TMI Blog1997 (8) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... Surya Nagar, Agra, and that he was entitled to exemption out of the capital gain from the sale of the house at Golf Link to the extent of the cost of construction of the house at 64, Surya Nagar, Agra ? 2. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that for availing of the benefits under section 54 of the Income-tax Act, 1961, it is not necessary that the construction of the new house should begin after the sale of the old house ? 3. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that for availing of the benefits under section 54 of the Income-tax Act, 1961, it is not necessary th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 54 of the Act. The Income-tax Officer, however, took the view that the assessee had started construction of this house prior to the sale of the Golf Link house. He, therefore, rejected the alternative contention too of the assessee. On appeal, the Appellate Assistant Commissioner had agreed with the Income-tax Officer. On further appeal, the Appellate Tribunal reproducing section 54 in its order found as follows : "A perusal of the above provision will show that it does not lay down that the construction of any house must be begun after the sale of the old residential house and that the sale proceeds of the old residential house must be used for the construction of the new residential house. We are, therefore, of the op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it will suffice to say that it is misconceived. The Tribunal did not record any finding that the assessee did not invest the capital gains in the construction of the new house. Exemption was refused for the simple reason that the assessee had started the construction of the Surya Nagar house before the sale of the Golf Link house. Therefore, the question that for availing of the benefit under section 54 of the Act it is not necessary that the sale proceeds of the old building must be used in the construction of the new building, was not before the Appellate Tribunal. We, therefore, answer questions Nos. 1 and 2 in the affirmative, that is, in favour of the assessee and against the Revenue, and so far as question No. 3 is concerned, the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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