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2016 (10) TMI 244 - AT - Income TaxRevision u/s 263 - exemption u/s 54 - Held that:- We find that the assessee purchased flat vide agreement dated 20.4.2004 after making payment of ₹ 16 lakhs being purchase consideration by means of two cheque drawn on HSBC Bank M G Road, Mumbai the details whereof have already been mentioned above and also taken over the physical possession of the flat simultaneously. We further noted that the first agreement which was executed on the plain paper was reduced on non judicial stamp paper on 13.5.2004. The letter filed by the AR at page 16 which was acknowledged by the office of AO on 25.10.2010 and the AO after considering this agreement came to the conclusion that the assessee has held the flat for more than 36 months and accordingly resultant capital gain on sale of the said flat being LTCG as claimed by the assessee and allowed the exemption u/s 54 of the Act . Thereafter we noted that the ld. CIT(A) by exercising the revisionary powers u/s 263 issued show notice dated 13.3.2013 to the assessee on the ground that the sale of flat had resulted into to STCG as it was held for a period of less than 36 months by taking the date of purchase of the fat as 13.5.2004 which is second agreement which was executed on Non-Judicial Stamp Paper and observed that deduction 54 of the Act was wrongly allowed to the assessee and held that this has resulted into under assessment of ₹ 21 lakhs thereby passing an assessment order being erroneous and prejudicial to the interest of revenue and set aside the order of AO for limited purposes to pass appropriate order after examining all the facts of the case. In this case, we find that the by considering the date of purchase of the first agreement on which the flat was sold and the possession was taken ,the AO has taken the possible view that the flat was purchased on 20.4.2004 as is apparent from the facts as discussed above. The assessee has made LTCG of ₹ 21 lakhs on the sale of flat which was claimed exempt u/s 54 of the Act and was allowed by the AO after considering various documents placed before him during the course of assessment proceedings. In our opinion, no prejudice is called to the revenue and the order passed by the AO is neither erroneous nor prejudicial to the interest of the revneue as the AO has taken a correct view on the basis of documents furnished by the aseseee. Accordingly, we set aside the order of Commissioner passed u/s 263 of the Act by allowing the appeal of the assessee.
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