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TMI Blog2023 (10) TMI 1230X X X X Extracts X X X X X X X X Extracts X X X X ..... firmity in the order of the learned PCIT invoking the jurisdiction u/s 263 - Decided against assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... such case is Coonjeevaram Krishnan. This decision is followed even by the Commissioners in appeal stage. The amendment to the provisions of Sec.54F has come subsequently. Thus, there no error in the claim made u/s. 54F or in allowing by the Assessing Officer, be that as it may, if the Honorable CIT clarifies as to what is the error in allowing the deduction and what short comings are there in the enquiries the assessee would submit the details required for such enquiries. Copy of the purchase "DEED" of 1995, Copy of the development agreement entered in 2012 and also the return of income with computation are submitted for ready perusal. As there is no error in view of the decisions of the ITAT and High Court it is to party that the proceedings u/s 263 may please be dropped". 5. However, the learned PCIT was not satisfied with the arguments advanced by the assessee. He referred to the provisions of section 54 F of the I.T. Act and observed that the assessee in the instant case has not fulfilled the conditions prescribed u/s 54F of the I.T. Act. He further noted that in this case, the developer viz., M/s. Ace Venture of India Pvt Ltd has entered into development agreement o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same was taxed wrongly for the assessment year 2015-16. The learned Principal CIT ought to have seen that no loss to Revenue arose for the year and accordingly initiation of proceedings u/s 263 of the I.T. Act is bad in law. 6. Any other ground that may be urged at the time of hearing. 8. The learned Counsel for the assessee strongly challenged the order of the learned PCIT invoking the provisions of section 263 of the I.T. Act. He submitted that in the instant case there is no loss of revenue and therefore, the twin conditions are not satisfied. Referring to page 2 of the Paper Book, he submitted that the assessee in the computation of total income has declared the estimated market value of flats constructed at Rs. 1,66,23,000/- and after claiming the indexed cost of land surrendered and investment u/s 54F computed the tax at Nil. Referring to the copy of the assessment order, he submitted that the Assessing Officer has verified the reply filed by the assessee giving the details of computation of total income, details of long term capital gain, form 26AS, bank account statement, development agreement, purchase deed copy etc. Referring to Page 17 to 18 of the Paper Book, he d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not have claimed the deduction u/s 54F and therefore, such order of the Assessing Officer has become erroneous and prejudicial to the interest of the Revenue for which he has invoked the provisions of section 263 and accordingly set aside the order to the file of the Assessing Officer for redo the assessment after giving an opportunity of being heard to the assessee. It is the submission of the learned Counsel for the assessee that it was a typographical error and the PCIT has not examined the issue in detail himself which he could have done and absolutely there is no loss to the Revenue. 11. We do not find any force in the argument of the learned Counsel for the assessee. It is seen from the letter addressed by the assessee to the Assessing Officer in response to the notice u/s 143(2) copy of which is available in the paper book that the assessee has categorically stated that she has sold all the flats for a consideration of Rs. 1,66,23,000/-. When the assessee has not held the flats for a minimum period of 3 years, the provisions of section 54F are not fulfilled and therefore, by allowing the claim of deduction u/s 54F, the order of the Assessing Officer has become erroneous as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The learned Principal Commissioner of Income-Tax ought to have considered the facts that exemption u/s 54F granted by the Assessing officer for the assessment year 2015-16, is not erroneous, particularly when the appellant satisfied the necessary conditions for allowing the deduction. 4. The learned Principal Commissioner of Income-Tax ought to have seen that the appellant is entitled for deduction u/s 54F as claimed by the appellant for the assessment year 2015-16 and, therefore, there is no error in the assessment order which is prejudicial to the interests of Revenue. 5. Without prejudice, the learned Principal CIT ought to have seen that the capital gain is not taxable for the assessment year 2015-16; that the same was taxed wrongly for the assessment year 2015-16. The learned Principal CIT ought to have seen that no loss to Revenue arose for the year and accordingly initiation of proceedings u/s 263 of the I.T. Act is bad in law. 6. Any other ground that may be urged at the time of hearing." 14. We have heard the rival arguments made by both the sides. A perusal of the submission filed by the assessee before the Assessing Officer shows that Shri Rajesh Kumar Jain has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner of Income-Tax erred in holding that there is error in the order of assessment made by the Assessing officer u/s 143(3) on 22.11.2017 and further erred in holding that the provision of Sec. 263 are applicable to the facts of the case. 3. The learned Principal Commissioner of Income-Tax ought to have considered the facts that exemption u/s 54F granted by the Assessing officer for the assessment year 2015-16, is not erroneous, particularly when the appellant satisfied the necessary conditions for allowing the deduction. 4. The learned Principal Commissioner of Income-Tax ought to have seen that the appellant is entitled for deduction u/s 54F as claimed by the appellant for the assessment year 2015-16 and, therefore, there is no error in the assessment order which is prejudicial to the interests of Revenue. 5. Without prejudice, the learned Principal CIT ought to have seen that the capital gain is not taxable for the assessment year 2015-16; that the same was taxed wrongly for the assessment year 2015-16. The learned Principal CIT ought to have seen that no loss to Revenue arose for the year and accordingly initiation of proceedings u/s 263 of the I.T. Act is bad in law. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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