TMI Blog2019 (7) TMI 802X X X X Extracts X X X X X X X X Extracts X X X X ..... o deduction from Capital Gains tax liability by the authorities below. Accepting the interpretation of word a as occurring in Section 54 as made by Hon ble Madras High Court in Tilokchand Sons V/s ITO [supra] , we hold that on the facts and circumstances, the assessee would be eligible to claim deduction u/s 54 on all the four residential houses. Condonation of delay of 326 days - concern CA of a CA firm who was handling assessee s matter, left the organization without handing over the papers - HELD THAT:- Keeping in view the principle of natural justice and ratio of decision of Hon ble Apex Court in Collector, Land Acquisition Vs. Katiji, [ 1987 (2) TMI 61 - SUPREME COURT] the bench formed an opinion that the delay deserve to be condoned - I.T.A. No.7062/Mum/2017 - - - Dated:- 15-7-2019 - Shri Sandeep Gosain, JM And Shri Manoj Kumar Aggarwal, AM For the Assessee : Shri M. Subramanian, Advocate-Ld.AR For the Revenue : Chaudhury Arun Kumar Singh-Ld.DR ORDER MANOJ KUMAR AGGARWAL (ACCOUNTANT MEMBER):- 1.1 Aforesaid appeal by assessee for Assessment Year [in short re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ief under the said section is available if the investment is made in one residential house situated in India. The Finance Act, 2019 has further amended the said provision with effect from 01/04/2020 to provide that in case of capital gain not exceeding ₹ 2 Crores, deduction shall be available even against investment in two residential houses in India. 2.2 Interpreting the provisions of Section 54, Hon ble Madras High Court in recent decision titled as Tilokchand Sons V/s ITO [105 Taxmann.Com 151 14/03/2019], applying the decisions of Hon ble Karnataka High Court in CIT V/s D. Ananda Basappa [309 ITR 329] CIT V/s Khoobchand M. Makhija [43 Taxmann.com 143 18/12/2013] held that if the word 'a' as employed under Section 54 prior to its amendment and substitution by the words 'one' with effect from 01/04/2015 could not include plural units of residential houses then there was no need to amend the said provisions by Finance Act No.2 of 2014 which the Legislature specifically made it clear to operate only prospectively from AY 2015-16. Once it is held that the word 'a' employed can include plural resi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ext and to the legislative history. Words and expressions at times have a 'technical' or a 'legal meaning' and in that case they are understood in that sense. Judicial decisions expounding the meaning of words in construing statutes in pari materia will have more weight than the meaning furnished by dictionaries. (Principles of Statutory Interpretation by Justice G.P.Singh pages 279 and 280). It is in this background, it is necessary to understand the meaning of the word 'a' in the context in which it is used in the said Section. 10. The words a or an and the are called Articles. They come before nouns. There are two Articles a (or an) and the a or an is called the Indefinite Article, because it usually leaves indefinite the person or thing spoken of. The is called the Definite Article, because it normally points out some particular person or thing. The indefinite article is used before singular countable nouns. The definite article is used before singular countable nouns, plural countable nouns and uncountable nouns. The indefinite Article is used in two contexts, firstly, in its original numerical ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he capital gain being charged to income-tax as income of the previous year in which the transfer took place, it shall be dealt with in accordance with the following provisions of this section, that is to say, - .. . 9. A reading of the aforesaid provision makes it very clear that the property sold is referred to as original asset in the section. That original asset is described as buildings or lands appurtenant thereto and being a residential house. Therefore, it is not mere a residential house . The residential house may include buildings or lands appurtenant there to. The stress is on the use to which the property is put to. Only when that asset was used as a residential house, which may consist of buildings or lands appurtenant thereto, the income derived from the sale of such a residential house is chargeable under the head Income from house property. If 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 a residential house, then, instead of the capital gain being charged to income-tax as income of the previous year in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 09 ITR 329] took similar view and dismissed revenue s appeal by holding that no substantial question of law arose. The decision of Hon ble Punjab Haryana High Court in Pawan Arya V/s CIT [11 Taxmann.com 312] was distinguished in this case also by noticing that in that case the assessee was claiming exemption by purchasing two independent residential houses situated at different locations i.e. one in Delhi and other in Faridabad. 3.1 Keeping in mind the aforesaid legal position, the assessee before us is a resident individual who earned Long-Term Capital Gain of ₹ 297.16 Lacs on sale of certain inherited residential property. The assessee s share in the property was to the extent of 18.78%. The assessee claimed deduction u/s 54 on account of investment made in following 4 properties by asserting that the conditions to claim the deduction were duly fulfilled by her: - No. Particulars Amount (Rs.) 1. Flat No.A103, Oshiwara Jogeshwari Scheme Deposit 1,78,71,080 11, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the word a was intended for investment in one residential house property only. The said decision, in the opinion of Ld. CIT(A), was approved by Hon ble Bombay High Court in CIT V/s Raman Kumar Suri [212 Taxman 411] . Further reliance was placed on the decision of Hon ble Bombay High Court in CIT V/s Devdas Naik [49 Taxmann.com 30] and the decision of Mumbai Tribunal in Neville J.Pereira V/s ITO [8 Taxmann.com 68] to confirm the stand of Ld. AO. 5. Aggrieved, the assessee is in further appeal before us. Although the assessee has raised as many as 7 Grounds of appeal, however, Ld. Authorized Representative for Assessee, Shri M. Subramanian, submitted that the assessee is pressing only for adjudication of Ground Nos. 4 5, which read as under: - 4. On the facts and in the circumstances of the case and in law, the learned C.I.T(A) erred in confirming the action of the A.O. in determining the capital gains income at Rs. l,07,95,556/-as against the returned capital gains income of ₹ 1,02,316/-. 5. On the facts and in the circumstances of the case and in law, the learned C.I.T(A)erred in dismissing the appeal and there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstructed in such a way that adjacent units or flats could be combined into one. In that decision, the Hon ble Court, in similar manner, dismissed revenue s appeal finding that no substantial question of law arose. 6.4 Proceeding further, we find that the recent decision of Hon ble Madras High Court in Tilokchand Sons V/s ITO [supra] squarely applies to the fact of the case. While arriving the decision, the Hon ble court has followed the decision of Hon ble Karnataka High Court in CIT V/s D. Ananda Basappa [supra] CIT V/s Khoobchand M. Makhija [supra]. Similar is the interpretation of word a by Hon ble Karnataka High Court in CIT V/s Smt. K.G.Rukminiamma [supra] and the decision of Hon ble Madras High Court in its earlier decision titled as CIT V/s Gunamal Jain [supra] after applying the decision of same court in CIT V/s V.R. Karpagam [supra]. The Hon ble Delhi High Court relying upon the decision of Hon ble Karnataka High Court in CIT V/s D. Ananda Basappa [309 ITR 329] took similar view. In fact, similar is the view of Hon ble Andhra Pardesh High Court in CIT V/s Syed Ali Adil [33 Taxmann.com 212]. No direct decision of Hon b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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