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2018 (3) TMI 134 - AT - Income TaxSection 54EC deduction claim disallowed - Assessee jointly sold the capital asset in question in the relevant previous year on 26.10.2010 for ₹ 6,60,00,000/-. His 1/3rd share therein was of ₹ 2,20,00,000/-. He thereafter invested ₹ 1crore (supra) in NHAI bonds to claim Section 54EC deduction - decline of deduction as the said statutory provision caps the re-investment amount to ₹ 50lacs only, therefore restrict assessee’s claim to ₹ 50lacs to disallow the remaining equal amount - Held that:- We find no force in this approach above of revenue. Hon’ble Madras high court’s judgment in CIT vs. C. Jaichander (2014 (11) TMI 54 - MADRAS HIGH COURT) has admittedly upheld a co-ordinate bench’s decision that such a deduction claim of ₹ 50 lacs each spread over to two financial years but falling within six months of the capital asset’s transfer in question is very much allowable. The legislature has inserted second proviso to Section 54EC (1) introducing the above cap on re-investment quantum by the Finance (Act No.2), 2014 w.e.f. 01.04.2015 whereas we are dealing with assessment year 2011-12. This is not the Revenue’s case that the above amendment carries any retrospective operation. We therefore reject Mr. Kabra’s vehement contentions supporting the impugned disallowance. - Decided in favour of assessee.
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