to income tax as income of the previous year in which the transfer took place, it shall be dealt with in accordance with the provisions of this section; Sec. 54F: Subject to the provisions of sub-section (2), where, in the case of an assessee being an individual or a HUF, the capital gain arises mm the transfer of a long term capital asset not being a residential house and the assessee has within a period of one year before or two years after the date on which the transfer took place purchased, or has within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reproduce para no. 10 of the judgment of Hon'ble Karnataka High Court rendered in the case of CIT Another Vs. Smt. K.G. Rukminiamma (supra). 10. The context in which the expression 'a residential house' is used in s. 54 makes it clear that, it was not the intention of the legislation to convey the meaning that it refers to a single residential house. If that was the intention, they would have used the word one . As in the earlier part, the words used are buildings or lands which are plural in number and that is referred to as a residential house , the original asset. An asset newly acquired after the sale of the original asset also can be buildings or lands appurtenant thereto, which also should be a residential house . Therefore, the letter 'a' in the context it is used should not be construed as meaning singular''. But, being an indefinite article, the said expression should be read in consonance with the other words 'buildings' and 'lands' and, therefore, the singular 'a residential house' also permits use of plural by virtue of s. 13(2) of the General Clauses Act. This is the view which is taken by this Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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