TMI Blog2022 (1) TMI 837X X X X Extracts X X X X X X X X Extracts X X X X ..... ity. In any case, what the law contemplates is a transfer and sale of property which is being used for residential purposes. Therefore, what is essential is that the property should necessarily and solely be a residential house and used for residential purposes only. In the instant case where on an industrial plot of land, there is an office built up area on ground floor and so-called residential built-up area on the first floor, can it be said that what has been transferred is a residential house. To our mind, the answer to the same cannot be in affirmative and what has been transferred is an industrial plot of land having mixed constructed area consisting of office-cum-residential area. We, therefore, agree with the findings of the Ld. CIT(A) that the transacted property is an industrial plot and not a residential plot which is clearly borne out from the contents of the Sale Deed to which the assessee is himself a signatory and duly acknowledges the contents thereof. In the light of the same, subsequent oral evidence in form of an affidavit cannot be accepted and we affirm the findings of the Ld. CIT(A) that merely having Aadhar Card and Bank Account showing the same addres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ified the nature of the property as industrial property. The AO accordingly, informed the assessee that he was not eligible to claim deduction u/s. 54 of the Act as he has sold an industrial plot and not a residential house. The assessee was also informed that he is eligible for deduction u/s. 54F of the Act. Accordingly,, the AO disallowed the deduction u/s. 54 of the Act, of ₹ 3,50,55,939/- as so claimed by the assessee and has allowed deduction u/s. 54F of the Act, amounting to ₹ 1,33,87,863/- and recomputed the Long Term Capital Gains at ₹ 2,16,68,076/-, as against nil offered by the assessee. 3. Being aggrieved, the assessee carried the matter in appeal before the Ld. CIT(A). During the course of hearing before the Ld. CIT(A), it was submitted that the assessee was residing in the said house which has been sold by him and in support, it was submitted that the assessee has obtained his Aadhar Card showing the same address. Similarly, in his bank account, the same address has been mentioned. In his return of income, he is showing the same address where he is residing. Further, an affidavit of the assessee showing that there was no other residential property ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding all type of connection, including all deposited securities, including all those rights which at present are available to us, for a total sale consideration of ₹ 9,25,00,000/- half of which comes to ₹ 4,62,50,000/-. 6.3.3 From the above submissions of the assessee made during the assessment proceedings, it is amply clear that the assessee himself acknowledges and accepts the fact that the impugned property is an industrial plot. The character of properties has been clearly demarcated, in sync with need for proper urban governance, into several categories that include industrial, residential etc. Merely the claims that the assessee has erected a residence in an industrial plot (in clear infraction of the urban laws and estate authorities rules) would not alter the character of the property. For Income Tax purposes sale purchase of properties and their distinctive categories have clearly been enunciated. The provisions guiding capital gains clearly distinguish between agricultural land, such agricultural land that is a capital asset, residential property and the residuary clause any other long term capital asset. In that light the industrial plot sold by the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l of the residential unit befitting exemption under section 54/54F of the Act. The facts of the third case viz. Smt. Harpreet Kaur in ITA No. 293/Chd/2014 reveal that the ITAT, Chandigarh vide its order dated 03/06/2015 had again gone into the validity of proceedings u/s. 263 undertaken by the CIT. 6.3.5 In light of all the above there are no grounds to intervene with the order of the AO to deny claims u/s. 54 of the IT Act, 1961 in light of the fact that, in the entire factual matrix of the case, he has rightfully restricted the benefit to the deduction available u/s. 54F of the IT Act, 1961. Grounds of appeal No. 1 2 are dismissed. 4. Against the said findings and order of the Ld. CIT(A), the assessee is in appeal before us. 5. During the course of hearing, the Ld. AR reiterated the submissions as made before the lower authorities and our reference was drawn to the original sale deed, by virtue of which, the assessee has purchased the said property. It was submitted that the said property was a residential house and no machinery was installed in the property to run as a factory building and the said property was used as a residential house before the sale of the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment proceedings. The said Valuation Report has been prepared by M/s. Syal Associates, Chartered Engineers as on 12.01.2015 about a month prior to the execution of the Conveyance Deed on 10.02.2015 which shows the locality of the property, usage and specification of the constructed area just prior to the execution of the Conveyance Deed. On perusal of the Valuation Report, it is noted that the subject property was located in an industrial area having an area of 4166.70 sq.yd. and a covered area of 52,105 sq.ft. The construction has been carried out in form of parking area, office space, residential and recreational area covering basement, ground floor and first floor. The parking area has been built in the basement floor covering 15000 sq.ft. having RCC framed structure, RCC retaining walls with Tremix flooring. The office area is built on the ground floor covering 18805 sq.ft. consisting of RCC framed structure, Aluminium windows, vitrified tile flooring. The residential area is on first floor with a covered area of 15304 sq.ft. having specification of masonry structure, granite flooring, ceramic tiles in the bathrooms, wooden doors and windows. If we look at the residential ..... X X X X Extracts X X X X X X X X Extracts X X X X
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