Home Case Index All Cases Income Tax Income Tax + HC Income Tax - 2013 (1) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (1) TMI 545 - HC - Income TaxEntitlement to exemption u/s 54B - Appellant had 1/4th share in 1.10 acres of land in Ayyanthole Village sold for Rs.44 lakhs on 14.11.2004 - Whether the subsequent purchase of land (at Koothattukulam) in which a farm house is situated satisfied the requirements of Section 54F and/or Section 54B and thus there was no liability to pay any long term capital gains tax on the sale of land at Ayyanthole, in the AY 2005-06 ? - Held that:- Section 54F is intended to encourage construction of or acquisition of residential house with the aid of the proceeds from the transfer of any long term capital asset, which is not a residencial house. The provision contemplates computing the cost of the residential building, but the value of the plot on which the farm house stands and the land appurtenant could also be considered. The tribunal has categorically found that the appellant has not produced material to show that the entire area of 1.92 acres should be considered as land appurtenant to it. It is in such circumstances, the tribunal made an estimation and directed that the value of the plot on which the farm house is located and the land appurtenant be fixed as Rs. 2 lakhs. Thus unable to accept the contention of the appellant that the value of the entire land must be considered in arriving at the value of the residential building. No illegality committed by the tribunal. It is not open to the appellant to invoke Section 54B of the Act in regard to the rest of the land at Koothattukulam. This is for the reason that the appellant has not been able to satisfy the requirements of Section 54B with regard to the land at Ayyanthole as the appellant's late father had applied for sanction for construction of a compound wall before the Thrissur Urban Development Authority. The appellant had claimed in the return, exemption on the basis of Section 54F of the Act. But, during the assessment proceedings, the appellant relied on Section 54B of the Act. In other words, initially the appellant even did not have a case that the land at Ayyanthole was used for agricultural purposes. Therefore, at any rate, there can be no basis for invoking Section 54B for deducting the value of the land purchased at Koothattukulam - against assessee.
|