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2023 (1) TMI 1075 - AT - Income TaxDeduction u/s 54F - delay on the part of contractor to complete the construction - CIT(A) allowing partial relief to the assessee in respect of amount spent towards construction of new property - HELD THAT:- Substantial portion of net consideration so received was re-invested within stipulated period from the date of transfer of capital asset. Certain amount was retained for construction of property whereas the remaining portion was offered to tax. It could also be seen that the assessee entered into construction agreement on 05.03.2012 wherein the contractor was required to complete the construction within a period of 12 months. Considering the same, the construction would have been completed well within the stipulated time - delay in construction is nowhere attributed to the assessee and the assessee could not be penalized for delay on the part of the contractor to complete the construction particularly considering the fact that the provisions of Sec.54F are beneficial provisions to promote investment in housing sector and encourage investments in acquisition of residential property. Once the assessee is found eligible to claim the same, the benefit should be granted to full extent as held in various judicial pronouncements. Therefore, the deduction could not be denied simply because there was delay on the part of contractor to complete the construction. The decision in CIT vs Sardarmal Kothari and Shanthilal Kothari [2008 (6) TMI 15 - MADRAS HIGH COURT]supports the case of the assessee. Depositing the unappropriated capital gains in capital gain account scheme before date of filing of return u/s 139(1) - CIT(A) has relied on the binding judicial precedent of Chennai Tribunal in ACIT vs T.S. Arunachalam,[2018 (1) TMI 1572 - ITAT CHENNAI]wherein it was held that it was enough if the assessee had invested substantial portion of net consideration in new asset within the stipulated period. No contrary decision has been placed on record. Further, from the factual matrix, it could be seen that the assessee has received the sale consideration in installments up-to financial year 2013- 14 and entire funds were not even otherwise available for the assessee to deposit the same into capital account scheme during this year. The assessee is only claiming part exemption. The same is evident from payment and investment schedule as extracted by us in preceding para- 4 of this order. - Decided against revenue.
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