TMI Blog2021 (3) TMI 412X X X X Extracts X X X X X X X X Extracts X X X X ..... mutually contradictory lines. Reinvestment of assessee s capital gains by utilising her joint family s funds - Assessee s detailed paper book filed on 09-02- 2021 placing on record all the relevant details of her house constructed in plot Nos.30 and 31, Magadha Village, Kokapet, Rajendra Nagar Mandal, R.R.District purchased on 21-09- 2005 followed by sanction of construction dt.16-06-2007 and completed on 18-05-2012. We hold in this factual backdrop that larger interest of justice would be met in case the Assessing Officer examines the entire issue of re-investment of assessee s capital gains in the above stated property afresh. Assessee s appeal is treated as allowed for statistical purposes. - I.T.A. No.4/HYD/2019 - - - Dated:- 8-3-2021 - Shri A.Mohan Alankamony, Accountant Member And Shri S.S.Godara, Judicial Member For the Assessee : Shri B.Satyanarayana Murthy, AR For the Revenue : Shri Sunil Kumar Pandey, DR ORDER PER S.S.GODARA, J.M. : This assessee s appeal for AY.2012-13 arises from the CIT(A)-6, Hyderabad s order dated 29-10-2018 passed in case No.10214/2017-18/A3/CIT(A)-6, in proceedings u/s.143(3) r.w.s.147 of the Income Tax Act, 1961 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... radeep. As such, it is clearly evident that the assessee made investment towards new asset from her own funds or sources only to the extent of ₹ 6,43,300/-. 7.4 At this juncture, it is also important to note that the assessee has not furnished the details of new asset constructed such as description of the property, total extent of land and built up area, date of plan approval along with copy of approved plan, total amount of investment made, date of completion of the property, occupancy certificate/completion certificate issued by the Municipal authorities concerned, if any, etc. Accordingly, there is no clarity with regard to genuineness of investment made in the new asset and date of completion of construction of such new asset. Under the circumstances, prima facie, I am of the considered opinion that the assessee is not at all eligible to claim exemption uls.54F of the Act as she has failed to fulfil the basic requirements stipulated thereof. 7.5 Be that as it may, for argument sake, if it considered that the assessee is entitled to claim exemption u/s.54F of the Act, then the moot question to be answered is- Whether there should he direct nexus between the sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laimed that the loan has been sanctioned in the joint name of the wife of the assessee and the assessee. In our opinion, in the circumstances, it cannot be said that the assessee has made investment for purchase of the property due to the reason that loan has been primarily sanctioned to the wife of the assessee, who is having title over the-property and the assessee has been joined in the loan for the purpose of repayment of the loan. The repayment of loan by the assessee.is a transaction different from the transaction of investment in the property. Moreover, the assessee has not submitted any evidence of repayment of loan by him. Thus, we conclude that investment in the new property worth ₹ 1,30,31,250/- has not been made by the assessee. In view of the above facts and circumstances, we are of the opinion that finding of the Ld.CIT-(A) with regard to the investment of ₹ 1,30,31,250/- in new property-is well reasoned and we do not find any error in the said finding and accordingly uphold disallowance of deduction under section 54F of the Act in respect of the said investment of ₹ 1,30,31,250/- (emphasis supplied) 2. T.Ramesh Vs.ITO (TS-7189-1TAT-2017(Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner (Appeals) and the same was to be confirmed Accordingly, the appeal of the assessee was to be dismissed (emphasis supplied) 7.7 As seen from the above, it is clearly held by the Hon'ble ITAT that exemption u/s.54F of the Act cannot be allowed in respect of investment made in the new asset out of borrowed funds. On other hand, in the written submissions, it is stated by the AR of the assessee that exemption u1s.54F of the Act in respect of purchase of residential house out of borrowed money from bank has been allowed by the Hon'ble ITAT, Mumbai in the above mentioned case i.e., Milan Sharad Ruparel (Supra). The relevant portion of the assessee's submissions is reproduced below in this regard. Where the assessee having used the sale proceeds for some other purpose, has borrowed money from bank-for purchase of residential house within the-specified period, exemption under section 54F cannot be denied (Milan Shard Rup Act V ACIT (2010) 5 itr (Trib) 570 (Mum)) As such, the assessee! AR of the assessee bas misquoted the case law which is in favour of the department and, thereby, tried to mislead the appellate authority which is uncalled for in a q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 90,560/-, out of which, only a sum of ₹ 6,43,300/- was invested from her own source of income/funds. Therefore, if at all, the assessee is eligible to claim exemption u/s.54F of the Act, the same should be restricted to ₹ 6,43,300/-. Also, it may be noted that as decided vide para no.6.9 above, the assessee s claim u/s.54F of the Act made before the AO is only ₹ 63,90,560/- instead of ₹ 1,00,00,000/- claimed in the grounds of appeal. However, in view of the findings given in para nos.7.4 7.10 above, I am of the considered view that the assessee is not at all eligible for deduction u/s.54F of the Act. Thus, the grounds of appeal filed by the assessee are dismissed . 3. We have given our thoughtful consideration to rival pleadings against and in support of the impugned disallowance. Learned departmental representative vehemently contended during the course of hearing that both the lower authorities have rightly held the assessee as not entitled for the impugned deduction since neither any capital gains had arisen from transfer of her capital asset nor had she reinvested the same in a residential house so as to be eligible u/s.54F of the Act. He ..... X X X X Extracts X X X X X X X X Extracts X X X X
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