TMI Blog2015 (5) TMI 888X X X X Extracts X X X X X X X X Extracts X X X X ..... p of residential house/s only of the assessee, and on a particular date. Thus no warrant in law and, accordingly, no merit in the Revenue’s case for disregarding the gift of a house property by the assessee to her spouse prior to the transfer date (of the original asset) for the purpose of reckoning eligibility to exemption u/s.54F of the Act. We decide accordingly. - Decided in favour of assesse. - I.T.A. No. 7091/Mum/2012 - - - Dated:- 10-4-2015 - SHRI D. MANMOHAN AND SHRI SANJAY ARORA, JJ. For The Appellant : Shri Tarun Ghia For The Respondent : Shri Love Kumar ORDER Per Sanjay Arora, A. M.: This is an Appeal by the Assessee directed against the Order by the Commissioner of Income Tax (Appeals)-13, Mumbai ( CIT(A) for short) dated 08.10.2012, dismissing the assessee s appeal contesting its assessment u/s.143(3) of the Income Tax Act, 1961 ( the Act hereinafter) for the assessment year (A.Y.) 2009-10 vide order dated 14.11.2011. 2. The facts of the case are simple and largely undisputed, so that it is only a question of the application or otherwise of the relevant provision of law to the facts of the case. The assessee, a co-owner (along with he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A), who confirmed the disallowance of the assessee s claim u/s. 54F, relying on the decision in the case of G. K. Shetty vs. ITO [2008] 112 ITD 103 (298 ITR (AT) 49 (Pune)/copy on record). Aggrieved, the assessee is in second appeal. 3. Before us, the assessee s case remained the same. In addition, the Authorized Representative (AR) relied on the decision in ITO vs. Rasiklal N. Satra [2006] 98 ITD 335 (Mum). The owner of a residential house (i.e., the new asset) in section 54F implies a complete residential house and not a shared, even if undivided, interest in the residential house. When a property is owned by more than one person, it cannot be said that any of them is the owner of the property. No single person can, of his own, sell the entire property. Joint ownership is different from absolute ownership, and it is only the latter, which means ownership to the exclusion of all others, that is contemplated u/s.54F. In view of the said decision, it was argued that the condition of proviso to section 54F, which proscribes ownership of more than one residential house, i.e., other than the new asset, on the date of the transfer of the capital asset under reference, is not violat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... han one residential house, other than the new asset, on the date of transfer of the original asset; or (ii) purchases any residential house, other than the new asset, within a period of one year after the date of transfer of the original asset; or (iii) constructs any residential house, other than the new asset, within a period of three years after the date of transfer of the original asset; and (b) the income from such residential house, other than the one residential house owned on the date of transfer of the original asset, is chargeable under the head Income from house property . Explanation.-For the purposes of this section,- net consideration , in relation to the transfer of a capital asset, means the full value of the consideration received or accruing as a result of the transfer of the capital asset as reduced by any expenditure incurred wholly and exclusively in connection with such transfer. (2) Where the assessee purchases, .. (3) Where the new asset is transferred within a period of (4) The amount of the net consideration which is not appropriated : Provided that if the amount deposited under this sub-section is not utilised . 4.2 As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tial flat) gifted by her to her husband on 03.10.2008. Even if the same is for the purpose of enabling availing benefit under section 54F, we cannot by any score treat as not valid in the eyes of law. The law does not oblige a person to pay maximum taxes or authorize disregarding a lawful transaction if the same has the effect of reducing his tax liability. The transfer is by no means sham or bogus, notwithstanding that the assessee would continue to reside with her family, including her husband, in the said house, i.e., both before and after its gift to her husband. That is, true, the assessee, along with her family, including her husband, continues to reside in the Gope Niwas Bldg., both before and after the gift, so that the same has no purpose apart from the change of the ownership, which is to be reckoned as on the date of the transfer (of the original asset, i.e., 06.10.2008). Whether, therefore, the change of the ownership was effected a few days or, why, even a day earlier, to the relevant date, is of no moment. The gift deed, duly registered, has to be given its full legal fact, which is of a change in its ownership from the assessee to her husband, Shri Ashok Vishindas Aj ..... X X X X Extracts X X X X X X X X Extracts X X X X
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