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2010 (12) TMI 217 - AT - Income TaxCapital gain - exemption u/s 54 - new residential house - Disallowance of Rs. 95 lakhs claimed u/s 54 of the Act - AO disallowed the claim on the ground that (a) the return of income was not accompanied by the proof of deposit of Rs.95 lakhs made in State Bank ofIndia in Capital Gains Scheme (b) The property i.e., Trombay House, in respect of which the exemption was claimed, was not a residential house (c) The return of income was not filed u/s 139(1) but was filed u/s 139(4). - Held that: - the requirement of attaching the proof of having deposited the amounts in the specified capital gain account, with the return of income, is directory and as the assessee has furnished all the details during the course of assessment, no disallowance u/s 54 can be made on this count. Regarding nature of property - Factually for the assessment year 1997-98 Mr. Coelhi Peter Gasper has declared Rs.14,818 as income from house property in the return of income. In the last WILL and testament, the Trombay House is referred to as a residential property of ground and two upper floors at para 16 of the WILL. The vouchers of Bharat Petroleum Corporation describes the payment as made towards a residential premises. The Municipal Corporation of Grater Bombay levied municipal taxes on the ground that this is a residential property. The Secretary, Housing and Special Assistance Department, Govt. of Maharashtra, Mantralaya, Bombay has also considered it as residential property - All the above evidences clearly demonstrate that this is a residential property. - Decided in favor of assessee - AO directed to allow the deduction u/s 54. Section 54(2) requires that in case the capital gain is not appropriated by the assessee for purchase for a new asset or for constructing of the new asset before the date of furnishing the return of income u/s 139, he should deposit the same not later than the due date prescribed for filing a return of income u/s 139(1) in a specified bank account - The return shall be accompanied by proof of such deposit - The assessee produced the proof during the course of assessment proceedings and in such circumstances, in our humble opinion, the claim should be allowed - In the last WILL and testament, the Trombay House is referred to as a residential property of ground and two upper floors at para 16 of the WILL- Appeal is allowed
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