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TMI Blog2023 (3) TMI 911X X X X Extracts X X X X X X X X Extracts X X X X ..... d 22.12.2016. Revenue's appeal in ITA No.405/CHNY/2018 2. The only issue in this appeal of Revenue is against the order of CIT(A) directing the AO to verify and allow the claim of deduction u/s.54F of the Act, whereas the CIT(A) has no power to set aside or examine the issue afresh as per the provisions of section 251(1)(a) of the Act. For this, Revenue has raised the following Ground No.2:- 2) The Ld CIT(A) erred in directing the AO to verify the details with supporting documents and to allow deduction u/s 54F. 2.1)The CIT(A) ought to have appreciated that as per section 251(1) (a) of the Act, has been omitted with the "power to set aside" or "examining the issue afresh" effect from 01.06.2001 as per Finance Act 2001. 2.2)The Ld CIT(A) failed to note that there was no pucca sale deed conveying the house property in favour of the assessee. 2.3 )The Ld CIT(A) failed to note that the contrary clause 4 of the said agreement dated 10/12/2011 allows 5 years from date of agreement to execute the sale deed. The assessee is not able to produce any sale deed by which the assessee's wife transferred her residential house property in favour of the assessee till this date, though ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a total consideration of Rs.2,93,10,000/-. In this, the assessee's share was to the extent of Rs.1,59,73,950/-. 3.1 The AO required the assessee to explain the source and investment and assessee explained that he has sold property measuring18,988 sq.ft., at Plot No.7/10B, Ambattur Industrial Estate, MTH Road, Ambattur, Chennai - 58 for a total consideration of Rs.4 crores.Out of settlement of 2011 with his wife Smt. S.K. Geetha,the assessee has purchased a house property at 39/41, Kalashetra Colony, Besant Nagar, Chennai-90 for a total consideration of Rs.3.45 crores by entering into agreement of sale dated 10.12.2011. The consideration for the purchase of property at Besant Nagar was paid out of the property measuring 1254 sq.ft. at Padikuppam Road, Ambattur Taluk for a sum of Rs.1.10 crores purchased by the assessee and flat at Bangalore for a consideration of Rs.15 lakhs, totaling to Rs.1.25 crores. The above consideration was paid out of agreement of sale entered with Smt.S.K. Geetha by way of agreement of sale dated 01.02.2012. Rs.50 lakhs was directly credited to his wife's account out of sale proceeds at Plot No.7/10B, Ambattur Industrial Estates, MTH Road, Chennai - 58, Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al before CIT(A). 4. The CIT(A) after considering the facts in entirety allowed the claim of exemption u/s.54F of the Act by considering that the property was sold when possession was handed over on receipt of full consideration. As regards to AO's observation that the assessee has two houses, the AO has not considered that as on that date another property was landed property only. Therefore, the CIT(A) allowed the claim of deduction u/s.54F of the Act but subject to verification of documents by the AO factually. The CIT(A) finally decided the issue in para 4.3.3 & 4.4.4 as under:- 4.3.3, I have considered both the points of view. Respectfully following the decisions relied on by the appellant, I am of the considered opinion that the receipt of full property was sold when its possession was handed over on consideration. Therefore, I do not agree with the AO that there was no sale of the property on the date of signing of agreement. Now, coming to the AO's observation that the appellant had two houses, the appellant has categorically denied the same by describing the complete set of facts which the AO has not considered during the assessment proceedings. The appellant has fur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e gave colour to it as though it was purchase of a land and thereafter entering into a construction agreement. To provide a legal cover and with an intent to avoid payment of stamp duty on the cost of flat, the assessee opted to register only the portion of the un-divided share of land on 22-12-2011. This is verifiable at page-7 of the submission. He further stated that the CIT(A) failed to take into cognizance this substance over from and also over looked the specific legal restrictions placed by sub clause (ii) of clause (a) of the proviso to section 54F when such admittance are accepted. Further, as held by various judiciaries, as far as investment in a new residential unit, as envisaged under section 54 and 54F, it is the date on which such investment and not the date of taking procession is the criteria, is squarely applicable in this case. Even if such an agreement, specifically entered to take the double benefit of evasion of state stamp duty on purchase of flat as well as avail the tax benefit under the Income Tax Act. Are to be considered as legally accepted norm and cannot be considered as deemed investment in a new property, the clause 3 of the agreement mentions the 24 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... house has not yet started construction and assessee's land is actually land at Padikuppam, the provisions of section 54F(1) proviso (a)(ii) of the Act will not apply because it applies only to residential house. The ld.counsel for the assessee then drew our attention to entire events and dates, which are as under:- Date Particulars 10.12.2011 Sale agreement entered into by the Appellant with the Appellant's wife towards purchase of a residential property situated at Kalakshetra Colony, Chennai (New Asset) for a total consideration of Rs.3,45,00,000/- 22.12.2011 Sale deed executed by the Appellant in relation to purchase of the property situated at Padikuppam vide Doc No.5619/2011 22.12.2011 Sale cum Construction Agreement in relation to purchase of the property situated at Padikuppam 31.03.2015 Assessment order passed in the case of Smt. Geetha (Appellant's wife) for the AY 2012-13 27.11.2017 CIT(Appeals) order passed in the case of Smt. Geetha (Appellant's wife) for the AY 2012-13 06.09.2019 ITAT order passed in the case of Smt. S.K. Geetha (Appellant's wife) for the AY 2012-13 The ld.counsel stated that the assessee has already occupied by taking possession of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. Hence, we find no infirmity in the order of CIT(A) and the same is confirmed. The appeal of Revenue is dismissed. Assessee's Appeal in ITA No.1941/CHNY/2018 7. The only issue in this appeal of assessee is as regards to the order of CIT(A) confirming the action of AO disallowing trading loss on sale of shares at Rs.19.45 lakhs. For this assessee has raised various grounds, which need not to be reproduced. 7.1 We have heard rival contentions and gone through facts and circumstances of the case. We noted that the assessee invested in purchase / trading of shares by way of futures and options in the name of his daughter and suffered loss of Rs.19.45 lakhs and claimed the same in the return of income. The AO and CIT(A) both disallowed the claim only on the reason that the assessee could not furnish the details. The AO observed in the following lines "The A.R. was asked about the transactions and proof for such loss with DMAT account of the assessee. The A.R. has not produced any evidences in support of the trading activities. The primary onus to prove the sources in respect of trade transaction squarely lies on the assessee. In spite of adequate opportunities were provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of AO in making addition of Rs.5 lakhs u/s.69 of the Act was received from Shri K. Kesavan. For this, assessee has raised various grounds, which need not to be reproduced. 9.1 We have heard rival contentions and gone through facts and circumstance of the case. We noted that the assessee could not submit the relevant supporting documents with regard to amount received from Shri K. Kesavan amounting to Rs.5 lakhs. Even the order of CIT(A) is non-speaking and how he reached to the conclusion that the AO has given sufficient opportunities. Even from the assessment order, we could not make out how this amount was disallowed and added u/s.69 of the Act because the individual entry was not discussed by the AO. Hence, keeping in view of facts in mind, we remand this issue back to the file of the AO. Needless to say, assessee will file all the details to prove his case. In term of the above, the appeal of the assessee is allowed for statistical purposes. 10. In the result, the appeal filed by the Revenue in ITA No.405/CHNY/2018 is dismissed and the appeals filed by assessee in ITA Nos.1941 & 1942/CHNY/2018 are allowed for statistical purposes. Order pronounced in the open court on 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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