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2019 (5) TMI 534 - AT - Income TaxDisallowance of deduction u/s 54F - whether the new asset is purchased or constructed? - as per AO assessee has not purchased the house in the present case but has made payment installment to the builder for construction of the property thus flat cannot be considered as a “new asset” - whether the acquisition of an apartment under a builders buyers agreement wherein the builder gets construction done in a phased manner and the payments are linked to construction are a case of purchase of a new asset or construction of new asset ? - HELD THAT:- As decided in KULDEEP SINGH [2014 (8) TMI 463 - DELHI HIGH COURT] acquisition of an apartment under a builders buyers agreement wherein the builder gets construction done in a phased manner and the payments are linked to construction is a case of purchase and not construction of new asset. Whether the construction of the house property if commenced before the date of the sale of the original asset whether the assessee is entitled to deduction u/s 54F of the income tax act or not? - As decided in BHARTI MISHRA [2014 (1) TMI 446 - DELHI HIGH COURT eligibility criteria laid down in an exemption notification are required to be construed strictly, once it is found that the applicant satisfies the same, the exemption notification should be construed liberally - Section 54F is a beneficial provision and is applicable to an assessee when the old capital asset is replaced by a new capital asset in form of a residential house - Once an assessee falls within the ambit of a beneficial provision, then the said provision should be liberally interpreted In the present case assessee has purchased a house property i.e. a new asset and is entitled to exemption u/s 54F of the act despite the fact that construction activities of the purchase of the new house has started before the date of sale of the original asset which resulted into capital gain chargeable to tax in the hands of the assessee. Accordingly we reverse the order of the lower authorities and direct the assessing officer to grant deduction under section 54F - Decided against Revenue.
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