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TMI Blog2024 (10) TMI 865X X X X Extracts X X X X X X X X Extracts X X X X ..... hs from the date of transfer of the asset. The second proviso was introduced precisely to eliminate the differential treatment on the basis of date of transfer and to eliminate the ambiguity in the provision of section 54EC. This amendment was effective only from 01.04.2015 for the assessment year 2015-16 and subsequent years and can t be extended to the current year as the legislature had not provided for retrospective application to the second proviso of section 54EC. AR has relied upon the decision of Coromandel Industries Ltd. [ 2014 (12) TMI 852 - MADRAS HIGH COURT] wherein held that exemption of Rs. 50 Lakhs each claimed in two financial years, within six months period from the date of transfer of capital asset, was eligible for exemp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4-15 on 30.07.2014 declaring total income of Rs. 2,19,54,960/- and subsequently a revised return with total income of Rs. 2,24,26,160/-. The assessment was completed under Section 143(3) of the Income Tax Act, 1961 (in short the Act ) on 29.11.2016 on total income of Rs. 2,74,26,160/-, wherein addition of Rs. 50 Lakhs was made on account of excess deduction claimed u/s. 54EC of the Act. 3. Aggrieved with the order of the AO, the assessee had filed an appeal before the First Appellate Authority, which has been decided by the ld. CIT(A) vide the impugned order and the appeal of the assessee was dismissed. 4. Now, the assessee is in second appeal before us and has taken the following grounds in this appeal: 1. The learned Commissioner of Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 271(1)(c) of the Act. 8. The learned CIT(A) erred in fact and in law in confirming the action of the learned AO erred in fact and in law in charging interest u/s. 234D of the Act. 5. Shri Milin Mehta, Ld. AR appearing for the assessee submitted that the assessee had sold an immovable property for a consideration of Rs. 4,86,86,000/- on 22.02.2014. The capital gain arising on the sale of the property was invested in Bonds of REC NHAI and exemption of Rs. 1 Crore was claimed u/s. 54EC of the Act. The Ld. AR explained that as per the provisions of Section 54EC of the Act, the assessee was required to invest the capital gains within a period of six months from the date of transfer of the long-term capital asset and that the quantum of investmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the investment of bonds as stipulated u/s. 54EC of the Act was cumulative investment in respect of each transaction of transfer of long-term capital asset. She contended that the law doesn t envisage differential treatment on the basis of date of transfer. She explained that the situation of investment in two financial years will arise only if the transfer was effected after 30th September. In the case where the asset was transferred during first half of the year, the investment can be made only in one financial year as the period of six months will expire during that year only. She submitted that the intention of the legislature from the very beginning was to allow investment of Rs. 50 lakhs only in respect of each transaction of trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this cap of total investment of Rs. 50 Lakhs was not applicable in the current year and as per the scheme of the Act the assessee was entitled to make investment of Rs. 50 lakh each in two financial years, within the outer limit of six months from the date of transfer of the asset. The second proviso was introduced precisely to eliminate the differential treatment on the basis of date of transfer and to eliminate the ambiguity in the provision of section 54EC of the Act. However, this amendment was effective only from 01.04.2015 for the assessment year 2015-16 and subsequent years and can t be extended to the current year as the legislature had not provided for retrospective application to the second proviso of section 54EC of the Act. 8. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring any financial year does not exceed fifty lakh rupees. In other words, as per the mandate of Section 54EC(1) of the Act, the time limit for investment is six month and the benefit that flows from the first proviso is that if the assessee makes the investment of Rs. 50,00,000/- in any financial year, it would have the benefit of Section 54EC(1) of the Act. 9. The Co-ordinate Bench of this Tribunal has also consistently held that the investment of Rs. 1 Crore claimed in two financial years was allowable as deduction. In the case of Shangar (supra) decided by the Co-ordinate Bench of this Tribunal on 20.12.2023, the assessment year 2014-15 was identical and it was held that the investment of Rs. 50 lakhs each in two bonds made on 31.03.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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