TMI Blog2019 (12) TMI 1254X X X X Extracts X X X X X X X X Extracts X X X X ..... accepted the claim made by the assessee in the assessment framed under section 147 read with section 143(3) of the Act. The courts have held that once the claim in the case of the co-owner has been accepted then such claim/benefit cannot be denied in the case of other coowner. We hold that the impugned transaction cannot be treated as colourable device adopted by the assessee to escape from the income tax liability. Accordingly we are of the opinion that the principles laid down in the case of McDowells [ 1985 (4) TMI 64 - SUPREME COURT] cannot be applied in the case on hand. In view of the above, the ground of appeal of the assessee is allowed. Addition on account of cash deposited in the bank - HELD THAT:- Cash withdrawal from the bank has not been doubted by the authorities below. Similarly nothing has been brought on records suggesting that the cash withdrawn from the bank has been utilized for some other purposes other than the deposit of cash as alleged by the authorities below. The onus was of the Revenue to reject the contention of the assessee based on cogent reasons that the cash was not deposited out of the cash withdrawal from the bank. But the Revenue fail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t for the investment made in the residential bungalow amounting to ₹ 13,46,203.00 only. 3. The facts in brief are that the assessee in the present case is an individual and non-resident Indian. His (the assessee) brother Shri Vijay Bhai Hathi Singh Shah is the power of attorney holder on behalf of the assessee. The brother of the assessee Shri Vijay Bhai Hathi Singh Shah is a partner in a partnership firm namely M/s Bhikubhai Infrastructure LLP ( in short BI LLP ) which is engaged in the development of the properties. 3.1 The assessee through his brother Shri Vijay Bhai Hathi Singh Shah along with other co-owners in the year under consideration has sold the piece of land to the BI LLP for ₹. 1,12,00,000.00 but the value for the purpose of the stamp duty was determined at ₹ 1,38,32,653.00. Accordingly the share of the assessee in the sale consideration was calculated at ₹ 23,05442.00 being 1/6 share in the ownership of the land. As such the assessee has offered the capital gain of ₹ 3,13,472 to tax as capital gain in the manner given below: Income from long term capital gain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion under section 54F of the Act as a colourable device by using dubious methods for tax evasion. Accordingly, the AO was of the view that such planning involving the tax evasion cannot be permitted in view of the judgment of the Hon ble Supreme Court in the case of Mcdowell Co. Ltd. Vs Commercial Tax Officer reported in 154 ITR 148. Accordingly the learned AO denied the benefit of the exemption provided under section 54F of the Act and added to the total income of the assessee. Aggrieved assessee preferred an appeal to the learned CIT (A). 4. The assessee before the learned CIT (A) submitted that he has not filed the income tax return under the provisions of section 139 of the Act as he was under the belief that his income is not chargeable to tax. 4.1 The purpose of the provisions of section 54F of the Act was to make the investment in the residential property which has been done in the case on hand. But the sale deed was executed as the new residential property was under the construction. The assessee also claimed that the provisions of section 54F of the Act are the beneficial provision therefore the same should be read liber ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the impugned property has finally been registered in the name of the assessee dated 30 March 2019. The learned AR in support of his claim filed the copy of the sale deed which is placed on record. The learned AR reiterated the submissions as made before the authorities below. 7. On the other hand, the learned DR supported the view taken by the authorities below by reiterating the findings contained in the respective orders. 8. We have heard the rival contentions of both the parties and perused the materials available on record. From the preceding discussion we find that the benefit of exemption claimed by the assessee under section 54F of the Act was denied by the lower authorities mainly on 2 grounds. Firstly, the construction was not completed within the time permitted under the provisions of section 54F of the Act. Secondly, the entire transaction for sale of the land and the alleged investment in the property for claiming the exemption under section 54F of the Act is a colourable device which is impermissible under the provisions of law. 8.1 Admittedly, the property was finally acquired by the assessee as evident from the copy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance from the judgment of Hon ble Karnataka High Court in the case of PCIT versus C. Gopalaswamy reported in 81 taxmann.com 78 wherein it was held as under: The assessee invested long-term capital gain on shares in residential house and claimed benefit under section 54F. The Assessing Officer disallowed the claim of exemption under section 54F on the ground that the construction of villas was not completed within the stipulated time allowed under section 54F. The Tribunal held that it was true that the agreement for construction entered by the assessee with the builder gave an outer date, which went beyond the three year period from the date of sale of the shares. However, the assessee had done what all it could do for acquiring the villa by paying the whole of the price. The Tribunal, accordingly, allowed claim of exemption. Held that the issue is already covered by the decision of this Court in the case of CIT v. Sambandam Udaykumar [2012] 345 ITR 389/19taxmann.com 17/206 Taxman 150. Since the Tribunal has followed the said decision of this Court, no substantial question of law would arise for consideration in the present a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act adopted full value of the sale consideration equivalent to the amount on which stamp duty was paid. The case of the assessee was that in the case of co-owner, reference was given to DVO under section 50C(2) who had determined fair market value of the property. The ld.counsel for the assessee contended that the assessee made a prayer before the ld.CIT(A) that the same value be adopted in the case of the assessee. We find force in this contention of the assessee, because section (2) of section 50C contemplates that in case assessee raises an objection of the value on which stamp duty was paid, then in order to find fair market value of the asset, reference would be made to the DVO , since in the case of co-owner such reference was made on the same piece of land. The same value ITA No.2444/Ahd/2016 determined by the AO in the case of co-owner ought to be adopted in the case of the assessee. We allow the appeal of the assessee and remit the issue to the file of the AO with direction to the ld.AO to compute the capital gain assessable in the hands of the assessee on transfer of the above land by adopting full sale consideration equivalent to the amount determined by the DVO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he order of the AO. Being aggrieved by the order of the learned CIT (A) the assessee is in appeal before us. 13. The learned AR before us reiterated the submissions as made before the authorities below. 14. On the other hand the learner DR vehemently supported the order of the lower authorities. 15. We have heard the rival contentions and perused the materials available on record. From the preceding discussion, we find that the cash withdrawal from the bank has not been doubted by the authorities below. Similarly nothing has been brought on records suggesting that the cash withdrawn from the bank has been utilized for some other purposes other than the deposit of cash as alleged by the authorities below. The onus was of the Revenue to reject the contention of the assessee based on cogent reasons that the cash was not deposited out of the cash withdrawal from the bank. But the Revenue failed to do so. Thus in the absence of any documentary evidence, we can safely presume that the cash withdrawn from the bank was available with the assessee which was subsequently deposited with the bank. Therefore, w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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