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TMI Blog2022 (7) TMI 1300X X X X Extracts X X X X X X X X Extracts X X X X ..... ideration the provisions of section 54 as amended by Finance Act 2014 and applicable to AY 2015-16 which is relevant in this case. - ITA No. 914/Del/2020 - - - Dated:- 28-7-2022 - Shri N.K. Billaiya, Accountant Member And Shri N.K. Choudhry, Judicial Member For the Appellant : Shri Vijay Jindal, Ld. CA For the Respondent : ShriAnujGarg, Ld. Sr. DR ORDER PER N.K. CHOUDHRY, J.M. This appeal has been preferred by the assessee against the order dated 04.12.2019, impugned herein, passed by the learned Commissioner of Income-tax (Appeals)-10, New Delhi (in short Ld. Commissioner ), u/s. 250 of the Income-tax Act, 1961 (in short the Act ) for the assessment year 2015-16. 2. Brief facts relevant for adjudication of the instant appeal are that the Assessee sold a property on a total consideration of Rs.2,51,00,000/- + Rs.7,53,000/- as transfer expenses (brokerage) and during the year under consideration, claimed the deduction u/s. 54 of the Act before the Assessing Officer. 2.1 The AO while considering the claim of the Assessee u/s 54 of the act made the field enquiry through Inspector (IT) who vide inspection report dated 04.12.2017 reported as und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of first ground of appealmentioned above, allowing index cost of acquisition taking the view of cost of construction of Rs.2,50,000/- as Rs.2,32,000/-. The concluding part of the order impugned for ready reference and brevity is reproduced herein below: 7.2. I have considered the above facts on record and submissions of Ld. AR. It is noted on perusal of assessment order that in response to show cause notice issued by the AO, vide letter dated 04/12/2017, it was explained by the appellant that the property under question is one single house in the name of single owner, purchased from single seller only, property was purchased jointly with her daughter and son-in-law for self residence purpose only and for the purpose of section 54 it is one residential house and cannot be treated more than one residential house. From the relevant portion of show cause notice, it is noticed that AO was of the view that since assessee has purchased ground, first and second floor they are separate residential units having separate entrances, therefore the claim of exemption u/s 54 cannot be allowed as per amended provisions of section 54 which have been amended w.e.f. 01/04/2015 w.e.f AY 2015- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s purchased one residential house in India having different units located on the same plot of land at different floors and entire property is being used by the appellant for residential purpose. The only reason for disallowance of claim of exemption u/s 54 is that AO is of the view since the investment has been made by the appellant in respect of different units, above exemption is not allowable since it cannot be treated one residential house. 7.4 Considering the entirety of the facts and circumstances, I place reliance on the judicial precedence on the identical facts and are squarely applicable in the appellant s case: a) Mrs.SaritaSandhu, New Delhi vsAcit, New Delhi in ITA No. 1777/Del./2017 dated 17 April, 2018, relevant portion of which is reproduced below: 7. After hearing both the sides and perusing the materials available on record, we find that the assessee purchased two units, property No. 1601 and 1602 in Block Tulip, Omaxe Forest, Faridabad by one sale agreement with the builder, which are situated opposite to each other on the same floor. As per submissions of the assessee, it is observed that the assessee had purchased properties according to his plans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... house. High Court are therefore, unable to see how or why the physical structuring of the new residential house, whether it is lateral or vertical, should come in the way of considering the building as a residential house. High Court do not think that the fact that the residential house consists of several independent units can be permitted to act as an impediment to the allowance of the deduction under Section 54/54F. It Is neither expressly nor by necessary implication prohibited, reasons High Court are of the view that the Tribunal took the correct view. No substantial question of law arises for High Court consideration. The appeal is accordingly dismissed with no order as to costs. 8. Similar view has been taken by IT AT, Mumbai Bench in DCIT vs. Jai TrikanandRao (supra) after following the decisions in the case of Gita Duggal (supra) and distinguishing the decision in PawanArya vs. CIT(supra) relied by the Id. DR. The relevant observations of the Tribunal read as under: 5. Secondly, in the Revenue's appeal, the decision of the Ld.CIT(A) in allowing the exemption of Rs. 59,18,4967- u/s 54 of the Act claimed by the assessee on account of the investment/cost of con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nature and the fact that residential house consisted of several independent units cannot be an impediment for granting relief under said section, even if such independent units are situated side by side, on different floors or are purchased under separate sale deeds. The High Court of Andhra Pradesh in the said case has agreed with the findings of the decision of the High Court of Karnataka in the case of CIT v. D. AnandBasappa (Supra). Therefore, considering the totality of the facts and circumstances in the light of consistent view of different High Courts, we are of the view that the Ld.CIT(A) has correctly decided that the assessee is entitled for exemption under section 54 of the Act as regards the investments/cost of construction claimed by the assessee in respect of all the flats, in view of that matter, we do not find any justifiable reason to interfere with the decision of the Ld. CIT(A) on this count and the same is upheld. b) BrijBhushanTayal, New Delhi vs ACIT, CIRCLE 19(1) dated 13 October, 2016 in I T.A. No. 3272/DEL/2014, relevant portion of which is reproduced below: 8.10. However, learned CIT has drawn the adverse conclusion that the substance of the jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... capital gain tax. However, the proviso to section 54 of the Income-tax Act, lays down that if the assessee has already one residential building, he is not entitled to exemption of capital gains tax, when he invests the capital gain in purchase of additional residential building. This judgment was followed by the same High Court in the decision in CIT v. Smt K.G. Rukminiamma [20117 196 Taxman 87/[20107 8 taxmann.com 121 (Kar.). 8.12 I also find that the above judgment of Delhi HC in the case of CIT VsGeetaDuggal (Supra) is affirmed by the Supreme court (2015) 228 Taxman 62 (SC). I also find that this issue came up before I TAT Mumbai in the case of NileshPravinVora and VatinPravinVora (Legal Heirs of Late PravinLaxmidasVora) Vs ITO 2016 (5) TMI 64 and it has been held that held that exemption u/s 54F will be allowed for purchase of more than one residential unit as the amendment to section 54F is effective form 1.4.2015. 6. The facts being similar, following the same reasoning the Assessing Officer is directed to allow the claim of the assessee with respect to two flats purchased by the assessee as discussed above. It is pertinent to mention here that the hon'ble Ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ost of acquisition after computing the same as directed in respect of first ground of appeal mentioned above, allowing indexed cost of acquisition taking the value of cost of construction of Rs.2,50,000/- as Rs.2,32,000/-. 4. The Revenue Department being aggrieved with the impugned order is in appeal before us. 5. Heard the parties and perused the material available on record. At the outset, we observe that the ld. Assessing Officer denied the claim u/s. 54 of the Act mainly on the ground that the Assessee did not submit any evidence or certificate to show that three flats and one basement may be treated as one residential unit. The Assessee failed to discharge its onus to prove that three flats and one basement is a one residential unit. The burden to prove is on the Assessee, in which she has failed. The AO further held that section 54 is amended by Finance Act, 2014 and apply in relation to A.Y. 2015-16 and the Legislature inserted the words one residential house in place of a residential house . 5.1 The ld. Commissioner, on appeal, while relying upon various judgments including the decision of Hon ble High court of Delhi in the case of Gita Duggal (supra), al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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