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2017 (5) TMI 156 - AT - Income TaxDisallowance of claim u/s 54F of the Income Tax Act, 1961 - capital gains which was deposited in capital gain account - As per the Assessing Officer, the assessee has not utilized the capital gain till the stipulated period of three years expired on 31.01.2015 - The assessee claims that since there was a dispute on the property in J.P Nagar and therefore the assessee could not carryout the construction on the said plot and accordingly the assessee has offered the capital gain in the Assessment Year 2013-14 - Held that: - It is pertinent to note that in case the assessee could not invest the amount for purchase of new residential house or construction of new residential house before the date of furnishing the return of income, the amount shall be deposited by him in the capital gain account for availing the deduction under Section 54/54F of the Act - The consequence of non-utilisation of the capital gain within period of three years would lead to assessment of the capital gain to tax in the assessment year relevant to the previous year in which the three years expires. It is neither the discretion of the assessee nor the discretion of the Assessing Officer to assess the said amount to capital gain tax in the assessment year other than the year as provided in Section 54/54F and particularly as per proviso to sub-section (4) of the said section so long the amount is deposited in Capital Gain Account. Thus the addition made by the Assessing Officer for the year under consideration is not sustainable and the same is deleted. Appeal allowed - decided in favor of assessee.
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