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2014 (9) TMI 1157 - AT - Income TaxExemption u/s 54 / 54EC - Long Term Capital Gains (LTCG) - The assessee has claimed exemption u/s 54EC by investing a sum in REC Bonds. He has further claimed exemption of a sum as invested in residential property and therefore, claimed exemption u/s 54 of the Income Tax Act - As per the AO, the window period for investment of capital gain, if any, accrued to an assessee on transfer of a property is of three years i.e. one year before the transfer of the property or two years after the transfer. Since the assessee had agreed to purchase the flat on 25.11.2006, which is much prior to the sale of the property i.e. 1.9.2008, therefore, it cannot be said that the flat was purchased just before one year of the sale of the property. Held that:- CIT (A) has erred in restricting the benefit u/s 54 to the extent the payments made within a period of one year for purchase of the new asset. The purchase of the new asset is to be considered either as May, 2008 or 15.10.2009 on that date total investment in the new asset is to be taken into consideration. The assessee has computed the capital gain on this basis and therefore, he is entitled for the exemption to the extent of the investment made in the purchase of new asset. - Decided in favor of assessee.
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