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2023 (1) TMI 357 - AT - Income TaxDeduction claimed u/s. 54 - delay in depositing unutilized amount in capital gains account deposit scheme - Scope of technical breach - HELD THAT:- In this case, the assessee has satisfied all conditions, except there is a technical breach in one of the conditions of depositing unutilized capital gain amount in capital gains deposit account scheme on or before due date for filing return of income u/s. 139(1) however, such deposits has been made on or before extended due date for filing return of income u/s. 139(4) - Admittedly, in the present case, the due date for filing return of income was on 05.08.2016, whereas, the appellant had deposited unutilized amount of capital gains in capital gain deposit account scheme on 19.09.2016, with a delay of 45 days. Assessee has explained reasons for depositing unutilized amount of capital gains in capital gain deposit account scheme, and further claimed that ultimately he has invested entire amount of capital gain for acquiring new asset within three years from the date of transfer of original asset. In our considered view, when the assessee has satisfied all conditions including depositing unutilized portion of capital gain in capital gain deposit account scheme, then for minor technical breach, benefit of deduction u/s. 54 of the Act cannot be denied. This view is fortified by the decision of various High Courts including the decision of Hon’ble Karnataka High Court in the case of CIT vs K Ramachandra Roa [2015 (4) TMI 620 - KARNATAKA HIGH COURT] held that when assessee utilizes entire sale consideration within three years from the date of transfer of land, he could not be denied exemption u/s. 54. In this case, there is no dispute with regard to the claim of the assessee, and is entitled for deduction, because the assessee has satisfied conditions prescribed therein u/s. 54 of the Act, and also deposited unutilized amount of capital gain in capital gain deposit account scheme in a nationalized bank. Though, there is a delay of 45 days, but the assessee has utilized full amount of capital gains for acquiring new residential house within three years from the date of transfer of original asset. Therefore, we are of the considered view, that the assessee is entitled for deduction u/s. 54 of the Act. The AO without appreciating facts disallowed deduction claimed u/s. 54 of the Act. Appeal of revenue dismissed.
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