TMI Blog2013 (1) TMI 1011X X X X Extracts X X X X X X X X Extracts X X X X ..... of property in SCO No. 6 7, Sector 17-B, Chandigarh for a sale consideration of ₹ 5,40,54,000/- vide sale deed dated 13.08.2008. This property was originally purchased in the name of Vinod Kumar Sharma, husband of the assessee in 1968-69 by Shri Vivek Chander Sharma HUF and the same was assessed in the hands of HUF. In the year 1984, there was a partition in the HUF and Smt. Sunita Sharma i.e. the assessee received 60% share in this property. Against the capital gain on the said property, the assessee had claimed deduction u/s 54F of the Act by claiming to have purchased Plot No. 614 in Sector 36-B, Chandigarh for a sum of ₹ 2,84,79,201/-. It was noticed that this plot was registered in the joint name of the assessee and her husband Shri Vinod Kumar Sharma. The assessee was issued a show cause notice to explain why deduction u/s 54F of the Act should not be restricted to 50% of the purchase consideration. In response, it was submitted that the assessee s husband was only a pensioner and did not have any money to pay for the purchase of house. His name was included in the registry for the purpose of conveyancing and to avoid future litigation on the death of the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gain arises from, the transfer of any long-term capital asset, not being a residential house (hereafter in this section referred to as the original asset), and 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 (hereafter in this section referred to as the new asset), the capital gain shall be dealt with in accordance with the following provisions of this section, that is to say, -.......,................ Thus, the emphasis in section 54F of the Act is on purchase of new asset by investing the amount of the consideration. In the instant case, the property had been assessed for the last more than 25 years under the Wealth Tax Act in the hands of the appellant. Hence, it is irrelevant that the consideration received on sale of the property had been deposited in the account of the husband. It is also irrelevant that the amount had been paid for acquisition of new asset from the same account of the husband because the consideration received has been invested and in any case, it was to be invested out of that account only, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e sale proceeds were invested in the construction of a residential house. It was further held that it was not necessary that the newly constructed house should be in the name of the assessee and in the eye of law an adopted son had the same rights as a natural son and allowed the appeal and directed the Assessing Officer to compute relief in accordance with section 54F of the Act. The Tribunal on appeal by the Department quashed this order and restored the order of the Assessing Officer. On appeal by the legal heir of the assessee : 9. On the above facts, it was held as under:- Held, (i) that though the deceased assessee sold the property owned by him he purchased the new property in the name of the adopted son and paid consideration out of the sale proceeds in question with clear intention to transfer the property to the adopted son. He, therefore, utilized the sale proceeds to construct a house by transferring the property and submitting the plan in the name of the son. He transferred the property before the prescribed period as per the scheme of the section, and the son became the owner of the property for all purposes. The deceased assessee admittedly had no domain or ri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dismissing the appeal, that the condition stipulated in section 54F stood fulfilled. It would be treated as the property purchased by the assessee in his name and merely because he had included the name of his wife and the property purchased in the joint names would not make any difference. The assessee was entitled to exemption under section 54F 12. In the case before us also, admittedly the whole consideration had been paid by the assessee. The only defect found by the Assessing Officer that first the sale consideration of old property was deposited in the account of the husband and that will not alter the situation because assessee did not have any separate account. She used the account of her husband. There was no allegation that the assessee s husband has also invested some money for acquisition of new property. Therefore, in our opinion, the assessee is entitled to 100% deduction u/s 54F of the Act. Accordingly, we confirm the order of Ld. CIT(A). 13. Ground No.3 During assessment proceedings, the Assessing Officer noticed that cost of acquisition of property which was sold by the assessee was determined by substituting the indexed cost and the market value of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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