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2013 (7) TMI 110 - ITAT DELHIEntitlement to Exemption u/s 54F - AO rejected the claim as the assessee had not acquired substantial domain on payment of consideration for the apartment - CIT(A) allowed the claim - Held that:- A bare perusal of Section 54F(1) (supra) shows that the requirement of the Section is, as relevant for the present case, ‘purchase’ of a residential house in accordance with the said Section. Ownership and possession thereof has nowhere been delineated in the Section. Now, ordinarily, ‘purchase’ would take in itself ownership as well as possession. However, the obtaining situation has been amply dealt with by the Hon’ble Supreme Court in ‘Aravinda Reddy’ (1979 (10) TMI 1 - SUPREME Court), wherein, it has been held that the word ‘purchase’ in Section 54F(1) of the Act must be given its common meaning as buying for a price or payment; and that in the Section there is no stress on cash and carry. In the present case, once the assessee had admittedly paid the entire consideration for the purchase of the residential premises even before the capital gain accrued to him, the requirements of Section 54F(1) are amply met. For the deduction under the Section, nothing further is required. CIT (A) correctly held that Section 54F is a beneficial provision designed to promote re-investment of sale proceeds of long-term capital assets in residential house properties; that its purpose is to give impetus to the house building activity in order to meet the acute shortage of housing and for this purpose, providing an incentive to tax payers by exempting from tax long-term capital gains arising from the transfer of other assets where the net consideration is invested by the tax payer in residential house. In favour of assessee.
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