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2012 (7) TMI 586 - AT - Income TaxAllowance of claim of deduction u/s 54 - joint holders of property - Held that:- Capital gain arising from the transfer of a residential house is not admissible against the investment in second house as the only restriction is that the capital gain arising from the sale of one residential house must be invested in one residential house and not in two residential houses - Unable to agree with the view taken by the CIT(A) that the two flats constituted one residential house. The flats were located in two different buildings owned by the two different housing societies and were situated on two different roads. These flats were acquired in two different years. There was no common approach road to the buildings. Therefore the two flats cannot be treated as one residential property only on the ground that two buildings in which the flats were located were within the walking distance as claimed by assessee - Assessee sells more than one residential houses in the same year and the capital gain is invested in a new residential house, the claim of exemption cannot be denied if the other conditions of section 54 are fulfilled - No rulings have been brought on record by the ld. DR to show that the capital gain arising from sale of more than one residential houses cannot be invested in one residential house - The only requirement of section 54 is that income should be chargeable to tax under the head "house property income" and it is not necessary that income should have been actually charged - direct the AO to allow the capital gain exemption u/s 54 after verifying that the new residential house had been constructed within prescribed time limit - partly in favour of revenue.
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