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TMI Blog2024 (11) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... the capital asset, it cannot be a ground to deny the exemption claimed U/s. 54F. Hon ble Delhi High Court in the case of Balraj [ 2001 (12) TMI 51 - DELHI HIGH COURT] held that since the assessee has paid the complete consideration to vendor of the land, which is duly acknowledged by the vendor, merely because of the registration is pending, we are of the view that deduction allowable U/s. 54 of the Act should not be rejected . The condition precedent for claiming benefit under the said provision is the capital gain realized from the sale of capital asset should have been parted by the assessee and invested either in purchasing a residential house or in constructing a residential house. If after making the entire payment, merely because a registered sale deed had not been executed and registered in favour of the assessee before the period stipulated it cannot be denied the benefit of section 54F of the Act - See Sambandam Udaykumar [ 2012 (3) TMI 80 - KARNATAKA HIGH COURT] - Decided in favour of assessee. - Shri Duvvuru Rl Reddy, Hon ble Judicial Member And Shri S Balakrishnan, Hon ble Accountant Member For the Appellant : Sri C. Subrahmanyam, AR For the Respondent : Dr. Satyasa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ual having income from salary and income from house property besides income from capital gains filed her return of income for the impugned AY 2017-18 on 27/03/2018 admitting a total income of Rs. 16,15,580/-. The case was selected for scrutiny under CASS. Accordingly, statutory notices U/s. 143(2) and 142(1) of the Act were issued and in response to the notices, the assessee e-filed the information called for. During the assessment proceedings, the Ld. AO noticed that the assessee sold vacant land at Gollapudi, Vijayawada for a consideration of Rs. 5,40,31,000/-. Further, the assessee has also purchased a house property at Chennai for a consideration of Rs. 6,06,10,000/- and claimed deduction U/s. 54F of the Act. After considering the submissions of the assessee as well as the material available on record, the Ld. AO completed the assessment U/s. 143(3) of the Act and disallowed the assessee s claim of exemption U/s. 54F of the Act by holding that the impugned property was purchased by the assessee only on 17/12/2019, which is beyond the stipulated period of 24 months from the date of sale of the land. Accordingly, the Ld. AO determined the assessed income of the assessee at Rs. 3, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amp Industries (P) Ltd vs. State of Haryana (2011) 202 Taxman 607) (SC)]. 6. The Ld. CIT(A) has ignored the fact that an individual becomes the rightful legal owner of a property only when the sale deed is registered, which in the instant case was done on 17/12/2019. Therefore for all the purpose of law and for the purpose of section 54 of the Act purchase of the said property occurred only on 17/12/2019 when the sale deed was registered. The sale ie., purchase by the assessee can be said to have taken place on the date of execution of the sale deed and not on the date of the agreement of sale (Hall Adresons (P) Ltd vs. CIT (1963) 47 ITR 790 (Cal.)]. 7. Thus, it can be established beyond reasonable doubt that the assessee has purchased the new property (as required U/s. 54F of the Act) and become the legal owner (ie., title is conferred on him) of the said property in question only on 17/12/2019 which is when the sale deed was registered. Therefore, the relaxation from the charging of the LTCG to tax U/s. 54F of the act cannot be applicable to the assessee as the new asset was purchased ie., assessee becoming the legal owner of the said asset is much after, after the two years limi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made much prior to the stipulated time allowed U/s. 54F of the Act. The Ld. AR further submitted that the assessee has also taken over the possession of the property within the stipulated time and further more since the house property was let out, the rental income earned during the period was also offered in the return of income filed for the respective AY. The Ld. AR further submitted that subsequently on 17/12/2019 the house property was registered in the name of the assessee but, the date of registration of the property cannot be taken as the criteria to grant exemption U/s. 54F of the Act. According to section 54F of the Act, the property should be purchased within two years after the receipt of the sale consideration of transferred immovable property. The Ld. AR also submitted that in the present case, the entire sale consideration was paid by the assessee much prior to the date of possession of the property ie., 14/11/2016. This fact also reflects in the sale deed as well as in the agreement of sale. Further, the assessee has also taken over the possession of the property on 14/11/2016 and has let out the property and generated the rental income which was also reflected in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransactions of nature of General Power of Attorney Sales ( GPA Sales ) or Sale Agreement / General Power of Attorney / Will transfers ( SA/GPA/WILL transfers) do not convey title and do not amount to transfer - Held Yes. . However, this judgment of the Hon ble Supreme Court is not applicable to the facts of the present case on hand because there is no dispute with respect to the title. The Ld. DR also relied on the judgment of the Hon ble Kolkata High Court in the case of Hall and Anderson (P.) Ltd (supra). The crux of the issue involved in this case relates to the ownership of the property which is not the issue in the case before us. Therefore, this case relied on by the Ld. DR is not applicable to the facts of the case on hand. The core issue involved in the present appeal is whether the assessee has purchased the house property within the stipulated time mentioned U/s. 54F of the Act or not? On this issue, it is an undisputed fact that the assessee had paid the entire sale consideration on 14/11/2016 and the possession of the property was also given to the assessee on the same day itself. It is also an admitted fact that the assessee has let out the said house property and offe ..... 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