TMI Blog2018 (11) TMI 549X X X X Extracts X X X X X X X X Extracts X X X X ..... constructed the residential house within the period prescribed under section 54(1) of the Act. In the case in hand, there is no dispute with regard to the fact that the assessee had purchased within two years [the period prescribed u/s.54(F(1)] a new asset on 05/10/2009 from the date of transfer of the original asset. The Revenue has not cited or placed on record any contrary judgment by the Hon'ble Jurisdictional High Court or Hon'ble Supreme Court. Therefore, we hereby set aside the impugned order and direct the AO to re-compute the assessed income after granting the benefit of section 54F of the Act to the assessee. Addition in respect of the payments made by cash credit card - A.O. disallowed expenditure on the ground that expenses incurred do not relate to business of company - Held that:- Director of the company incurs expenditure for and on behalf of the company but for allowance of such expenditure, it is incumbent upon the assessee to prove the nature of expenditure and purpose of the expenditure and correlate with the business of the company. In the present case, the assessee has merely made a bald statement. The ledger account belonging to the company so submitted sp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A) failed to consider that these transactions were pertaining to the company and not to the appellant. Hence, the addition of ₹ 5,22,614/- is unwarranted and deserves to be deleted. 6. The appellant craves leave to amend, alter or delete any of the above grounds of appeal. 2. The facts giving rise to the present appeal are that case of the assessee was picked up for scrutiny assessment and the assessment u/s 143(3) of the Income Tax Act, 1961 (hereinafter called as the Act ) was framed vide order dated 31.3.2015. The A.O. during the course of assessment noticed that assessee had sold two plots on 27.2.2012 for a sale consideration of ₹ 30,00,000/-. It was noticed that these plots were purchased on 9.5.1995 for a sale consideration of ₹ 2,22,250/-. The A.O. sought explanation of the assessee as to why the capital gain arising from these sale of plots was not offered for tax. The explanation given by the assessee was not acceptable by the A.O. Therefore, he made addition of ₹ 23,79,120/- on account of long term capital gain not offered for taxation. Before A.O., the explanation of the assessee was that the assessee is entitled for deductions u/s 54F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cable to return filed u/s.139(4), but in the present case, the assessee has submitted the return u/s.139(l) and as such the deduction is not allowable u/s.54F. The Id. CIT(A) has upheld the contention of the Id.AO. Section 54F of the Act reads as under:- [Capital gain on transfer of certain capital assets not to be charged in case of investment in residential house. (1) [Subject to the provisions of sub-section (4), where in the case of an assessee being an individual or a Hindu undivided family], the capital gain arises from the transfer of any long-term capital asset, not being a residential house (hereinafter in this section referred to as the original asset), and the assessee has, within a period of one year before or [two years] after the date on which the transfer took place purchased, or has within a period of three years after that date [constructed, one residential house in India] (hereinafter in this section referred to as the new asset), the capital gain shall be dealt with in accordance with the following provisions of this section, that is to say,- (a) if the cost of the new asset is not less than the net consideration in respect of the original asset, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the money to the purchaser before the time limit prescribed u/s. 139(4) and got the property registered. In such an event, he would be entitled to get the deduction for the amount utilized for the purchase of house within the stipulated period. Attention is drawn to the judgment of the Hon. Gauhati High Court in the case of CIT V/s. Rajesh Kumar Jalan reported in 286 IT R p.274 and in the case of CIT V/s. Jagtar Singh Chawla 259 CTR p,388 (P H). The Pune Bench and the Hyderabad Bench have followed the said judgments. The copies of the judgments are enclosed from Page 71 to P.89 of the PB. The Indore Bench has taken a similar view in the case of Aftab Mohammad V/s. ITO (P.87 of PB). The Hon. Ahmedabad Bench in the case of Ashok Kapasiyavala V/s. ITO reported in 155 IT D p.948 have followed the judgment of the Hon. Punjab Haryana High Court in the case of CIT V/s. Jagtar Singh Chawla and the judgment of the Hon. Karnataka High Court in the case of CIT V/s. K. Ramchandra Rao and observed in Para 6.3 that the assessee purchased the new asset on 05.10.2009 after transferring the original asset on 08.01.2008. The assessee has purchased the residential house within a period of two y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Ld. Counsel are distinguishable on the facts. 6. We have heard the rival submissions, perused the materials available on record and gone through the orders of the authorities below. The claim of deduction was denied by the assessing officer on the basis that the assessee had filed its return of income on 29.9.2012 and plots were sold on 27.3.2012 for ₹ 30 lakhs and the assessee had purchased residential flat in Mumbai on 3.12.2012 for a sum of ₹ 2.57 crores. As per the provisions of the Act, the assessee was required to deposit the entire sale consideration in the claim of deposit of capital gain accounts on or before due date of filing of his return. This finding of the assessing officer is sustained by the Ld. CIT(A). Now moot question to be decided is whether the assessee would be entitled for benefit of section 54F of the Act even he does not deposit the sale consideration as contemplated u/s 54F(4) of the Act. The coordinate bench in the case of Ashok Kapasiawala Vs. ITO (supra) while relying upon the judgement of the Hon'ble Karnataka High Court in the case of CIT Vs. K. Ramachandra Rao (2015) 56 taxamann.com 163 held as under: 6.2. The Hon'b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt or Hon'ble Supreme Court. Therefore, respectfully following the ratio laid down by the Hon'ble Karnataka High Court in the case of CIT vs K.Ramachandra Rao (supra), we hereby set aside the impugned order and direct the AO to re-compute the assessed income after granting the benefit of section 54F of the Act to the assessee. 7. In the present case, the plot was sold on 27.2.2012. Due date of filing of return was 29.9.2012. Payment made to builder of ₹ 10 lakhs on 3.10.2012. Further payment made to the builder of ₹ 15 lakhs on 2.11.2012 and agreement for purchase was registered on 3.12.2012. It is the case of the assessee that the sale consideration was utilised within one year from the date of sale of the original asset. Under these facts, it is argued that in the light of the judgement of the Hon'ble Karnataka High Court and followed by the coordinate bench, the A.O. ought to have given benefit of the deduction u/s 54 of the Act. The revenue has not brought any contrary binding precedent in our notice, therefore, respectfully following the ratio laid down by the Hon'ble Karnataka High Court in the case of CIT Vs. K. Ramachandra Rao (supra), we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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