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2018 (11) TMI 860 - AT - Income TaxClaim of exemption u/s 54 - purchase of the new asset within a period of two years after the date on which the transfer took place or towards construction of a new asset within a period of 3 years from the date on which the transfer took place - utilization of the LTCG before the date of furnishing the ‘return of income’ u/s 139 - Held that:- Subsection (2) of Sec. 54 contemplates two situations viz. (a) a case where the assessee had appropriated the amount of LTCG towards acquisition of the new asset within a period of one year before the date on which the transfer of the original asset took place or for the purchase or construction of the new asset before the date of furnishing the return of income under Sec.139; and (b) a case where the assessee had not appropriated the amount of the capital gain before the date of furnishing the ‘return of income’ u/s.139, there he shall be eligible to claim exemption u/s 54 towards purchase of the new asset within a period of two years after the date on which the transfer took place or towards construction of a new asset within a period of 3 years from the date on which the transfer took place, subject to a rider that the assessee should have deposited the amount of capital gain in a CGAS account with a specified bank by not later than the ‘due date’ applicable in his case for furnishing the ‘return of income’ under sub-section (1) of Sec.139. We find that the case before us clearly falls within the sweep of the aforementioned first limb of sub-section (2) of Sec.54. As the assessee in the case before us had appropriated the amount of the LTCG towards purchase of the new residential property viz. Flat A-203, Crown @ Hiranandani, Thane on 22.04.2014 i.e before the date contemplated under Sec.139(4), thus by having utilized the LTCG before the date of furnishing the ‘return of income’ under Sec. 139, his claim of exemption under Sec. 54 is found to be in order. - decided against revenue.
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