TMI Blog2015 (12) TMI 704X X X X Extracts X X X X X X X X Extracts X X X X ..... the entire capital gain by purchase of a house or construction of the new house within the stipulated period, the benefit of sec.54F cannot be denied.Accordingly, if the assessee has constructed the new house and utilised the sale proceeds and capital gain within the period of limitation as provided u/s 54F, then the claim of the assessee u/s 54F cannot be denied. As regards the objections of the authorities below in respect of the assessee owning more than two residential houses and utilisation of the sale proceeds for construction of new house, we find that the assessee has produced relevant record in support of the claim along with affidavit. Prima facie it appears that the residential house at Kilpauk, Chennai was demolished on 18/5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant's case. 2. The learned CIT(A) is not justified in not giving an opportunity to the Appellant prior to passing of the appellate order which is against the principles of natural justice. 3. The learned CIT(A) is not justified in denying the exemption u/s 54F of the Act under the facts and circumstances of the Appellant's case. 4. The learned CIT(A) is not justified in holding that the property at Kilpauk, Chennai was not demolished before the sale of the vacant property at Mysore under the facts and circumstances of the Appellant's case. 5. The learned CIT(A) failed to appreciate that the property at Gedalahalli can by no stretch of imagination can be termed as a residential house fit for habitation in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed wrong fact without verifying the claim of the assessee. It was submitted that the property at Kilpauk, Chennai was already demolished on 18/5/2007 whereas the capital asset in question was sold by the assessee on 07/06/2007. Therefore, as on the date of sale of the capital asset in question the property at Kulpauk, Chennai was not in existence. The CIT(A) did not accept the claim of the assessee by recording reason that the assessee has not filed any proof of demolition of the property at Kilpauk, Chennai and further the CIT(A) has also doubted the utilisation of the sale proceeds of the existing asset for acquiring or construction of the new residential house. Aggrieved by the impugned order of the CIT(A), the assessee has filed this ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed a certificate issued by the Corporation of Chennai dated 23/7/2015 wherein the details of the status of property i.e. date of demolition and reconstruction approval as well as completion of the property and assessed to house tax, has been certified by the Corporation. The learned AR of the assessee has submitted that as per directions of this Bench, the assessee obtained the certificate and is being filed in support of the claim that on the date of sale of the existing asset, the residential house at Kilpauk Chennai was already demolished and therefore, the assessee was not having more than one residential house at the time of sale of the existing asset. Thus, the learned AR of the assessee has pleaded that in view of the evidence filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s per the provisions of subsec.( 4) of sec.54F, we note that this issue is now settled by the decisions of the Hon ble jurisdictional High Court in the case of Fatima Bai vs. ITO reported in (2009) 32 DTR (Kar) 243 and in the case of Smt.Vrinda P.Issac (supra). The Hon ble High Court in the case of Fatima Bai (supra) has held in paragraphs 7 to 12 as under: 7. The s. 54(1) declares that when the assessee sells any long-term capital asset, the assessee should purchase the building within one year before the transfer or within two years after the transfer by investing capital gains. In which event the assessee will not be liable for capital gain tax. 8. The s. 54(2) declares that within one year from the date of transfer if the cap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n. 12. The Gauhati High Court in CIT vs. Rajesh Kumar Jalan (2006) 206 CTR (Gau) 361 : (2006) 286 ITR 274 (Gau) has taken a similar view that the time-limit for deposit under the scheme or utilisation can be made before the due date for filing of returns under s. 139(4). Thus it is clear that if the assessee has utilised the entire capital gain by purchase of a house or construction of the new house within the stipulated period, the benefit of sec.54F cannot be denied. This view has been reaffirmed by the Hon'ble jurisdictional High Court in the case of Smt.Vrinda P.Issac (supra). Accordingly, if the assessee has constructed the new house and utilised the sale proceeds and capital gain within the period of limitation as pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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