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TMI Blog2022 (7) TMI 492X X X X Extracts X X X X X X X X Extracts X X X X ..... ich if the capital gain were not invested within the due date as mentioned u/s 139(1) aforesaid person, then such capital gain required to be deposited with the separate bank account called a capital gain account scheme. There is another safeguard as prescribed by the provision of section 54 which provides that, if there is a proportionate amount of capital gain is invested in purchase or construction of a new residential house, then only the pro- rata deduction is available to the assessee. In the present case, admittedly assessee has used with the long term capital gain for purchase of a new residential house and also used for repayment of a housing loan which is borrowed on a property located. Thus, the assessee has invested a capital gain in purchase of two residential houses. The assessee can take shelter and claim deduction u/s 54 only when the assessee invests the long term capital gain in purchase or construction of a single residential house. The words a one residential mentioned in Section 54 of the Act is refers to only a one house which can be purchased or constructed to the amount of capital gain. The word a residential house cannot be read or interpreted as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds of the assessee. 3 As against the assessment order dated 22/12/2016, the assessee has filed the appeal before the Ld. CIT(A). The Ld. CIT(A) has dismissed the appeal by confirming the addition made by the assessee vide order dated 13/02/2018. 4. Aggrieved by the order dated 13/02/2018 passed by CIT(A), the assessee has preferred the present appeal on following grounds. Appeal against the order u/s 143(3) of the Income Tax ACtd, 1961 ( the Act ) dated 13.02.2018 for the Assessment Year 2014-15, passed by the ACIT, Circle 4(1), Gurgaon. 1. The order passed by the Learned Commissioner of Income Tax (Appeals)-l [ Ld. CIT(A) ] under Section 250(6) of the Act is bad in law and on the facts and circumstances of the case. 2. The Learned Commissioner of Income Tax (Appeals)-l [ Ld. CIT(A) ] and Ld. Assessing Officer ('AO') grossly erred in not considering the fact that the agreement to sell for purchasing the new flat was executed on 30th June, 2013 but the sale deed could not be executed because of inter-se litigation between the land owners and the Builder. The Ld. AO further erred in not considering the fact that the Hon'ble Supreme Court has stayed the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as defined under Section 2(47) of the Act which defines the term transfer in relation to a capital asset. 10. The Learned Commissioner of Income Tax (Appeals)-l [ Ld. CIT(A) ] and Ld. Assessing Officer ('AO') grossly erred in not considering the fact that the intention behind Section 54 was to give relief to a person who had transferred his residential house and had purchased another residential house within two years of transfer. 11. The Learned Commissioner of Income Tax (Appeals)-l [ Ld. CIT(A) ] and Ld. Assessing Officer ('AO') grossly erred in not considering the dictum laid down by the Hon'ble Supreme Court in Sanjeev Lal and ors Vs. Commissioner of Income Tax, Chandigarh Anr. Reported in (2015) 5 SCC 775. 12. The Learned Commissioner of Income Tax (Appeals)-l [ Ld. CIT(A) ] and Ld. Assessing Officer ('AO') erred in restricting the benefit u/s 54 in respect of flat bearing No. 1103, AKME Projects Ltd. on an investment of Rs. 49,14,447/- as against the claim of the assessee in respect of investment in two residential flats, on a total investment of Rs.1,12,07,616/-. 13. The Ld. Assessing Officer ('AO') ought to have gra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e sold during the year ie. unit no 95 greenwood city Gurgaon. Further to justify the points, the Appellant may be allowed to produce the additional documents and supporting evidences as part of our appeal. 19. That on the facts and circumstances of the case and in law the Ld. AO/ Ld. TPO erred in not examining the section 54 of the Act in its right perspective. 20. That the appellant craves leave to add, alter, amend or withdraw any ground of appeal either before or at the time of hearing of this appeal as they may be advised. That, the above grounds are independent and without prejudice to each other. 5. The entire grounds of Appeal No. 1 to 20 are against disallowance of deduction claimed u/s 54 of the Act which is the solitary issue involved in the present appeal. 6. We have heard the parties, perused the material on record and gave our thoughtful consideration. It is not in dispute that the assessee has sold residential property and earned capital gain and the assessee has claimed deduction u/s 54 of the Act with respect to investment in two different houses i.e. purchase of a new house and for repayment of loan borrowed for acquisition of another house. Thus, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income under section 139 shall be deposited by him before furnishing such return [such deposit being made in any case not later than the due date applicable in the case of the assesses for furnishing the return of income under sub-section (1) of section 139] in an account in any such bank or institution as may be specified in, and utilised in accordance with, any scheme which the Central Government may, by notification in the Official Gazelle, frame in this behalf and such return shall be accompanied by proof of such deposit: and, for the purposes of subsection (I), the amount, if am. already utilised by the assesses for the purchase or construction of the new asset together with the amount so deposited shall be deemed to be the cost of the new asset. Provided that if the amount deposited under this subsection is not utilised wholly or partly for the purchase or construction of the new asset within the period specified in subsection (I), then. (i) the amount not so utilized shall be charged u/s 45 as the income of the previous year in which the period of three years from the date of the transfer of the original asset expires; and (ii)1 the assessee shall be entitl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Geeta Duggal in ITA No. 1237/2011. The factual matrix of the said case and the present appeal are entirely different. In the case of Geeta Duggal (Supra), the assessee has claimed deduction for purchasing basement, ground floor, first floor and second floor in a single building. The Hon ble Court s opinion is that, the physical structure of a new residential house whether it is literal or vertical, should not come in the way of considering the building as a residential house and there can be several independent units can be permitted in a single building for allowance of the deduction u/s 54/54F. But in the present case, the assessee has admittedly claimed deduction u/s 54 of the IT Act with respect to two different houses i.e. purchase of a new house and for repayment of loan borrowed for acquisition of another house which is situated not only in different building but also in a different area. Therefore, the judgment relied by the Ld. Counsel for the assessee is not applicable to the present case. 11. The Assessing Officer and the Ld.CIT(A) have elaborately discussed the facts and also applied the settled principles of law on the issue involved and passed well reasoned order w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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