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TMI Blog2022 (6) TMI 968X X X X Extracts X X X X X X X X Extracts X X X X ..... on 54F of the Act and the AO is directed to allow the same to the assessee. We find from the records that the Indiabulls property was under construction and the possession was handed over to the assessee only on 28.12.2016, till such time income from the said property was not chargeable under the head Income from house property and hence the condition stipulated in clause (b) of proviso to sec. 54F (1) disentitling claim u/s 54F is not satisfied. - Decided in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... here was no allotment letter issued to assessee; therefore, the claim of the assessee that India bulls property was purchased in 2009-10 was rejected. 3.1 The assessing officer further observed that had the claim of the assessee was India bulls property was purchased in FY 2009-10 was accepted, it would mean that as on the date of transfer of original asset, the assessee had the following two residential houses: 1. Pune Kohinoor flat which was sold on 07/08/2012 2. India bulls property which according to assessee was purchased during F.Y. 2009-10. On this, the assessee submitted that investment in India bulls property was made jointly with assessee's wife, Mrs.Yamini Gawande. To avail exemption u/s 54F what is required is the assessee should not own more than one residential house on the date of sale and further assessee should not purchase any other residential house other than the new asset within a period of one year after the date of transfer of the original asset. 3.2 The assessing officer, however, did not accept the submissions of the assessee. He observed, the assessee purchased India bulls property jointly along with his wife. Therefore, the assessee was not the full ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Smt. V.K.S. Bawa vs. ACIT (53 ITD 232) wherein it was held that when an assessee has become owner of a share (fractional) in property bequeathed to her by her mother, by the time the assessee purchased another property, she could not claim exemption u/s. 54F of the Act. In the case of Ravinder Kumar Arora (supra) it was held that the assessee having invested the entire amount of long term capital gain in purchase of new residential house was entitled to exemption u/s. 54F in respect of the entire amount even though the new property was in the joint names of assessee and his wife. In view of the foregoing discussion, if an assessee jointly owns more than one property, then the assessee is not entitled for deduction u/s. 54F of the Act. v) If assessee's contention that 'part ownership is not the ownership' is accepted that in all cases wherein any assessee, anywhere in India, claims benefit u/s 54/54F/ or any other section of Income tax Act, 1961 by investing jointly in a residential property should be denied the benefit wherein relevant section of Income Tax Act, 1961 states 'assessee purchases/owns a residential house'. Accordingly it is decided that on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld.AR further drew our attention to a slew of judicial precedents to rebut the point that the assessee was, in fact, the owner of the property at India bulls, as on the date of sale of land at Jambhe. Some of them are - 1. Ashok G Chauhan v. ACIT (2019) 105 taxmann.com 204 (Mum) 2. ITO vs Rasiklal N Satra (2006) 98 ITD 335 (Mum) 3. DCIT vs Shri Dawood Abdulhussain (ITA No.3788/Mum/2016) 4. CIT vs Kapil Nagpal (2015) 63 taxmann.com 366 (Del) 5. Dr Smt. P.K. Vasanthi Rangrajan vs CIT (2012) 23 taxmann.com 299 (Mad) 6. Amit Gupta vs ACIT (2017) 81 taxmann.com 445 (Del- Trib.) 7. Ram Prakash Miyan Bazaz vs DCIT (2014) 45 taxmann.com 550 (Jaipur) 8. George Dominic (2013) 35 taxmann.com 547 (Cochin) 6. The learned departmental representative, on the other hand, relied upon the orders of the authorities below and submitted that applying the proviso (a) (i) & a (ii) to section 54F, exemption under section 54F cannot be allowed to the assessee. In fact, the assessee has hidden the fact of ownership of the property held at Pune. 7. We have considered the rival submissions and perused the materials placed on record. We have thoroughly analyzed the citations relied upon by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore the Tribunal that as per the judgment of the High Court of Madras in the case of Dr. Smt. P .K. Vasanthi Rangarajan (supra) unless and until there were materials to show that the assessee was the exclusive owner of the residential property, the harshness of the proviso could not be applied for denying exemption under section 54F of the Act. It was also contended on behalf of the assessee that the Madras High Court in this case had also held that when it was clear that as on the date of transfer, the assessee did not own residential house in her/his name only and was the holder of only 50% of share, then the provisions of section 54F of the Act would not create a rider and the assessee could be held entitled to exemption under 54F of the Act. This argument found favour with the Tribunal and the Tribunal held at para 12 as under-"Hence, we are inclined to hold that the issue raised by the assessee is squarely covered in favour of the assessee by the judgment of the Hon'ble Madras High Court in the case of Dr. Smt. P .K Vasanthi Rangarajan (supra) and the assessee cannot be denied exemption under section 54F of the Act merely because he was the holder of 50% of the share ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n u/s 54F (1) in respect of Abhimanshree Property at Pune. He contends that India Bulls Property was purchased on 09.10.2009 (Ref letter dated 26.02.2016-recorded in assessment order on page no. 3 and 4 of the Assessment Order). Therefore, there is no violation of condition under clause (a)(ii) of proviso to sec. 54F(1) that the assessee should not purchase any residential house other than the new asset within one year from the date of transfer. The Appellant further contends that The India bulls property was owned jointly by the appellant along with his wife. The ownership in the property is fractional ownership or joint ownership and not an exclusive ownership of the appellant. As such the condition provided in clause (a)(1) of proviso to sec. 54F(1) that on the date of transfer of capital asset, the assessee should not own more than one house, other than new asset, is not breached since the appellant was owner of only Kohinoor flat at Pune as on the date of sale of Jambhe Land." 11. We find from the records that the Indiabulls property was under construction and the possession was handed over to the assessee only on 28.12.2016, till such time income from the said property was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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