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2012 (9) TMI 796 - ITAT MUMBAIDeduction u/s 54EC - assessee entered into a development agreement in respect of jointly owned property with developer - sale proceeds arising out of the transfer of capital asset, was invested in specified bonds and exemption u/s 54EC was claimed - denial on ground that last payment of instalment received in pursuance of development agreement dated 21.9.2002, received on 28.3.2003 through cheque (returned back and redeposited on 16.4.2003) and the investment in the specified bond was made on 21.4.2003 and 26.4.2003, which falls beyond the period of six months, hence, not eligible for deduction u/s. 54EC - Held that:- Benefit of exemption intended in this section can only be given, unless and until the assessee receives the payment from transfer of a capital asset, otherwise it cannot be expected from an assessee to invest the same within the period prescribed. It will frustrate the entire purpose and spirit of the section itself. Looking to this hardship in a similar situation, the CBDT vide circular No.791 dated 26.2.2000 has clarified that such an investment can be made within the period of six months from the date of receiving of money from transfer of capital asset. Assessee’s claim for exemption u/s 54EC from capital gains, is allowed - Decided in favor of assessee.
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