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TMI Blog2019 (12) TMI 1543X X X X Extracts X X X X X X X X Extracts X X X X ..... residential houses is at different addresses which would depend upon the facts and circumstances of each case. So long as the same Assessee (HUF) purchased one or more residential houses out of the sale consideration for which the capital gain tax liability is in question in its own name, the same Assessee should be held entitled to the benefit of deduction under Section 54 of the Act, subject to the purchase or construction being within the stipulated time limit in respect of the plural number of residential houses also. The said provision also envisages an investment in the prescribed securities which to some extent the present Assessee also made and even that was held entitled to deduction from Capital Gains tax liability by the authorities below. If that be so, the Assessee-HUF in the present case, in our opinion, complied with the conditions of Section 54 of the Act in its true letter and spirit - Decided in favour of assessee. - I.T.A. No. 1112/Chny/2018 - - - Dated:- 27-12-2019 - Shri Ramit Kochar, Accountant Member Shri Duvvuru R.L. Reddy, Judicial Member Appellant by : Shri Srinivasa Rao Vana, JCIT Respondent by : Shri N. Arjun Raj, C.A for Shri S. Sri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for reversing the findings of the ld. CIT(A). On the other hand, by filing copy of the decision in the case of Tilokchand Sons v ITO [2019] 413 ITR 189 (Mad), the ld. Counsel for the assessee has submitted that the issue raised in the appeal of the Revenue is squarely covered in favour of the assessee besides, supporting the order passed by the ld. CIT (A). 4. We have heard the rival submissions, perused the material placed on record and gone through the orders of authorities below including the paper book. Out of the total consideration of ₹.20 crores, an amount of ₹.1,51,00,000/- was deposited in CG Scheme and the balance of ₹.18.49,40,160/- was invested in purchase of house. As per two separate purchase deeds both dated 19.03.2008 the assessee purchased the two properties one at New Door No.2, Vasan Street, T. Nagar, Chennai from Mr. Raghunathan Krishnan for a consideration of ₹. 6,00,00,000/- and the other property at bearing New Door No.4, Vasan Street, T. Nagar Chennai from Mr. P. Mahaveer Chand Jain Mrs. Santosh Kumari for a consideration of ₹. 11,00,00,000/- and after including stamp duty and registration fees, the total cost for purchas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by them at the bar. 15. Section 54 of the Act, to its relevant extent, is quoted below for ready reference: Profit on sale of property used for residence. 54. [(1)] Subject to the provisions of sub-section (2), where, in the case of an assessee being an individual or a Hindu undivided family], the capital gain arises from 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 (hereafter in this section referred to as the original asset), 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, one residential house in India, then], instead of the 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 following provisions of this section, that is to say,- (i) if the amount of the capital gain is greater than the cost of the residential house so purchased or constructed (hereafter in this se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not necessarily restrict the meaning of 'a' to one. If the capital gains arise out of sale of plural of Capital Assets also, including the residential house, it would give rise to taxable capital gains. There is no reason to restrict the benefit of deduction upon investment in residential houses even though such units of residential houses are plural, which is not always so. The word 'a' would normally mean one. But it can in some circumstances include within its ambit and scope plural number also. It may be two or three or even more. The very need to amend the later part of Section 54(1) seems to have been to restrict such plurality to be included in word 'a' by inserting word one residential house with effect from 01.04.2015. 18. It would be of interest to refer to the Explanatory notes along with the Finance Bill by which the said amendment was incorporated in Section 54, which is quoted below for ready reference: 20.Capital gains exemption in case of investment in a residential house property 20.1. The provisions contained in sub-section (1) of Section 54 of the Income Tax Act, before its amendment by the Act, inter alia, provided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sent case. 20. We have discussed about the two decisions from the Karnataka High Court, which, in our opinion, dealt with similar controversy as is raised before us herein. The only difference which we find is that the purchase of the residential houses in the present case is at different address in the same city of Madurai. In D.Ananda Basappa case stated (supra), two flats in question were admittedly adjacent to each other and which were joined to become one residential house. In the case of Khoobchand M.Makhija (supra), two door nos are given viz., 623 and 729, but the complete addresses and even the name of the city is not clear in the facts narrated in the said Judgment. But in our considered opinion, the difference of location of the newly purchased residential house(s) will not alter the position for interpretation of the word 'a residential house' to the effect that it may include more than one or plural residential houses, as held by Karnataka High Court, with which we respectfully agree. The location of the newly purchased houses by the same assessee viz., HUF out of sale consideration received on the sale of original capital Asset or a residential house in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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