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TMI Blog2015 (10) TMI 1714X X X X Extracts X X X X X X X X Extracts X X X X ..... to allow the exemption claimed u/s 54 or alternative claim u/s 54F of the I.T. Act. 2.2. The learned CIT(A) failed to appreciate that the original property (Okkaiam Thoraipakkam property) sold by the assessee, on 3.7.2009, was only a vacant land, the sale of which will not qualify for deduction u/s 54 of the I.T. Act. 3.1. Without prejudice to the above ground of appeal, the learned CIT(A) erred in giving direction to grant deduction u/s 54F on the land cost and cost of construction of the building constructed in 'Malli Enclave", when the purchase of land as well as construction agreement were entered into much after the due date of filing the return of income for A.y. 2010-11. 3.2. The learned CIT(A) failed to appreciate the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income relating to assessment year 2009-10, where the rental income from house property was assessed to tax under the head "income from property". Further, the assessee demonstrated that an amount of Rs. 93 lakhs was invested under Capital Gains Scheme with a nationalized bank. Before the CIT(Appeals), the assessee has also made an alternative claim without prejudice to the rights, if the Assessing Officer considered the sale proceeds relating to vacant land, then exemption may be granted under Section 54F of the Act. The Assessing Officer without allowing exemption under Section 54 / 54F of the Act, brought the long term capital gains to tax. The assessee has complied with the conditions and provisions of Capital Gains Scheme by investing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntial house property, which qualifies for the exemption u/s 54F of the I.T. Act. However, the Assessing Officer has not considered the alternate claim of the appellant during the course of assessment proceedings." Considering the facts on record and on verification of the evidence filed, the CIT(Appeals) has directed the A.O. to allow the claim the exemption under Section 54 or alternative claim under Section 54F of the Act. 5. The Ld. Departmental Representative submitted that as per the findings of the Assessing Officer, only vacant land was sold and the assessee is not eligible for exemption under Section 54 of the Act and also concluded that the order of the CIT(Appeals) is erred in both law and facts. The CIT(Appeals) has relied on a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rd July, 2009. 7. We have heard the submissions of the parties and perused the material available on record as well as the orders of Revenue authorities. We are of the opinion that the provisions of Section 54 and Section 54F of the Act are beneficial provisions which are to be considered liberally as both are for construction of residential house properties within specified time. The assessee claimed exemption under Section 54 of the Act by purchasing land and construction of residential house which is not disputed by the Assessing Officer. 8. The only point of dispute arises is whether the property sold is a vacant land or residential house property. It was submitted before the CIT(Appeals) that the property, which was sold, was let out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omplied with the pre-conditions and also took the possession of the property on 30.05.2012 and there is no dispute of possession by the A.O. in the assessment order. Further, the Ld. D.R. relied on the judgment of Andhra Pradesh High Court in CIT v. Smt. Zaibunisa Begum (1985) 151 ITR 320, where Lordships have considered the issue in respect of transfer of building and land appurtenant, and the issue is on different facts where the construction was in a smaller area compared to the open land left on which the building is constructed. The same cannot be applied to the present case, as the assessee in toto has sold the land along with building. 9. In the aforesaid facts and circumstances, we are of the opinion that there is no infirmity in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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