TMI Blog2014 (6) TMI 364X X X X Extracts X X X X X X X X Extracts X X X X ..... applicability of CBDT Circular no. 471 dated 15-10-1986 is upheld - the circular finds further reinforcement by issue of CBDT Circular no. 672 dated 16-2-1993 - the assessee invested entire amount of capital gains towards purchase of new property remains unquestionable, thus, the exemption is clearly allowable the investment in flat irrespective of the delivery of possession by builder has been held to be investment in purchase or construction of new flat Decided against Revenue. Benefit of cost of improvement Held that:- Following BB. Sarkar Versus Commissioner Of Income-Tax, West Bengal IV [1981 (5) TMI 21 - CALCUTTA High Court] - the investment incurred towards improvement of the new house purchased by the assessee to make it h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o Rs. 73,27,000/- at MC 1-901 Moon Court Apartments Jay Pee Green Greater Noida (UP). (ii) 1/2 share in residential house at 1287, Sultan Singh Building, Kashmiri Gate, Delhi. The capital gains amounting to Rs. 52,84,500/- arising thereon were invested in a residential house at C-7/7, Model Town, Delhi as under: Consideration price as per sale deed Rs. 29,00,000/- Stamp Duty Rs. 1,74,000/- Brokerage paid Rs. 58,000/- Cost of improvement Rs. 25,14,700/- Total Rs. 56,46,700/- 4.1. Qua the investment in Jay Pee Green Greater Noida prop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... visional payment. A provisional payment cannot par take the character of purchase of flat. Reliance is placed on the ratio of decision in the case of Suraj Lamps Industries 340 ITR 1 (SC) for this proposition. 5.1. Apropos Kashmiri Gate issue, reliance is placed on the ratio of decision in the case of Kiran Bansal 3 ITR (Trib.) 180 (Del.) for the proposition that amounts similar to penalties paid for not starting the construction within the stipulated period and maintenance of property cannot be held as cost of improvement and exemptions u/s 54 cannot be allowed in this behalf. 6. Ld. Counsel for the assessee on the other hand vehemently argues that the reliance on aboe case laws placed by ld. DR are totally misconceived. In the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcular no. 672 dated 16-2-1993. Thus, the fact that the assessee invested entire amount of capital gains towards purchase of new property remains unquestionable, relying on Hon ble Delhi High Court, the exemption is clearly allowable. Order of CIT(A) is relied on. 6.3. Apropos second issue, ld. Counsel contends that it has not been disputed by lower authorities that the amount spent was towards improvement of the new flat to make it habitable. This issue is covered by the ratio of decision of Hon ble Calcutta High Court in the case of B.B. Sarkar. In that case an additional floor was constructed by the assessee as improvement of the property to make it habitable. Such cost of improvement to make the house habitable was held to be the amo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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