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2015 (12) TMI 1665 - AT - Income TaxEntitlement for deduction u/s. 54 in respect of one house only - Capital gains exemption in case of investment in a residential house property - Held that:- The comprehensive reading of circular 1 of 2015 made it clear that the exemption of LTCG is also available if investment made in more than 1 residential house. In view of the judgment in CIT vs. Chand M. Makhija [2013 (12) TMI 1525 - KARNATAKA HIGH COURT] and circular 1 of 2015 of CBDT, the assessee was not liable for LTCG against flat no.101 and the addition made by the AO which was sustained by the CIT(A) is deleted. Since ground no.1 of appeal has been allowed by us and holding of 2 flat are not to be treated as separate investment for allowing deduction u/s 54 of the Act, hence, ground no.2 has become infructuous. Addition of amount received on account of alternate accommodation - Held that:- CIT(A) while dealing with this addition has held that the assessee has not been able to prove any nexus between the rent received of ₹ 15,50,000/- and expenses claimed of ₹ 6,36,280/- and further held that in absence of such nexus, the expenses so claimed cannot be allowed, however, the same was sustained to the extent of ₹ 6,36,280/-. Assessee drawn our attention to page 11 of the development agreement wherein it has been clearly mentioned that the assessee is entitled to ₹ 15,50,000/- in temporary alternative accommodation to be acquired by the owners through their own efforts and their own choice. Since this compensation of ₹ 15,50,000/- has been shown as income under the head “Income from other Sources”, therefore, the assessee is entitled for deduction of expenses incurred for earning this income.We accordingly, direct the AO to allow the deduction of expenses claimed, on account of (i) rent paid ₹ 5,94,000/- (ii) Brokerage ₹ 27,280/- and (iii) Rent paid brokerage ₹ 15,000/-
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