TMI Blog2014 (11) TMI 727X X X X Extracts X X X X X X X X Extracts X X X X ..... r in the flat amounts to purchase or not – Held that:- In CIT Vs. T.N. Aravinda [1979 (10) TMI 1 - SUPREME Court] it has been held that the word ‘purchase’ in section 54(1) had to be given a common meaning, that is, buying for a price or equivalent of a price on by payment in kind or adjustment towards debt or for other monitory consideration - the elder brother would be entitled to relief u/s 54(1) – CIT(A) rightly held that Shri Gurdeep Singh, son of the assessee had made the payment of ₹ 1,22,38,750/-, towards the purchase consideration for the flat, which was reflected in his books of account and in his balance sheet before the date of sale of undivided share in the flat to his mother - The purchase agreement did not specify the shares of co-owners, that is, they are 1/3rd each - When the assessee had made the payment of ₹ 1,10,00,000/- to her son for purchasing of undivided share, it tantamount purchase only - the reasoning and the conclusion drawn by the CIT(A) is legally correct – Decided against revenue. - ITA No. 1791/Mum/2011 - - - Dated:- 12-11-2014 - Shri B. R. Baskaran And Shri Amit Shukla,JJ. For the Petitioner : Shri Subhash S. Shetty For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... son, Gurdeep Singh Bhatia and daughter-in-law Smt. Gurbir Kaur Bhatia, vide agreement for sale dated 28.12.2005. The assessee had made following payments to the builder in pursuance of the said agreement:- Date of Payment Mode of Payment Amount Paid 13.10.2005 By Cheque 5,00,000 16.05.2006 By Cheque 5,00,000 3. Thereafter the assessee entered into agreement for sale on 20.03.2007 with her son, Gurdeep Singh Bhatia for purchasing his undivided share for ₹ 1,10,00,000/- in the said flat, as per the following the payment Sl No. Cheque No. Date Name of Bank Amount 1 546409 18.06.2005 Union Bank of India 1,00,000 2 546410 19.07.2005 Union Bank of India 1,70,000 3 546412 16.12.2005 Union Bank of India 1,00,000 4 700784 08.03.2007 Union Bank of India 50,00,000 5 700786 20.03.2007 Union ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d.CIT(A) from pages 6 to 8 of the appellate order. The Ld.CIT(A) after examining the records and the submissions of the assessee held that, so far as the payment of ₹ 5,00,000/- made on 16.05.2006 is concerned the same falls within one year before the date of sale of original flat hence qualifies for exemption u/s 54. Therefore, to the extent of ₹ 5,00,000/- assessee is entitled for exemption and not for entire ₹ 10,00,000 as claimed by the assessee. Further after analyzing the purchase agreement of the flat and other records, Ld.CIT(A) found that Shri Gurdeep Singh, son of the assessee had made the payment of ₹ 1,22,38,750/-, towards the purchase consideration for the flat, which was reflected in his books of account and in his balance sheet before the date of sale of undivided share in the flat to his mother. The purchase agreement did not specify the shares of co-owners, that is, they are 1/3rd each. When the assessee had made the payment of ₹ 1,10,00,000/- to her son for purchasing of undivided share, vide agreement dated 07.02.2007, it tantamount purchase only. This conclusion was based on various decisions of the High Courts in the following mann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ghtly been denied by the AO. 7. On the other hand learned counsel for the assessee strongly relied upon the order of the Ld.CIT(A) and the decision of Hon ble Gujarat High Court in the case of CIT Vs. Chandan Ben Maganlal reported in (2000) 245 ITR 182. 8. We have heard rival submissions and also perused the relevant findings given in the impugned order. The assessee had purchased a residential flat on 08.01.1981, which was sold on 07.02.2007 for a sale consideration of ₹ 1,25,00,000/-. The long term capital gain on such sale amounted to ₹ 1,14,63,650/-. Before the said sale, assessee had entered into an agreement to purchase a residential flat, being flat no. 501 Elegant Orchid at Santacruz (west), Mumbai along with her son, Gurdeep Singh Bhatia and daughter-in-law, vide agreement dated 28.12.2005 and payment of ₹ 5,00,000/- was made. Another payment of ₹ 5 lakhs was made on 16.05.2006. This payment of ₹ 10 lakhs was claimed as exemption u/s 54, which has been restricted to ₹ 5 lakhs by the Ld. CIT(A). Thereafter the assessee had entered into an agreement with her son Gurdeep Singh Bhatia on 20.03.2007, who was the co-owner, for purchasing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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