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2019 (1) TMI 1353 - AT - Income TaxExemption claimed u/s 54F - LTCG - nature of property acquired - residential house contemplated u/s 54F or acquisition of land per se - construction cost of superstructure constructed on the land is very marginal - whether the co-owned superstructure on a combined adjoining plots of land can be regarded as ‘residential house’ for the purposes of Section 54F? - Held that:- In the instant case the dominant object of the deployment of consideration is to acquire land parcel and not to enjoy the residential house per se. We are at loss to understand as to how the factual aspects like lack of basic amenity and a non-descript temporary makeshift shelter/superstructure of insignificant worth can convert a land into a residential house. The vast open land with naturally grown grass, a grossly asymmetric consumption of land for construction of superstructure (cost less than 1% of total costs), the occupation of the superstructure by a watchman/caretaker clearly indicates that such superstructure cannot be mechanically reckoned as a residential house. The existence of vast parcel of open land is a reality. We thus find it utterly difficult to put blinkers on tell-tale facts. The superstructure claimed to be a residential house is clearly superficial and does not go hand in hand with ground realities. It is totally unconceivable that a token and symbolic superstructure of temporary nature involving insignificant construction costs or land occupying negligible space (created with an object to typically accommodate a watchman to safeguard the land) would convert huge parcel of land into a residential house. As we see in nutshell, cost of land exceeds 99% of the total cost of new investment in so called residential house. Likewise, land used for construction of superstructure is less than 1% of total area. The superstructure is jointly owned and devoid of basic amenities and actually used by the caretaker of lands. The unflappable facts narrated above when seen cumulatively seals the narrative against the assessee. The sale consideration is thus essentially appropriated towards purchase of land per se and not towards construction of residential house as enjoined by S. 54F. We thus find no plausible reason to interfere with the conclusion drawn by the Revenue authorities. In the result, the grievance of the assessee towards disallowance of deduction under s.54F dismissed - Decided against assessee.
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