TMI Blog2016 (6) TMI 1279X X X X Extracts X X X X X X X X Extracts X X X X ..... As per the proviso to section 54EC, the investment in any Financial Year is restricted to ₹ 50 lakh and since the assessee has made the investment of ₹ 50 lakh each in different two Financial Years but within six month from the date of transfer of the asset. - Decided in favour of assessee. - ITA NO.6642/MUM/2014 - - - Dated:- 9-6-2016 - Shri Joginder Singh, Judicial Member and Shri Rajendra, Accountant Member Revenue by Dr. Darsi Suman Ratnam-DR O R D E R Per Joginder Singh (Judicial Member) The Revenue is aggrieved by the impugned order dated 07/07/2014 of the ld. First Appellate Authority, Mumbai, on the ground that the Ld. Commissioner of Income Tax (Appeal) did not appreciate the fact that as per a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e facts discussed hereinabove, we find that the assessee sold shares leading to capital gains of ₹ 1,11,63,450/- and out of this amount rupees One crore was invested in REC Bonds on two dates namely ₹ 50 lakh on 31/03/2009 and remaining ₹ 50 lakh on 31/05/2009. The ld. Assessing Officer disputed the allowability of claimed exemption u/s 54EC of the Act, amounting to rupees One crore when the maximum limit for making investment u/s 54EC of the Act was ₹ 50 lakhs only. The stand of the assessee was that no restriction is specified for investing ₹ 50 lakh each in two different financial years, therefore, the Assessing Officer allowed the exemption only upto ₹ 50 lakh and disallowed for the remaining ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng from the transfer of the original asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of acquisition of the long-term specified asset bears to the whole of the capital gain, shall not be charged under section 45 : Provided that the investment made on or after the 1st day of April, 2007 in the long-term specified asset by an assessee during any financial year does not exceed fifty lakh rupees : [Provided further that the investment made by an assessee in the long-term specified asset, from capital gains arising from transfer of one or more original assets, during the financial year in which the original asset or assets are transferred and in the subsequent financial year does ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (b) a deduction from the income with reference to such cost shall not be allowed under section 80C for any assessment year beginning on or after the 1st day of April, 2006. Explanation.-For the purposes of this section,- (a) cost , in relation to any long-term specified asset, means the amount invested in such specified asset out of capital gains received or accruing as a result of the transfer of the original asset; (b) long-term specified asset for making any investment under this section during the period commencing from the 1st day of April, 2006 and ending with the 31st day of March, 2007, means any bond, redeemable after three years and issued on or after the 1st day of April, 2006, but on or before the 31st day of March, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bonds. Sub-section (1) speaks where the capital gain arises from the transfer of long term capital asset and the assessee has any time within a period of six months, after the date of such transfer, invest, the whole or any part of the capital gains in the long term specified asset, the capital gain shall be dealt with in accordance with the provisions of the section. The position has been clarified with insertion of explanation which speaks about cost in relation to any long term specified asst , means the amount invested in such specified asset out of the capital gains received or accruing as a result of the transfer of the original asset, meaning thereby, the date of receipt or accruing are the important dates for making investment. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 54EC of the Act. For the purpose of section 54EC, the date of investment is to be regarded as the dates of investment/ the payment received by the authorized bank. It is noted that section 54EC of the Act has no restriction if the specified investment of ₹ 50 lakh is made in two different financial years. The ratio laid down by the Mumbai Bench of the Tribunal in ITO vs Mr. Baldwin D.Fernandes (ITA No.5229/Mum/2013) order dated 19/10/2015, the Chennai Bench of the Tribunal in Smt. Sriram Indubai vs ITO, (ITA NO.1950/Mds/2012), order dated 31/01/2013. Thus, we are of the view, the exemption u/s 54EC of the Act is available to an assessee, if the long term capital gains, earned by the assessee, is invested in the specified long term ass ..... X X X X Extracts X X X X X X X X Extracts X X X X
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