TMI Blog2017 (6) TMI 773X X X X Extracts X X X X X X X X Extracts X X X X ..... the date of sale of the old property on 26.09.2008. Otherwise also, anything that was purchased or constructed prior to 26.09.2007 was not eligible for deduction under section 54 of the Act. Thus, the assessee is not eligible for deduction under section 54 of the Act. The ld. CIT(A) has passed well reasoned detailed speaking order after analysing the documents and submissions made before him.- Decided against assessee - I.T.A.No.2289/Mds/2015 - - - Dated:- 3-4-2017 - Shri Chandra Poojari, Accountant Member, And Shri Duvvuru RL Reddy, Judicial Member For The Appellant : Shri V.S. Jayakumar, Advocate For The Respondent : Shri Supriyo Pal, JCIT ORDER PER DUVVURU RL REDDY, JUDICIAL MEMBER: This appeal filed by the assessee is directed against the order of the ld. Commissioner of Income Tax (Appeals) 4, Chennai dated 27.10.2015 relevant to the assessment year 2009-10. The assessee has raised two effective grounds viz., (i) the ld. CIT(A) has erred in holding that the notice issued under section 143(2) of the Income Tax Act, 1961 [ Act in short] was laid in law and (ii) the ld. CIT(A) has erred in confirming denial of exemption under section 54 of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In this case, the notice under section 143(2) of the Act was issued to the assessee on 24.08.2009, which was received back answer with the remark door locked. Thereafter, the Assessing Officer deputed the Inspector of his office to serve the notice on the assessee. The Inspector visited the place of the assessee on 30.09.2010 and found the door locked and, accordingly, he served the notice by way of affixture after obtaining the signatures of the two witnesses. Thereafter, the Ld. A.R. of the assessee has appeared before the Assessing Officer from time to time and had also submitted the Power of Attorney in her favour along with the submissions called for by the Assessing Officer as required for the completion of the assessment proceeding. 6.1 During the course of the appellate proceedings, the Ld. AR. submitted that that the assessee has objected to the assessment proceedings on the ground that proper notice was not served on her in time. It has been pointed out that whenever the assessee was out of station, the security guard would receive all the correspondences addressed to the assessee. The security guard had received the first notice only on 18.07.2011 which was handed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the ld. CIT(A) on this issue and accordingly, the ground raised by the assessee is dismissed. 7. The next ground raised in the appeal of the assessee is that the ld. CIT(A) has erred in confirming denial of exemption under section 54 of the Act. 7.1 During the year under consideration, the assessee sold her residential house for a consideration of ₹.74,00,000/-. While determining the Long Capital Gains, the assessee has claimed a deduction under section 54 of the Act to the extent of ₹.35,54,495/-, on account of purchase of a new residential house. From the details and the documents furnished by the assessee, the Assessing Officer has noticed that the assessee has utilised the sale proceeds of the house sold, for the repayment of loan availed from the lDBI Bank taken for the purchase of new house. Since, the provisions of section 54 of the Act allows deduction only if the sale proceeds of the old house (sold) are invested in acquiring the new residential property within the stipulated time limits. the Assessing Officer disallowed the assessee's claim of deduction under section 54 of the Act. In addition, the Assessing Officer also disallowed the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty was purchased in the year 2005. The details of purchase of the new house, as per the details filed by the appellant wide submissions dated 14.03.2013, are as under: - Land (i.e UDS) was registered on 18/05/2005 for a consideration of ₹.31, 84, 675/-. - Construction agreement with the builder dated 18th of November 2004 was for ₹.16,21,200/-. - Total loan availed from the lOBI bank for new house was at ₹.40,00,000/-. - Received the possession of the flat in October 2006. - The assessee occupied the property for self-occupation on 01.10.2008. - Date of repayment and close at of the loan account was 31.10.2008 and the amount to be paid to lDBI bank and closure of account was ₹.35,54,495/-. (iii) The old house property was finally sold on 26.09.2008 for a consideration of ₹.74,00,000/-. Out of the above sale-proceeds, an amount of ₹.35,54,495/-was utilised for repayment of loan to lDBI bank on 31.10.2008. After selling the old house property, the appellant moved to the new house property on 01.10.2008 and continued to reside there. 14. As per the provisions of section 54 of the Act, for calculating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the date of the payment. 17. In view of the above findings, the assessing officer has rightly concluded that the appellant was not eligible for deduction under section 54 of the Act. Therefore, the action of the Assessing Officer is confirmed. 18. The other issue is regarding the appellant's claim of cost of improvement and its indexation. The appellant in its return of income, while computing the taxable long Term Capital Gains, claimed the indexed cost of improvement at ₹ 16,88,879/-. As per the appellant, the cost of improvement is in the form of expenditure incurred on the interiors etc. However, as the appellant has failed to substantiate or prove the details and the extent of improvements carried out, with necessary evidences, the Assessing Officer disallowed the claim of cost of improvement and its indexation. The appellant, even before the undersigned, could not furnish any such evidences or details of the cost of the improvements except claiming that the old house which was sold, was very old and the appellant kept on incurring various expenses from time to time in the form of interiors etc. Hence, the appellant claimed that her claim should be allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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