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TMI Blog2023 (4) TMI 238X X X X Extracts X X X X X X X X Extracts X X X X ..... treating the same as short term capital gain . Decided against assessee. Benefit of exemption u/s 54 - Denial of deduction of basement floor on the ground that the benefit of can be passed on the assessee only in respect of one residential property instead of claim of 3 properties - HELD THAT:- In the case of Tilokchand Sons [ 2019 (4) TMI 713 - MADRAS HIGH COURT] has held that where the assessee HUF sold its residential house and invested capital gain in purchasing more than one residential houses within stipulated time limit assessee would be entitled to benefit of exemption u/s 54. Similarly in the decision of Khoobchand M. Makhija [ 2013 (12) TMI 1525 - KARNATAKA HIGH COURT] held that acquisition of more than one residential house by assessee out of capital gains would not dis-entitle assessee from availing benefit conferred u/s 54 We are of the opinion that revenue/ department have erred in denying exemption claimed u/s 54 of the Act insofar as the basement floor is concerned. Therefore, we direct the AO to give the benefit of exemption u/s 54 of the Act in respect of Basement Floor. Appeal filed by the assessee is partly allowed. - I.T.A. No. 2626/DEL/2017 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re of the assessee comes to Rs. 14,55,000/-) 2. S-505. G.K.-II, Basement 02/07/2008 10,00,000/- 3. G-66B. First Floor, Kalkaji 13/08/2008 20,00,000/- The assessee is not entitled for relief u/s 54 of 1.T. Act in respect of investment made by him in above three properties against long term capital gain. The assessee is entitled for exemption u/s 54 of the IUT Act against long term capital gain in respect of investment in one residential property. The assessee has acquired these properties in 3 different locations. The properties acquired are not adjacent and are not interconnected. The provisions of section 54 read as under: Subject to the provisions of sub-section (2), where, in the case of an assessee being an individual or a Hindu undivided family, the capital gain arises from the transfer of a long-term capital asset, being buildings or lands appurtenant thereto, and being a residential house, the income of which is chargeable under the head Income from house property (hereafter in this se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Kalkaji, New Delhi as calculated above- Rs. 22,33,769/- Less: Exemption u/s 54 as discussed above Rs. 20,00,000/- Long Term Capital Gain Rs. 2.33.7691- 4. As against the order of the AO, the assessee has preferred an appeal before the ld CIT(A). The ld CIT(A) vide order dated 27.12.2016, dismissed the appeal filed by the assessee. Aggrieved by order of the ld CIT(A) dated 27.12.2016, the assessee preferred the present appeal on the ground mentioned above. 5. We have heard parties, perused the record and giving thoughtful consideration. The ground No. 1 and 2 are regarding upholding short term capital gain arose on sale of residential property No. G-27, Ground Floor, Kalkaji, Delhi and upholding of Rs. 3,44,000/- as cost of acquisition instead of cost of acquisition of Rs. 16,75,000/- claimed by the assessee in computing capital gain on sale of residential property No G-27, Ground Floor, Kalkaji, Delhi. 6. While computing long term capital gain, the assessee has shown cost of acquisition of the property in the ground floor of Rs. 16,75,000/- on the ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 08) 24,75,0000 24,75,000 Indexed Cost of Acquisition 7,84,587 (As per Agreement to sell 2,41,231 (As per Power of attorney Capital Gain 16,90,413 22,33,769 Exemption u/s 54 16,90,413 20,00,000 Long Term Capital Gain Nil 2,33,769 9. After considering the various facts, the AO recomputed the long term capital gain on account of transfer of basement of Rs. 2,33,769/- instead of Rs. 16,90,413/- claimed by the assessee. Accordingly, the exemption claimed u/s 54 of the Act was restricted to Rs. 20,00,000/- only. The sole reason for rejecting the exemption claimed by the assessee is that the assessee is eligible to get exemption u/s 54 of the Act only in respect of one residential property. 10. We have heard the parties and perused the material on record. The exemption u/s 54 of the Act has been denied in respect of the basement floor on the ground that the benefit of exemption u/s 54 can ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 'a residential house. Therefore, the contention of the revenue that the assessee is not entitled to benefit of exemption under Section 54(1) of the Act in the facts of the case does not deserve acceptance. 12. In the case of Tilokchand Sons vs. ITO (2019) reported in 105 taxman.com 151 (Madras), the Hon'ble Madras High Court has held that where the assessee HUF sold its residential house and invested capital gain in purchasing more than one residential houses within stipulated time limit assessee would be entitled to benefit of exemption u/s 54 of the I.T. Act. 21. In our understanding, if the word 'a' as employed under Section 54 prior to its amendment and substitution by the words 'one' with effect from 01.04.2015 could not include plural units of residential houses, there was no need to amend the said provisions by Finance Act No.2 of 2014 with effect from 01.04.2015 which the Legislature specifically made it clear to operate only prospectively from A.Y.2015- 2016. Once we can hold that the word 'a' employed can include plural residential houses also in Section 54 prior to its amendment such interpretations will not change merely b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Dictionaries are not dictators of statutory construction where the benignant mood of a law, and more emphatically, the definition clause furnishes a different denotation. A statute cannot always be construed with the dictionary in one hand and the statute in the other. Regard must also be had to the scheme, context and to the legislative history. Words and expressions at times have a 'technical' or a 'legal meaning' and in that case they are understood in that sense. Judicial decisions expounding the meaning of words in construing statutes in pari materia will have more weight than the meaning furnished by dictionaries. (Principles of Statutory Interpretation by Justice G.P.Singh pages 279 and 280). It is in this background, it is necessary to understand the meaning of the word 'a' in the context in which it is used in the said Section. 10. The words a or an and the are called Articles. They come before nouns. There are two Articles - a (or an) and the. a or an is called the Indefinite Article, because it usually leaves indefinite the person or thing spoken of The is called the Definite Article, because it normally points out some pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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