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2022 (9) TMI 291 - AT - Income TaxDeduction u/s 54F - assessee had computed the LTCG on sale of the property - Expenditure incurred on sale - HELD THAT:- We concur with the claim of the AR that now when it is proved beyond doubt that the expenditure involved towards purchase of stamp duty papers and registration expenses had been incurred by the assessee i.e. the seller, therefore, the lower authorities had grossly erred in declining her aforesaid claim for deduction of the said expenses. We, thus, in terms of our aforesaid observations allow the assessee’s claim for deduction of expenditure incurred towards stamp duty expenses - Although we have observed that the assessee’s claim for deduction of registration expenses is also to be allowed, however, in the absence of the requisite details before us we restore the issue to the file of the A.O with a direction to him to allow the same after making necessary verifications. Cost of Transfer - Admittedly, it is a matter of fact borne from record that the respective payments to the aforementioned persons have been made through banking channel. However, as observed by the A.O, and rightly so, we too are unable to comprehend as to why services of four persons would have been required to facilitate transfer of the property in question by the assessee. Although the confirmations of the aforementioned persons had been made available on record but the same does not inspire much of confidence. As is discernible from the aforesaid stereotype confirmations, it transpires that the same have been prepared by the assessee and had simply been signed by the persons concerned without mentioning a word about the services which were rendered by them as regards the sale transaction under consideration. We though are not oblivious of the fact that the payments to the aforementioned persons have been made through banking channel, however, the said fact on a standalone basis would not irrefutably substantiate the authenticity of the transaction under consideration. Apart from that the fact that the payments have been made to the aforementioned persons on 20.07.2011 i.e. much prior to 6 months from the date of execution of the sale transaction on 31.03.2012 also raises serious doubts as regards the veracity of the aforesaid claim of the assessee. Considering the aforesaid facts a/w the fact that the department have not carried the aforesaid issue any further in appeal before us, we finding no merit in the claim of the assessee for allowing her claim of deduction of the balance amount of commission/brokerage expenses reject the same and uphold the order of the CIT(Appeals) to the said extent. Claim of deduction u/s.54F - We are of the considered view that the assessee’s claim for deduction u/s.54F w.r.t investment made towards furnishing/additions/alteration of the new residential house for rendering the same habitable is in order and as per mandate of law. At the same time, we may herein observe that as the aforesaid claim of the assessee was principally rejected by the AO, therefore, he had no occasion to verify the genuineness and authenticity of the claim of expenditure that was incurred by the assessee. We, thus, in terms of our aforesaid observations though principally concur with the claim of the Ld. AR that that the expenditure incurred by her after purchase of the house for rendering it habitable would be considered as having been incurred for purchase of the said house and would be eligible for deduction u/s 54F, but restore the same to the file of the A.O for the limited purpose of verifying the veracity of the aforesaid claim of the assessee and limit her said claim of deduction to the extent the expenditure in question is incurred for rendering the new residential house habitable. Accordingly, the Ground of appeal No.2 is partly allowed for statistical purposes in terms of our aforesaid observations. Appeal of the assessee is partly allowed.
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