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2014 (12) TMI 606 - HC - Income TaxEntitlement to claim deduction u/s 54E Assessee covered under the scope of section 50 or not Deduction u/s 54E available only w.r.t. LTCG - Held that:- The Tribunal was rightly of the view that the concept of block of assets has been introduced from AY 1988-89 onwards and since Nagdevi property was no longer a business asset as on 1.4.1988, there was no occasion for the asset to enter the block of asset of the purposes of computing depreciation u/s. 32 as well as capital gain u/s. 50 hence, section 50 would not be applicable for the purpose of computation of capital gains - The Nagdevi property is obviously a long term capital asset assessee rightly relied upon Commissioner of Income Tax V. Aditya Medisales Ltd. [2013 (11) TMI 576 - GUJARAT HIGH COURT] - wherein it has been held that where capital gains arising on the transfer of a long term capital asset are invested in a specified asset, the assessee is not to be charged tax on the capital gains and the exemption provided u/s 54EC, cannot be denied to the assessee only on account of the fact that a deeming fiction is created u/s 50 - the legal fiction created u/s 50 of the Act is restricted to computation of capital gains and such deeming fiction cannot restrict application of section 54EC which allow exemption of capital gains, if the assessee makes investment in the specified assets thus, the order of the Tribunal is upheld Decided against revenue.
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