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2023 (5) TMI 1058 - AT - Income Tax
Deduction u/s 54B - ancestral property sale - land as sold was held by assessee in the status of HUF - property the agricultural land inherited - whether the agricultural land which is the ancestral property belonging to HUF and its subsequent sale and purchase of another agricultural land by the wife is eligible for deduction or not? - HELD THAT:- Investment in new capital asset as agricultural land u/s 54B was made in the name of wife of Karta as member of HUF, it is owned by the HUF and hence entitled to exemption u/s 54B of the Income Tax Act.
Availability of exemption u/s 54B to HUF (the assessee being the co-parcener) or restricted to individual only - Section 54B stand amended by Finance Act, 2012, having its effect from 01.04.2013, wherein, the HUF has specifically been incorporated by replacing the word "the assessee being an individual or a parents of his" with the words “the assessee being an individual or parents or Hindu Undivided Family" for agricultural purpose in the statue w.e.f. 01.04.2013, itself. Hence the amended provisions are applicable for the computation of Income for A.Y. 2013-2014. So the by implication of the said amended law, the assessee includes the HUF.
Hence, the exemption u/s 54B after amendment is available to HUF also. Hence the objections by the A.O. in this regards, that the section is not applicable to HUF misconceived.
Agriculture land has been held by the assessee in the status of HUF and as the land was purchased in the name of wife of the Karta as one of the members is eligible for exemption u/s 54B of the Income Tax Act. Assessee appeal allowed.