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TMI Blog2022 (7) TMI 676X X X X Extracts X X X X X X X X Extracts X X X X ..... ear. 2. The ld CIT(A) erred in law and on facts in not appreciating that the AO travelled beyond his jurisdiction in concluding that appellant had to offer capital gain of Rs.2,02,22,198/- in assessment year 2018-19 when the assessment for said year was not before him and further, on facts and true legal position, the said amount being not taxable even in Assessment Year 2018-19, the order and conclusion of AO ought not to have been be affirmed. It be so held now. 3. Without prejudice to the above, as the appellant has satisfied the condition of purchase of one house by acquiring common residence of Flat No: 601 & 601 as per undisputed facts, there being no violation of any condition of section 54F in any year the authorities below erred in law and on facts in holding that amount of Rs.2,02,22,198/- was to be taxed as capital gain in A.Y. 2018-19. 4. Without prejudice to the above ground, and though the facts clearly established that appellant had purchased one residential house, the amended provisions clearly enabled even purchase of one more house under which also benefit claimed ought to be given. 5. The ld CIT(A) erred in law and on facts in not appreciating that the or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttorney of Bandhavi Sharma. The seller of flat No.602 is Arun Sharma and his wife Deepa Sharma. Both are father and mother of Bandhavi Sharma. The seller had joined/combined two flats in to one flat. There is a one entrance of main door. However, seller daughter and father has two agreements for their purchase, we have to execute two sale deeds. In fact there is a one residential flat No.601/2. The assessee has purchased flat jointly with his wife, Smt. Rima Shailesh Desai. Full payment is made by the assessee from his SBI Capital gain account and from his own funds. The assessee is a 100% owner of the said property. For the sake of convenience, his wife's second name is there in the document." 4. The Assessing Officer did not find merit in the submission made by the assessee and rejected the same for the following reasons given in his order:- "(i) Purchase deed has been executed in respect of Flat No.601 and 602 independently by the previous owners. (ii) The present sale deed executed in respect of Flat No.601 and 602 in the name of the assessee and his spouse also recognizes the same as independent residential flats. (iii) No evidence in the form of sanction of the BMC f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 800 Less : Indexed Cost of Acquisition 4,54,602 Long Term Capital Gain (A) 2,52,22,198 Less : Deduction u/s 54F of the Act (Deposit in Capital Gain account with SBI on 20.07.2016) (B) 2,06,00,000 Less : Deduction u/s 54EC of the Act (Deposit in NHAI Capital Gain Bonds on 30.11.2015) (C) 50,00,000 Total Deduction (D = B+C) 2,56,00,000 Taxable Long term Capital gain (A-D) NIL 5.2 As against total capital gain of Rs. 2,52,22,198/-, investment in view of provisions of section 54EC and 54F was made to the tune of Rs. 2,56,00,000/- and capital gain was shown at Nil while filing return of income by the appellant. During the course of Assessment Proceedings, the Assessing Officer observed that the appellant has made deposit with State Bank of India Capital Gain Account scheme to Rs. 2,06,00,000/- on 20.07.2016 i.e. on or before the due date of filing Return of Income u/s 139(1) of the Act and thus claim of appellant for the year under being A.Y. 2016-17 was allowed. It was further observed that financial year 2017-18, the appellant purchased two residential units by withdrawing from capital gain account and contravened the provisions of section 54F(1) of the Act which l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng a residential house, and the assessee within a period of one year before or two years after the date of transfer, purchases, or within a period of three years after the date of transfer constructs, a residential house then the amount of capital gains to the extent invested in the new residential house is not chargeable to tax under section 45 of the Act. The existing provisions contained in sub-section (1) of section 54F, inter alia, provide that where capital gains arises from transfer of a long-term capital asset, not being a residential house, and the assessee within a period of one year before or two years after the date of transfer, purchases, or within a period of three years after the date of transfer constructs, a residential house then the portion of capital gains in the ratio of cost of new asset to the net consideration received on transfer is not chargeable to tax. The benefit was intended for investment in one residential house within India. Accordingly, it is proposed to amend the aforesaid sub-section (1) of section 54 so as to provide that the rollover relief under the said section is available if the investment is made in one residential house situated in In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... learly understood that the agreement signed by the assessee with 'M', is that the assessee will receive 43.75 per cent of the built up area after development, which is construed as one block, which may be one or more flats. In that view of the matter what was before the Assessing Officer is only equivalent of 56.25 per cent of land transferred, equivalent to 43.75 per cent of built up area received by the assessee. This built up area got translated into five flats. Hence, it is opined that the transaction in this case was not with regard to the number of flats but with regard to the percentage of the built up area, vis-a-vis, the Undivided Share of Land. [Para 10]" 5.5...... ... .. Thus by making above-amendment in Finance Act, 2015, now, assessee cannot make investment in property outside India for the purpose of claiming deduction u/s 54F of the Act as well as assessee cannot acquire more than one house property. The appellant has relied upon decision of Hon'ble High court referred in his submission which relates to first restriction provided in section 54F of the Act whereas case of appellant falls within second restriction, as discussed herein above. 5.6 In the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X
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