TMI Blog2014 (4) TMI 467X X X X Extracts X X X X X X X X Extracts X X X X ..... der - Satisfied with reasoning and finding of CIT(A) – Decided against Revenue. - I.T.A .No.-4074/Del/2012 - - - Dated:- 18-10-2013 - R S Syal And Diva Singh, JJ. For the Appellant : Smt Anuradha Misra, CIT-DR For the Respondent : Shri O P Sapra, Adv. ORDER:- PER : Diva Singh This is an appeal filed by the Revenue against the order dated 07.05.2012 of CIT(A), Meerut pertaining to 2009-10 assessment year on the following grounds:- (1) Whether, in facts and circumstances of the case Ld. CIT(A) has erred in law in deleting the addition made on a/c of Long Term Capital Gain of Rs. 36,40,283/- by accepting additional evidences in the form of agreement between assessee's builder and financer and also the communication between assessee and builder in complete violation of sub- rules (1), (2) (3) of Rule 46A of IT Rules, 1962. (2) Whether, in facts and circumstances of the case Ld. CIT(A) has erred in law and fact in deleting the addition made on a/c of Long Term Capital Gain of Rs. 36,40,283/-in relying upon the above said agreement and communication wherein only the probable date of giving possession was mentioned but no possession was given. (3) W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,81,000/-. Long Term Capital Gain is shown at Rs.19,89,914/-. Deduction u/s 54F has been claimed for this entire amount on a/c of investment in the same house at Banglore as mentioned above. Thus total capital gain was as under :- 1. on sale of house 3100369 (sale consideration Rs.5400000) 2. on sale of plots 1989914 (sale consideration Rs.2481000) 5090283 Assessee has made investment in house at Banglore as under :- Advance to builder for house 4250000 Deposit in Capital Gain Scheme a/c 1450000 5700000 3. The AO taking note of the fact the original assets were sold on 13.06.2008 and 10.11.2008 was of the view that the house must have been purchased by 12.06.2010 for getting deduction u/s 54 of the Act on sale of house at Konark and by 09.11.2010 for deduction u/s 54F on sale of Sradhapuri as the sections required that the assessee must have purchased house within 2 years of sale of the original assets. However the AO found that the assessee had advanced monies to the builder on agreement and deposited money in capit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In this context, reliance has been placed upon the judgement of the Hon ble High Court in the case of CIT vs R.L.Sood (2000) 245 ITR 727 (Del.); CIT vs Sardrmal Kothari Another 302 ITR 286; the judgement of the Karnataka High Court dated 15.02.2012 in the case of CIT vs Sri Sambandam Udaykumar in IT Appeal No.175/2012; Mrs. Seetha Subramanian vs ACIT 56 TTJ (Mad.) 417 and Satish Chandra Gupta vs Assessing Officer (1995) 54 ITD 508 (Del.). It was also submitted that there is no relationship between the assessee and the builder as such there can be no occasion to consider any connivance. Moreover the builder it was submitted entered into financial arrangement with M/s J.M. Financial Asset Reconstruction Co. P. Ltd. who had committed funds to the builders and the builder had communicated that the construction of the flat allotted was under progress and the date of possession communicated by them was December 2012 and the builders had further demanded funds of Rs.14,17,352/ vide e-mail dated 10.03.2012 and the assessee was in the process of arranging the finance. 4.1. Considering the submissions the CIT(A) came to the following conclusions:- I have gone through the facts of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... After considering the totality of the facts and respectfully following the judicial pronouncements as referred to herein above, I hold that the appellant is eligible to get the benefit u/s 54/54F as claimed and the AO is not legally correct in withdrawing the benefit for the default of builders not to allow possession of the residential flat within stipulated time. I, therefore, direct the A.O to allow the deduction u/s 54/54F as claimed. 5. Aggrieved by this the Revenue is in appeal before the Tribunal. The Ld. CIT DR placed heavy reliance upon the assessment order. On query she stated that the factum of payment has not been doubted by the department and the only grievance of the Revenue as set out in the assessment order is that the assessee has not been give any possession of the flat or a house as per the requirement of the Statute and since the requirements of the Act are not fulfilled, the impugned order deserves to be set aside and the assessment order be upheld. 5.1. Ld. AR on the other hand relying upon the impugned order submitted that the builder is not known to the assessee and the arrangement is at arms length as such there can be no connivance presumed of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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