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TMI Blog2022 (7) TMI 632X X X X Extracts X X X X X X X X Extracts X X X X ..... ctions. However, in the light of the fact that units have been constructed on a single piece of land, these factors would not be of much relevance to determine the eligibility to claim deduction u/s 54F. The ground floor has been occupied by the assessee himself whereas each of the other two floors are occupied by two tenants each. The same is one of the factors as considered by AO to deny the deduction. The conclusion of Ld. AO would necessarily mean that the assessee was debarred from making separate units on a single piece of land and secondly, it raises a presumption that complete building should have been used by the assessee for its own residential purposes as a single unit. However, the same is not the intention of the legislat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - - - Dated:- 13-7-2022 - Hon ble Shri V. Durga Rao, Judicial Member And Hon ble Shri Manoj Kumar Aggarwal, AM For the Appellant : Shri S. Sridhar (Advocate) Ld. AR For the Respondent : Shri V. Justin (Addl.CIT) Ld. DR ORDER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2015-16 arises out of the order of learned Commissioner of Income Tax (Appeals), Salem [CIT(A)] dated 07-03-2019 in the matter of assessment framed by Ld. Assessing Officer [AO] u/s. 143(3) of the Act on 30-11-2017. The assessee has filed concise grounds of appeal which read as under: - 1. The order of Ld. CIT(A) is contrary to law, facts, evidence on record; opposed to principles of natur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the fact that the provisions are beneficial provisions, majority of the courts have held that a residential house as occurring in the provisions was not to be construed as one residential house; but the expression may be extended to mean multiple houses or units also considering the facts of the case. 3. To end this controversy, Finance Act, 2014 has brought material change in the aforesaid provisions and substituted the expression a residential house property with the words one residential house with effect from 01/04/2015. The rationale of the amendment, as explained in clause 20.3 of the explanatory notes to the Finance Bill was as follows: - 20.3. Certain courts had interpreted that the exemption is also available if invest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... change merely because the purchase of new assets in the form of residential houses is at different addresses. So long as the same Assessee 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 u/s 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. It was also held that the amendment made by The Finance Act, 2014 was intended to be specifically applied only prospectively with effect from AY 2015-16 since it took note of the judicial precedents for period prior to 01/04/2015. 5. O ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... family. Thus, the assessee had acquired more than one residential house. 6.2 The assessee defended the same on the ground that it had constructed only one residential house only which could be verified from building plan approval, property tax assessment etc. For all purposes, the house was considered as a single residential house only. The basic idea of making three separate dwellings was to live with the two daughters as a joint family post retired life. Since the daughters could not shift immediately, the floors were temporarily let out and rental income was earned which was offered to tax. 6.3 However, relying upon the amended provisions of Sec.54F, Ld. AO held that the deduction would not be available to the assessee. The alterna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these factors would not be of much relevance to determine the eligibility to claim deduction u/s 54F. 8. It is also evident that the ground floor has been occupied by the assessee himself whereas each of the other two floors are occupied by two tenants each. The same is one of the factors as considered by Ld. AO to deny the deduction. However, the conclusion of Ld. AO would necessarily mean that the assessee was debarred from making separate units on a single piece of land and secondly, it raises a presumption that complete building should have been used by the assessee for its own residential purposes as a single unit. However, the same is not the intention of the legislature. The only requirement is that the assessee should make inves ..... X X X X Extracts X X X X X X X X Extracts X X X X
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