TMI Blog2013 (3) TMI 657X X X X Extracts X X X X X X X X Extracts X X X X ..... the stipulated conditions were not satisfied. 2. The facts revealed from the record are as under. The assessee is an individual and during the year under consideration sold plot of his land bearing Survey No. 700/2 at Nashik for sale consideration of ₹ 60 lakhs. 3. While filing the return of income the assessee claimed deduction u/s.54B on premises that the assessee has proposed to make investment in the Agriculture land. The AO rejected the claim of the assessee that the entire Capital Gain was exempted and brought to tax the net Long Term Capital Gain at ₹ 57,76,379/-. The assessee has challenged the addition before the Ld.CIT(A) by taking contention that instead of claiming deduction u/s.54F, the assistant of his tax consultant wrongly claimed the deduction u/s.54B while filing the return of income inadvertently. The assessee pleaded before the Ld.CIT(A) that the assessee is entitled for deduction u/s.54F of the Income-tax Act to the extent of ₹ 53,83,335/-, as the assessee has never sold any agricultural land nor proposed to invest in any agricultural land as stated hereinabove. 4. The assessee sold his plot for consideration of ₹ 60,00,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee, the Ld.CIT(A) accepted the plea of the assessee and allowed the claim u/s.54F. The reasoning and finding of the Ld.CIT(A) are as under: 8. I have carefully considered the facts of the case, the assessment order of the A.O. and the rival submissions. On perusal of the same, it has been noticed that the A.O. has ignored the claim of the appellant raised before him during the course of assessment proceedings that the appellant is entitled to deduction u/s. 54F of the Act. The A.O. has also ignored the claim of the appellant that in the return of income the assistant of Income-tax Practitioner has incorrectly claimed deduction u/s. 54B instead of deduction u/s. 54F of the Act. These facts are also mentioned by the appellant in the statement of facts and grounds of appeal filed with the appeal memo, copy of which has been forwarded to the A.O. The appellant has claimed that he has never claimed before the A.O. during the assessment proceedings that he is liable for deduction u/s.54B but has claimed that the deduction u/s. 54F is to be allowed. The issue to be decided in this appeal is whether on the facts and in law the appellant is entitled to deduction u/s.54F of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the due date of return specified u/s. 139 is to be deposited in notified capital gain account scheme to be utilized for purchase or construction of house property within prescribed time limit. v) The assessee should not own more than one residential house on the date of transfer of the original asset. vi) The assessee should not transfer new house within 3 years of its purchase or construction. In the case under appeal the assessee is an individual and has transferred long term capital asset which is a N.A. plot and hence first 2 conditions mentioned above are undisputedly satisfied. The third condition lay down that the assessee has to purchase residential house within 2 years or construct residential house within the period of 3 years. In the case under appeal the appellant has entered into purchase agreement of flat which was under construction as per registered agreement dated 30/12/2009 and has paid full payment of ₹ 55,91,740/- as appearing in the audited balance sheet as on 31/3/2010. In the case of the appellant the original asset was transferred as per registered sale deed dated 28/11/2007 and the assessee has purchased flat under construction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the third condition for claiming deduction u/s.54F of the Act. The fourth condition to be fulfilled is the appellant has to deposit the unutilized portion of sale proceeds of original asset in notified scheme upto the time limit for filing return u/s. 139 of the Act. The appellant has claimed that the time limit allowed u/s. 139(4) of the Act is to be considered. In the case of the appellant the time limit for filing return of income u/s. 139(4) is 31/3/2010 and the appellant has invested an amount of ₹ 55,91,740/- for acquiring flat before 31-03-2010. The proposition of law is supported by following decisions: i) CITVs. RajeshkumarJalan286ITR274(Gau) ii) Nipun Meherotra Vs. DCIT (2008) 113 TTJ 223 (Banglore) In these cases it has been laid down that for claiming deduction u/s.54/54F the amount of sale proceeds of me original asset transferred is to be deposited in notified capital gain account scheme upto the date of filing return u/s. 139(4) of the Act if the amount is not utilized for acquisition of residential house property. In view of the ratio laid down in the above stated decisions, I am of the considered view that the fourth condition stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... years. 7. In the present case, the assessee entered into purchase agreement of the flat with the builder on 30-12-2009 and availed the loan from the HDFC Bank to the extent of ₹ 50,00,000/- and bank paid ₹ 47,00,000/- directly to the builder in the month of March, 2010 on 31-03-2010. The assessee has made the total payment to the builder to the extent of ₹ 55,91,740/-, therefore, the issue before the Ld.CIT(A) was whether the assessee has fulfilled the condition of the time limit. Admittedly, the assessee made the payment beyond the period of 2 years from the date of sale of original asset i.e. 25-11-2007 but within 3 years he has made the investment by availing the loan from the HDFC Bank to the extent of ₹ 47,00,000/-. We find that the assessee s case is identical to that of Mukesh G. Desai (HUF) Vs. ITO, (2009) 18 DTR 71 (Mum). Another aspect to be considered here is in respect of one of the conditions that unutilized portion of the sale proceeds of original asset is to be deposited in the notified scheme up to the time limit for filing of the return of income u/s.139 of the Act. The assessee contended that the time limit up to which the return can be ..... X X X X Extracts X X X X X X X X Extracts X X X X
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