TMI Blog2015 (2) TMI 624X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee can make the investment in two different financial years provided in a financial year the investment made did not exceed ₹ 50,00,000/-. Respectfully following the referred decision of the co-ordinate benches in Ram Aganval v. Jt. CIT [2001 (9) TMI 233 - ITAT BOMBAY-G ] and Ms. Rania Faleiro [2013 (11) TMI 518 - ITAT MUMBAI] , this issue is accordingly decided in favour of the assessee. Indexed cost of acquisition of the property - computation of LTCG - adopting the date of acquisition as date of inheritance of the property v/s date of acquisition by the person from whom the property has been inherited by the assessee - Held that:- As relying on CIT Vs. Manjula J. Shah [2011 (10) TMI 406 - BOMBAY HIGH COURT] wherein held th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ₹ 1 Crore from capital gains u/s 54EC of the I.T. Act, 1961. It was noticed by the Assessing Officer (hereinafter referred to as the AO) that the investment in the REC Bonds was made in two installments. The first investment of ₹ 50,00,000/- in the REC Bonds was made on 31.3.2009 and therafter of another ₹ 50,00,000/- on 30.4.2009. The assessee had thus claimed exemption of ₹ 1 Crore. The Assessee claimed that he had invested the funds within 6 months and therefore was entitled for exemption under Section 54EC. The AO noted that as per proviso inserted w.e.f. 1.4.2007 in Section 54EC(1), the Assessee could have made the investment only upto R.50,00,000/- and he could have therefore got exemption under Section 54EC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 54EC upto ₹ 50 lakhs only. The assessee's case, however, is that as per the proviso to section 54EC, investment made on or after 1st April, 2007 in the Long Term Specified Asset by an assessee during any financial year should not exceed ₹ 50 lakhs. The assessee's case is that since the property was sold on 22-10-2007 he could have invested in eligible investment within six months i.e. on or before 21-4-2008 in order in avail exemption u/s 54EC of the Act. There is no dispute about ₹ 50 Lakhs invested on 31-12-2007 in REC Bonds. The dispute is only about further investment of ₹ 50 lakhs in NHAI Bonds made on 26-05-2008. Since six months in this case involves two financial years, the assessee's case is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tember of the financial year he gets an opportunity to make an investment of ₹ 50 lakhs each in two different financial years and is able to claim exemption upto ₹ 1 Crore u/s 54EC of the Act. Since the language of the proviso is clear and unambiguous, we have no hesitation in holding that the assessee is entitled to get exemption upto ₹ 1 Crore in this case. This view of ours gets support from the following finding of the Hon'ble Supreme Court in the case of IPCA Laboratory Ltd. V. Dy.CIT [2004] 266 ITR 521/135 Taxman 594 (SC), wherein it has been held by the Hon'ble Supreme Court that- even though a liberal interpretation has to be given to such a provision the interpretation has to be as per the word ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exemption should be granted. In the case of Ram Aganval v. Jt. CIT [2002] 81 ITD 163 (Mum.), it has been held as under: In regard to claim of exemption under section 54F we may mention that it is found by the learned CIT(A) that the bank was closed on 31-8-1995 on account of strike as certified by the officials of the concerned bank from the certification given by the (Asst. Year 2008-09) bank officials, the assessee had approached the bank officials with the cheque for the amount of deposit on 30-8-1995 due to bank strike and the cheque was cleared on 1-9-1995. In this view of the situation, it can well be said that the deposit of the assessee was in accordance with the provision of statute as on the last date i.e. the 31-8-199 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the language of Section 54EC is clear and unambiguous and it leads to the interpretation that the assessee can make the investment in two different financial years provided in a financial year the investment made did not exceed ₹ 50,00,000/-. Respectfully following the above referred decision of the co-ordinate benches, this issue is accordingly decided in favour of the assessee. 7. Ground No.3 is regarding the levy of interest u/s 234 being consequential does not require any adjudication at this stage. 8. Ground No.4 of the appeal relates to the indexed cost of acquisition of the property. The AO computed the LTCG on the property sold by the assessee by adopting the date of acquisition as date of inheritance of the propert ..... X X X X Extracts X X X X X X X X Extracts X X X X
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