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TMI Blog2021 (12) TMI 1079X X X X Extracts X X X X X X X X Extracts X X X X ..... ption was still granted to the tax payer, because both the flats were capable of being used as a single residential unit. 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 Section 13(2) of the General Clauses Act. Since there are favourable judgments in support of the contention raised by the assessee, therefore, we hold that assessee is eligible for claim of exemption u/s 54 in respect of purchase of 3 different residential houses and amendment brought in the Finance Act, 2014 w.e.f. 01.04.2015 will not be applicable in AY 2013-14. - Decided in favour of assessee. - ITA No.3135/Del./2018 - - - Dated:- 23-12-2021 - Hon ble President, Shri G.S. Pannu And Shri Amit Shukla, Judicial Member For the Assessee : Shri Kapil Goel, Advocate For the Revenue : Shri Harpal Singh, Senior DR ORDER PER AMIT SHUKLA, JM : Aforesaid appeal has been filed by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , after considering various judgments and Explanatory Note to Finance Act, 2014, amending the statute w.e.f. 01.04.2015, i.e., AY 2015-16. He restricted the claim of deduction u/s 54 to only one flat having higher value of ₹ 1,04,86,714/- and accordingly, he worked out the disallowance of ₹ 49,62,490/-. 5. We have heard the rival submissions and gone through the impugned order as well as material placed on record. The case of the assessee is that the expression a residential house is to be understood in a sense that the building should be residential one and the word a residential should not be construed as a singular number. Before us, ld. counsel has relied upon various judgments which we shall discuss hereinafter. 6. On the other hand, the case of the Revenue is that a residential house should be treated as one residential house and the amendment brought in the statute w.e.f. 01.04.2015 is mere clarificatory. 7. It is and undisputed fact that the assessee has claimed exemption under long term capital gain after selling 3 units of residential property and thereafter has purchased another 3 units in the same city. The only issue is whether exemption is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of residential nature and a should not be understood to indicate a singular number- Four residential flats cannot be construed a' four residential houses for the purpose of s. 54 but it has to be construed only as a residential house and the assessee is entitled to the benefit accordingly. NILESH PRAVIN VORA YATIN PRAYIN YORA YS. ITO (2016) 045 ITR (Trib) 0228 Capital gains - Exemption under section 54 Purchase of two flats - In the course of assessment proceedings, AO asked as to why exemption under section 54 in respect of one house might not be withdrawn as deduction was available in respect of only one house. Assessee had submitted that both flats were taken in the same Vile Parle, Mumbai for residential purpose hence the same might be treated as one residential unit. AO, however, denied deduction in respect of one flat. CIT(A) confirmed the order of AO. Held: AO was directed to allow the claim of the assessee with respect to two flats purchased by the assessee as it was pertinent to mention that in the case of CIT v. Smt. V R. Karpagam (2015) 373 ITR 127 (Mad), it was clearly held that the amendment to provision of section 54F is effective from 1- 4-2015, wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le even if the flats are on different floors. On facts, as the two flats purchased by the assessee are adjacent to one another and have a common meeting point, the deduction cannot be denied. The final conclusion drawn after studying the above mentioned judgements of various authorities is that the expression a residential house should be understood in a sense that building should be of residential in nature and a should not be understood to indicate a singular number. Also, section 54/54F uses the expression a residential house and not a residential unit Section 54/54F requires the assessee to acquire a residential house and so long as the assessee acquires a building, which may be constructed, for the sake of convenience, in such a manner as to consist of several units which can, if the need arises, be conveniently and independently used as an independent residence, the requirement of the Section should be taken 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 th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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