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2020 (9) TMI 238 - ITAT HYDERABADExemption u/s.54F - Assessee purchased property was remodified and all the assessee have invested the balance of the capital gain in the re-modification of the house and have thus, claimed the said amounts as ‘exempt’ u/s.54F - HELD THAT:- Amount spent on renovation of such residential house by an assessee according to his requirements is also allowable as exempt u/s. 54F as it would amount to construction of a residential house. The only other requirement is that the construction should be completed within three years from the date of transfer of the original asset. CIT(A) also agrees that the issue is covered in favour of the assessee by the decisions of the Hon'ble Karnataka and Calcutta High Courts but chooses to follow the decisions against the assessee. In the case of CIT Vs. Godavari Devi Saraf [1977 (9) TMI 24 - BOMBAY HIGH COURT] has held that - in the absence of a decision from the jurisdictional High Court, the decision of another High Court which is in favour of the assessee has to be followed. Hence, the order of the CIT(A) is not sustainable and the assessee’s claim of exemption u/s.54F has to be examined in the light of the details submitted by the assessee and the report of the valuer submitted by the assessee in the absence of sufficient details as the construction was allegedly done in the year 2006. Therefore, we deem it fit and proper to remit the issue back to the file of AO with a direction to allow the exemption u/s.54F of the Act in respect of the cost of the house, which is already purchased by the assessee on 29-03-2006 and also the amount spent on renovation/re-modification of the house. - Grounds raised by the assessee are treated as allowed for statistical purposes.
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