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TMI Blog2019 (12) TMI 1100X X X X Extracts X X X X X X X X Extracts X X X X ..... hus confirmed the addition of Rs. 64,07,515/- in place of an amount of Rs. 30,17,456/- as made to the income of the appellant in respect of long term capital gain derived on the sale of the property. The enhancement has been made without issuing any specific notice of enhancement by the Commissioner of Income Tax (Appeal-IV), Kanpur though earlier proposed by his predecessor and the same is unjustified, unwarranted, illegal, bad in law and in any case without merits. 2. That on the facts of the case and in law, the Commissioner of Income Tax (Appeal-IV), Kanpur misdirected him to calculate the long term capital gain on the sale of the property by adopting deemed sale value under section 50C of the Act at a figure of Rs. 64,07,515/- and f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respect of the investment made in the purchase of the residential house in view of the provisions contained in Section 54F(1)(a) of the Act 5. That the appellant craves, leave to modify/amend or add any one or more grounds." 3. The return declaring an income of Rs. 7,01,200/- was filed on 12.08.2009. The case was selected for scrutiny and notice u/s 143(2) dated 25.08.2010 was issued and served on the assessee. Subsequently, notice u/s 142(1) dated 09.09.2011 along with questionnaire was issued. On 18.11.2011, CA of the assessee attended the assessment proceedings and filed written submissions and was asked to submit the details of property sold. As per AIR information two properties, one property for Rs. 1,58,00,000/- and other prope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b) of the Act. The Assessing Officer while not disputing the claim of the assessee for exemption u/s 54F(1)(b) of the Act in respect of investment of long term capital gain has calculated and worked out the addition of Rs. 30,17,456/- to the income as per working considering the full value of consideration as per Section 50C while determining exemption. The assessee filed appeal before the CIT(A), Ghaziabad. The Ld. AR further submitted that pending the disposal of the appeal filed before the CIT(A), Ghaziabad, a search was conducted on 19.02.2013 by the department at the business premises of the company and also at the residences of the directors. As a result of which the cases were centralized with the ACIT, and likewise, the appeal which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the cost of new asset is less than the net consideration in respect of the asset transferred, so much of the capital gain as bears to the whole of the capital gain, the same proportion as the cost of the new asset bears to the net consideration, shall not be charged u/s 54F. Nowhere does it mention consideration as per section 50C. The fiction u/s 50C is extended only to the aspect of computation of capital gains and the same does not extend to the charging section or the exemptions to the charging section. The legislature consciously intended to apply the fiction under Section 50C only to the expression used in section 48 and not in any other place. Section 50C has no effect for calculating exemption u/s 54F. The long term capital gain exe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 67 ITD 237 (Jaipur - Trib.) iv. DCIT vs. Dr. Chalasani Mallikarjuna Rao (2016) 161 ITD 721 (Visakhapatnam Trib.) v. Nand Lal Sharma vs. ITO [2015] 40 ITR(T) 518 (Jaipur - Trib.) vi. Dhanveer Singh Gambhir vs. ITO, 3(2), Indore [2015] 56 taxmann.com 205 (Indore - Trib.) vii. Prakash Karnawat vs. ITO (2011) 16 taxmann.com 357 (Jaipur) viii. Gyan Chand Batra vs. ITO [2010] 6 ITR(T) 147 (Jaipur) ix. Raj Babbar vs. ITO (2013) 29 taxmann.com 11 (Mumbai Trib.) x. Commissioner of Income Tax vs. George Henderson and Co. Ltd. [1967] 66 ITR 622 (SC) xi. CIT vs. Smt. Nilofer I. Singh (2008) 309 ITR 233 (Delhi HC) xii. ITO vs. Manjit Singh [2010] 128 TTJ 82 (Chandigarh) (UO) xiii. CIT, Panji vs. V. S. Dempo Company Ltd. [20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the claim of the assessee for exemption u/s 54F(1)(b) in respect of investment on long term capital gain but instead of taking actual sale consideration received, has adopted the figure of sale consideration by invoking Section 50C. This is not in accordance with the provision of Section 50C which has created a deeming fiction. Section 54F is an exemption provision and it has given its applicability in itself, therefore, Section 50C will not come under picture. The Long Term Capital Gain exemption is admissible u/s 54F(1)(b) of the Income Tax Act, 1961 wherein total taxable gain comes to Rs. 2,68,830/- only as the investment made by the assessee adopting the figure of the actual sale consideration received in consequence with Section 54F ..... X X X X Extracts X X X X X X X X Extracts X X X X
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