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2020 (9) TMI 673 - HC - Income TaxReopening of assessment u/s 147 - change of opinion - whether AO had not formed any opinion in the first instance on the issue relating to transferred capital assets? - whether Tribunal was justified in quashing the re-opening of the assessment? - land fell within the limits of the Corporation of Chennai and the classification cannot be a agricultural land - HELD THAT:- We found that the assessee vide letter dated 06.01.2014 during the original assessment proceedings had brought the entire details about the sale of the land in Uthandi Village and also noted the fact that the Gazettee notification issued by the Government of Tamilnadu was very much available when the original assessment was completed and the assessing officer had no new tangible material to clarify its reopening. By relying upon the decision in the case of NKV Krishna 2013 (9) TMI 1258 - ITAT CHENNAI it was held that the land sold was an agricultural land. A crucial aspect was taken note of the Tribunal, i.e., in the case of assessee's spouse, who was also co-owner of the very same property, the property was treated as agricultural land and the assessment was completed under Section 143(3) and the said finding remain undisturbed. The above will clearly show that the re-opening of the assessment in the instant case was a clear case of 'change of opinion' and the Tribunal was justified in allowing the assessee's appeal. Eligibility of the assessee to claim deduction u/s 54(F) - property, which was a residential property was let out for commercial purpose to run the restaurant - HELD THAT:- There are several instances where residential properties are put to use for non-residential purposes and this cannot be a test to decide the nature of the property under the provisions of the Income Tax Act, especially, in assessee's case, where the letting out of the property for non-residential purpose was much after the purchase on 03.02.2011 and the lease agreement was on 21.03.2011. So far as the Wealth-Tax assessment is concerned, it may be true that in the assessment, the property is shown as commercial complex, as on the relevant date, 31.03.2011, the property was leased out for commercial purpose. Therefore, the Tribunal was right in holding that the assessee would be entitled to claim deduction under Section 54F of the Act and also rightly restricted to the residential portion only. - Decided against revenue.
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