TMI Blog2016 (9) TMI 949X X X X Extracts X X X X X X X X Extracts X X X X ..... No.1949/Mum/2012 - - - Dated:- 12-8-2016 - SHRI R.C.SHARMA, AM AND SHRI AMARJIT SINGH, JM For The Assessee : Shri Girish M. Balekundri For The Department : Ms. Arju Garodia ORDER PER AMARJIT SINGH, JM: The assessee has filed the present appeal against the order dated 22.09.2011 passed by the Commissioner of Income Tax (Appeals) 13, Mumbai [hereinafter referred to as the CIT(A) ] relevant to the A.Y.2005-06. 2. The assessee has raised the following grounds:- Assessee by: Shri Girish M. Balekundri Department by: Ms. Arju Garodia 1. The Assessing Officer as well as honorable commissioner appeal erred in considering the value of House property as ₹ 6,51,000/- against the actual consideration of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l house thereon, the aggregate cost should be considered for determining the quantum of deduction under section 54/54F, provided that the acquisition of plot and also the construction thereon, are completed within the period specified in these sections. 2. Section 54 specifies the house property :- As per Income Tax Act house property consist of house and land appurtenant there to, and being a residential house, the income of which is chargeable under the head income from house property. 3. The Assessing Officer as well as commissioner of appeal erred by not considering the section 27(1) of income tax act and disallowed investment in house property to the extent of 2/3rd of the amount as per section 27(1). As per section 27(1) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on for delay. 4. The brief facts of the case are that the assessee filed the return of income on 28.10.2005 declaring total income to the tune of ₹ 6,16,602/-. The return was accompanied by computation of total income, balance-sheet, profit loss account, audit report u/s.44A of the Income Tax Act, 1961 ( in short the Act ) in from no. 3CB and 3CD, etc. Thereafter the notices u/s.143(2) and 142(1) of the Act alongwith questionnaire, were issued and served upon the assessee. The assessee was carrying on professional marketing activities as management consultants and commission agents. The assessee has shown income from salary, business and other sources. The assessee shown long term capital gains on sale of unquoted shares of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,296/-. The CIT(A) has considered the 1/3rd amount of the construction to the tune of ₹ 6,51,786/- i.e.1,81,760/- for the deduction u/s.54 of the Act being the assessee was owner in possession of the property in question to the extent of 1/3rd share. 2/3rd share were held by the wife of the assessee as well as his son. It is not in dispute that for the purpose of exemption u/s.54F of the Act the assessee s share would only be entitled in view of the law settled by High Court of Bombay in case of Prakash Vs. Income Tax Officer Ors. (2008) 220 CTR 249 : (2009) 312 ITR 40. But it is not in dispute that the CIT(A) has only considered the cost of construction for the purpose of deduction u/s.54F of the Act to the extent of his 1/3rd shar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e thereon, the aggregate cost should be considered for determining the quantum of deduction under section 54/54F, provided that the acquisition of plot and also the construction thereon, are completed within the period specified in these sections 7. Apparently, in view of the said circumstances for the purpose of deduction u/s.54 or 54F of the Act, the land appurtenant on constructed house is liable to be considered for exemption. Therefore, in view of the said circumstances the purchase value of the house to the tune of ₹ 30,29,296/- is liable to be considered to the extent of the share of the assessee, therefore, we set aside the order of the CIT(A) on this issue and direct the Assessing Officer to reassess the deduction u/s.54 o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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