TMI Blog2015 (4) TMI 1255X X X X Extracts X X X X X X X X Extracts X X X X ..... of court receiver. The assessee, however, in the year 2005 had sold the unconstructed/under construction unit resulting in taxable long term capital gains. CIT(A) has categorically held, after appreciation of the factual matrix of the case, that the property transferred by the assessee could not be termed to be a residential house. The findings of the CIT(A) have been reproduced above. The provisions of section 54F are beneficial provisions enacted for the purpose of promoting the construction/purchase of residential houses. The property in question sold by the assessee could not be constructed by the builder for a sufficient long time and the same could not be categorised as residential house and therefore the claim of the assessee ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 263 of the Act on the ground that the claim of the assessee under section 54F was erroneous and prejudicial to the interest of Revenue. He, (CIT) vide order dated 23.03.2011 set aside the assessment order dated 12.11.2008 and directed the AO to make fresh assessment after verifying as to whether the asset transferred was other than the residential house and whether the deduction had been correctly claimed by the assessee under section 54F of the Act. In the set aside proceedings, the AO observed that the asset transferred by the assessee was a residential house and hence the claim of exemption under section 54F of the Act was not admissible to the assessee. He rejected the contention of the assessee that the transferred property i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mpletion of the tower project is progressing steadily. 3.2 Section 54F of the Act attracts on transfer of capital asset other than residential house. The term residential house has not been defined in the section or elsewhere in the Act. In the instant case, the core question that arises for determination, is whether the incomplete flat of the assessee falls within the ambit of 'residential house' as stated u/s 54F of the Act. The reasoning of the AO that residential house need not be uninhabitable is not only devoid of merit but misplaced as well, because the word 'residential house cannot be equated with a house which cannot used for residence. Incomplete flat, as in the present case of the assessee, is a property under c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be 'residential house' and, therefore, provisions of section 54F of the Act will get attracted in the instant case. The claim of the appellant for exemption u/s 54F of the Act is, therefore, justified in the law. The Assessing Officer erred in holding that that the asset transferred was a residential house, and in denying the exemption u/s 54F of the Act. This ground of appeal is, therefore, decided in favour of the appellant. 4. In view of the aforesaid finding, ground no 2 of the appellant becomes redundant and, therefore rejected. 5. In the result, the appeal is partly allowed. 4. Aggrieved by the above decision of the Ld. CIT(A) allowing the claim of the assessee, the Revenue has come in appeal before us agitating the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bay High Court. The Hon ble Bombay High Court had appointed a committee/receiver with a direction to complete the construction. The construction of the building was not complete up to Feb 2011 as has been gathered by the Ld. CIT(A) from the letter dated 17.02.2011 issued by the said committee of court receiver. The assessee, however, in the year 2005 had sold the unconstructed/under construction unit resulting in taxable long term capital gains. The Ld. CIT(A) has categorically held, after appreciation of the factual matrix of the case, that the property transferred by the assessee could not be termed to be a residential house. The findings of the Ld. CIT(A) have been reproduced above. The provisions of section 54F are beneficial pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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