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2017 (9) TMI 1099 - AT - Income TaxExemption u/s. 54EC - investment in tax exemption bonds of ₹ 50 lakhs in one financial year and further ₹ 50 lakhs invested in next financial year, but within the stipulated period of six months from the date of sale of the asset - Held that:- A similar issue has been considered in CIT vs Coramandel Industries Ltd (2014 (12) TMI 852 - MADRAS HIGH COURT) wherein observed that it is clear from the First Proviso to section 54EC(1) that the time limit for investment is six months from the date of transfer and even if such investment falls under two financial years, the benefit claimed by the assessee cannot be denied. It would have made a difference if the restriction on the investment in bonds to ₹ 50 lakhs is incorporated in section 54EC(1) of the Act itself. The ambiguity has been removed by the legislature wef 01-04- 2015 in relation to AY 2015-16 and subsequent years. In yet another case, the Hon’ble Madras High Court has taken a similar view and observed that before amendment to provisions of section 54EC(1) by the Second Proviso wef AY 2015-16 and subsequent years, the law is clear in respect of investment in 54EC and hence even if the assessee invests more than the prescribed amount in one financial year or two financial year, if such investment is within a period of six months from the date of sale as provided in section 54EC(1), then, the assessee is eligible for exemption u/s 54EC. In this view of the matter the assessee is eligible for investment in tax exemption bond u/s 54EC for the entire amount if such investment is made within six months from the date of sale. Therefore, we direct the AO to allow exemption u/s 54EC to the total investment made by the assessee. - Decided in favour of assessee.
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