TMI Blog1984 (12) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... fetime, sold his residential house situated at Nallakunta in Hyderabad in December, 1975, for a sum of Rs. 2 lakhs. Immediately thereafter, he entered into an agreement for purchase of another house at Purani Haveli and paid an advance amount of Rs. 1,000. He died on April 16, 1976, soon after the payment of the earnest money. The transaction was subsequently completed by the legal representatives of the deceased and the house was purchased on December 23, 1976, i.e., within one year from the date of sale of the original house. There is no dispute that the house sold was used for residential purpose and the house purchased was also for residential purpose. The question is whether the legal representatives were entitled to claim exemption un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a period of one year before or 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, then, instead of the capital gain being charged to income-tax as income of the previous year in which the transfer took place, it shall be dealt with in accordance with the following provisions of this section, that is to say, (i) if the amount of the capital gain is greater than the cost of the residential house so purchased or constructed (hereafter in this section referred to as the new asset), the difference between the amount of the capital gain and the cost of the new asset shall be charged under section 45 as the income of the previous year; and for the purp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... word " assessee " must be given a wide and liberal interpretation so as to include his legal heirs also. There is no warrant for giving too strict an interpretation to the word "assessee" as that would frustrate the object of granting the exemption and what is more, in the instant case, the very same assessee immediately after the sale of the house, entered into an agreement for purchasing another house and paid a sum of Rs. 1,000 as earnest money and subsequently the legal representative completed the transaction within a period of one year from the date of the death of the deceased. The sale and purchase are two links in the same chain. We are fortified in this view by a decision of the Madras High Court in C. V. Ramanathan v. CIT [1980] ..... X X X X Extracts X X X X X X X X Extracts X X X X
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