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2014 (9) TMI 495 - AT - Income TaxRestriction of amount of exemption u/s 54EC – investment in two financial year totaling ₹ 1 crore - LTCG on sale of factory land - Held that:- The Long Term Capital Gain accrued to the assessee on transfer of Long Term Capital Asset on 01.01.2008 - The assessee invested ₹ 50 lakhs on 29.02.2008 i.e. FY 2007-08 and ₹ 50 lakhs on 30.06.2008 i.e. FY 2008-09 - the assessee invested in ₹ 1 crore in specified bonds which are eligible for deduction u/s 54EC of the Act within six months from the date of the transfer of capital asset giving rise to Long Term Capital Gain in the hands of the assessee - A reading of the Circular No.3/2008 dated 12.03.2008 issued by CBDT shows that the proviso has been inserted to limit the investment in eligible bonds to an amount of ₹ 50 lakhs in a financial year and the proviso does not limit the amount of exemption u/s 54EC in a financial year to an amount of ₹ 50 lakhs - the proviso to section 54EC does not limit the amount of exemption which is available as per provision of section 54EC – relying upon Vivek Jairazbhoy v. Dy. CIT [2014 (9) TMI 419 - ITAT BANGALORE] - the lower authorities were not justified in not allowing exemption u/s 54EC to the assessee in respect of investments made in specified capital bonds of ₹ 1 crore which were within the limit of proviso to section 54EC i.e. ₹ 50 lakhs in a financial year and were within the specified period of six months – thus, the order of the CIT(A) is set aside and the AO is directed to allow exemption to the assessee u/s 54EC in respect of both the investments i.e. ₹ 50 lakhs on 02.08.2008 and ₹ 50 lakhs on 30.06.2008 – Decided in favour of assessee.
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