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TMI Blog2021 (9) TMI 1138X X X X Extracts X X X X X X X X Extracts X X X X ..... ch in the case of Shri Chandrashekar Veerabhadraiah [ 2020 (12) TMI 348 - ITAT BANGALORE ] we are unable to agree with the view taken by the tax authorities that each floor of the individual house/each portion in a floor is separate house property. Accordingly, we set aside the order passed by CIT(A) on this issue and hold that the house property received by the assessee is one residential house only within the meaning of sec.54F of the Act. Accordingly, we are of the view that the reasoning given by the AO to reject the claim for deduction u/s 54F is not justified. Appeal of the assessee is allowed. - ITA No.789/Bang/2019 - - - Dated:- 24-9-2021 - Shri N.V. Vasudevan, Vice President And Shri B.R. Baskaran, Accountant Member For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see has constructed more than one residential house and hence he would be entitled for deduction u/s 54F of the Act for construction of one residential house only. Accordingly, the AO allowed deduction u/s 54F of the Act for one residential unit only by adopting proportionate cost of construction of one residential house at ₹ 27.10 lakhs and proportionate cost of land at ₹ 5.94 lakhs. The Ld. CIT(A) also confirmed the same and hence, the assessee has filed appeal before us. 4. We heard the parties and perused the record. The question, whether each floor of a single stand alone building should be considered as separate house was examined by the co-ordinate bench in the case of Shri Bhatkal Ramarao Prakash vs. ITO (ITA No.2692/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only one property and not two properties. In this regard, the decisions cited by the ld. Counsel for the assessee before us supports the plea of the assessee viz., the decision of the Delhi High Court in the case of CIT Vs. Gita Duggal (2013 30 taxmann.com 230 (Delhi). In the aforesaid decision, the facts were that the assessee entered into a development agreement pursuant to which the developer demolished the property and constructed a new building comprising of three floors. In consideration of granting the development rights, the assessee received ₹ 4 crores and two floors of the new building. The AO held that in computing capital gains, the cost of construction of ₹ 3.43 crores incurred by the developer on the development of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ken to have been satisfied. There is nothing in these sections which require the residential house to be constructed in a particular manner. The only requirement is that it should be for the residential use and not for commercial use. If there is nothing in the section which requires that the residential house should be built in a particular manner, it seems to us that the income tax authorities cannot insist upon that requirement. A person may construct a house according to his plans, requirements and compulsions. A person may construct a residential house in such a manner that he may use the ground floor for his own residence and let out the first floor having an independent entry so that his income is augmented. It is quite common to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed by the co-ordinate bench with the following observations:- 4. In this miscellaneous petition, the revenue has contended that since the Tribunal has placed reliance on the decision of the Hon'ble High Court of Karnataka rendered in the case of B. Ananda Bassappa (supra) and K G Rukminiamma (supra) and since by the Finance Act, 2014, section 54F was amended by substituting the words a residential house with one residential house and since the assessment year in this appeal is after the aforesaid amendment, the conclusions drawn by the Tribunal are incorrect and suffers from an apparent mistake on the face of record and should be rectified suitably. 5. We have heard the rival submissions. The ld. DR reiterated the sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions were only purely supportive, but the real conclusion of the Tribunal on facts is that the assessee purchased only one house property. In the circumstances, we are of the view that there is no mistake, much less an apparent mistake, in the order of Tribunal. 6. The view taken in the case cited above is that an independent building can have a number of residential units and it will not lose the character of one residential house . Identical view has been expressed by another co-ordinate bench in the case of Shri Chandrashekar Veerabhadraiah vs. ITO (ITA No.2293/Bang/2019 dated 07-12-2020 relating to AY 2015-16). Accordingly, we are unable to agree with the view taken by the tax authorities that each floor of the individual house/ea ..... X X X X Extracts X X X X X X X X Extracts X X X X
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