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2023 (1) TMI 711 - ITAT COCHINBenefit u/s 54F - Denial of benefit two houses in USA owned by the assessee had been considered by the CIT(A) for denying the deduction - HELD THAT:- A proviso must be construed harmoniously with the main statute so as to give effect to the legislative objective and the section should be read as a whole inclusive of the proviso in such manner that they mutually throw light on each other and result in a harmonious construction. The legislative intent behind granting relief to the assessee through section 54F is investments in residential house in India and therefore the proviso imposing the conditions cannot be read in isolation and should construed harmoniously with the main section. Accordingly the proviso to section 54F which contains the condition that the deduction is not available if the assessee owns more than one residential house, other than the new asset, should be interpreted to mean ownership of residential houses in India. Therefore the ground on which the deduction u/s.54F is denied that the assessee owns two residential houses in USA in our considered view is not tenable. We accordingly hold that the assessee is entitled for claiming deduction u/s.54F for investments made in India in one residential house within the time limit stipulated under the said section. In the case of DIT (International Taxation) v. Mrs. Jenifer Bhide [2011 (9) TMI 161 - KARNATAKA HIGH COURT] has considered a similar issue and held that to attract section 54 and section 54EC of the Act, what is material is the investment of the sale consideration in acquiring the residential premises or constructing a residential premises or investing the amounts in bonds set out in section 54EC and once the sale consideration is invested in any such manner out of the entire sale consideration that had flown from the assessee, then the assessee would be entitled to the benefit conferred under this provision. In our view the facts of assessee’s case needs to be examined based on evidences. We accordingly remit the issue back to the AO with a direction to verify the documents and evidences and allow the claim of the assessee with respect to the property acquired by the assessee out of sale consideration keeping in mind the ratio laid down by the Hon’ble Karnataka High Court.
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