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2017 (10) TMI 777 - AT - Income TaxDisallowance of transfer fees and brokerage expenses while computing long term capital gains on sale of said residential flat - Held that:- The explanation offered by the assessee that he was not informed by his AR about requirement of furnishing these documents before the AO and hence he did not furnish said evidences at the assessment stage is an plausible explanation which cannot be rejected at threshold to be not a reasonable or bonafide reasonable explanation more-so on perusal of invoices for both these expenses which are placed in paper book/page 72-74 the payments were made by the assessee through cheque/banking channel. The powers of learned CIT(A) is co-terminus with the powers of the AO and while deciding the appeal the learned CIT(A) should have caused enquiry of its own or directed AO to make an enquiry to verify bonafide and genuineness of the claim of the assessee instead of rejecting the claim of the assessee at threshold . We are of the considered view and direct that these additional evidences be and are hereby admitted in the interest of justice and matter be restored to the file of the AO for necessary verification / enquiry with respect to these additional evidences as to the bonafide and genuineness of the assessee’s claim on merits to be conducted by the AO and issue be decided on merits by the AO in denovo proceedings in accordance with law. Denied deduction to the assessee u/s. 54 - assessee has not purchased the residential flat within two years from the date of transfer /sale of residential flat on 17-02-2009 - Held that:- The allotment of flat by the Builder under self financing scheme has to treated as construction and period of three years window will be available for availing deduction u/s 54. The assessee has invested ₹ 26 lacs in new residential flat at ‘H’wing on 03-03-2011 i.e. within three years from the date of sale/transfer of flat on 17-02-2009 wherein substantial cost of the said flat was paid by the assessee as total cost was ₹ 32.76 lacs . The Builder later issued fresh letter of allotment on 15-10-2011 wherein the builder treated ₹ 26 lacs as part consideration towards said residential flat at ‘H’ Wing , which is again within three years from the date of sale of flat at Sahayadri Apartments by the assessee on 17-02-2009 on which income from long term capital gain arose. The assessee also paid through the builder service tax on the said payment of ₹ 26 lacs to the government which is duly acknowledged by the Builder. The Revenue also made direct enquiry with the builder and it could not be shown that these transactions are not genuine or are colourable device adopted by the assessee in collusion with the Builder to defraud revenue. The assessee has also brought on record government approvals for construction of ‘H’Wing on the plot developed by Builder. The assessee, thus got right, title and interest in the said flat within three years from the sale of flat on which the long term capital gain arose and the assessee will be entitled for deduction u/s 54. - Decided in favour of assessee.
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