TMI Blog2020 (2) TMI 773X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act, passed by ld PCIT. We note that ld PCIT further observed from the record that exemption u/s 54EC of the Act was allowed twice for an amount of ₹ 3,90,000/- so, the total amount to be disallowed will be ₹ 25,80,000/- (₹ 21,90,000 + ₹ 3,90,000). We note that this may be a mistake apparent from record, and therefore the same can be rectified under section 154 of the Act. Therefore, we direct the assessing officer to examine the amount of ₹ 3,90,000/- and if it was allowed twice, the same may be disallowed and exemption should be granted under section 54EC of the Act in accordance to law. Appeal of the assessee is allowed. - ITA No. 322/Kol/2018 - - - Dated:- 15-11-2019 - Shri S.S. Godara, JM And Dr. A.L. Saini, AM For the Appellant : Shri Soumitra Choudhury, Advocate, ld.AR For the Respondent : Dr. Shri P. K. Srihari, CIT/ld.DR ORDER PER DR. A. L. SAINI, AM: The captioned appeal filed by the assessee, pertaining to assessment year 2011-12, is directed against the order dated 23-10-2017 passed by the Principal Commissioner of Income Tax, Kol-8, under section 263 of the Income Tax Act, 1961. 2. G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the ITO, Ward-24(2), Hooghly with PAN: AFEPM3406M. The return of income for the A.Y. 2011-12 declaring total income of ₹ 1,58,620/- was filed by the assessee on 30.03.2012. The assessment for the A.Y. 2011-12 was completed u/s 147/143(3) of the I.T. Act, 1961 on 16.03.2016 at a total income of ₹ 8,81,910/-. Later on, the ld. PCIT exercised his jurisdiction u/s. 263 of the Act and on a perusal of the assessment record of the assessee the following error was noticed by him, which is reproduced below :- (i) The assessee during the Financial Year 2010-11 sold two landed property and availed of long term capital gains. Total capital gain was assessed at ₹ 28,60,859/-. The Assessee had been provided exemption u/s 54-EC of the Act at ₹ 21,90,000/- for depositing the capital gain amount in Rural Electrification Corporation Ltd Bond. But on perusal of records, it is found that the said investment was made after the limitation date (i.e. after expiry of 6 months from date of transfer of capital asset), and hence same was to be disallowed. (ii) It was further observed from the record that exemption u/s 54EC of the Act was allowed twice for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at, in addition to the above facts the assessment for which notice u/s 263 issue was pending to Hon'ble CIT (A) 6 / Kolkata. That A.O also asked explanation from the assessee that see 54EC avail was justified . It is not known when the explanation given during the course of hearing was recorded in the order sheet as A.O. did not recorded various submission of the assessee that sending to valuation cell to estimated the case of the property was illegal as assessee did not submit any petition to A.O, u/s 56(2). [ That a letter is annexed as a prove of the statement] Yours honour will be highly appreciated if Tribunal judgement of referred above may kindly be accepted for the principle of natural justice . 5. The assessee, has submitted further written submission, during the proceedings under section 263 of the Act before the ld PCIT, Vide letter dated 08.10.2017, which is reproduced below: That, Income Tax Act, 1961 in availing sec 54EC stated investment to be made within completion of six month not any faction date i.e. 180 days. The Hon'ble judgement of High Court also admitted this facts which was reflected in the application Dt. 14/09/2017 subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and circumstances of the case, the impugned assessment is deemed to be erroneous in so far as it is prejudicial to the interests of the revenue. 7. Aggrieved by the order of the ld. Pr. CIT, the assessee is in appeal before us. 8. The ld. Counsel of the assessee has relied on the order of the AO dated 16.03.2016 and submitted before the Bench that in order to avail the exemption under section 54EC, the assessee may invest within completion of six month and not any fraction date i.e. 180 days. Therefore, the order passed by the AO is neither erroneous nor prejudicial to the interest of Revenue. On the other hand, ld. DR for the Revenue has relied on the impugned order of the ld. Pr. CIT. 9. We heard both the parties and carefully gone through the submission put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the fact of the case including the findings of the ld Pr.CIT and other materials brought on record. First of all, let us examine the terminology of Month in the context of provisions of section 54EC of the Act. Sub-section (1) of section 54EC reads as follows: 54EC-Capital gain not t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y objection is, therefore, overruled. Therefore, about the interpretation of the word month, there is nothing in the context of section 256(2) to warrant the conclusion that the word month in it refers to a period of thirty days. Therefore, reference to six months in section 256(2) is to six calendar months and not one hundred and eighty days. In view of the above judgment in the case of Munnalal Shrikishan Mainpuri (supra), we are of the view that the term Month means calendar month (and not period of thirty days), which should be applied for the purpose of section 54EC of the Act. 10. We note that the law with regard to exercise of jurisdiction u/s.263 of the Act on the ground that the AO failed to make enquiries which he ought to have made in the given circumstances of a case is well settled. The Commissioner can regard the order as erroneous on the ground that in the circumstances of the case the Income-tax Officer should have made further inquiries before accepting the statements made by the assessee in his return. The Income-tax Officer is not only an adjudicator but also an investigator. He cannot remain passive in the face of a return which is apparently in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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