TMI Blog2022 (1) TMI 1196X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Act. As in the instant case, the ld. Commissioner allowed the deduction under Section 54 of the Act to the extent only which was invested/utilized by the Assessee till the due date of filing the return under Section 139(1) of the Act and therefore, respectfully following the mandates of the Hon'ble High Courts, we are inclined to allow the deduction under Section 54F of the Act to the extent of amount of capital gain invested/utilized till the filing of the return by the Assessee on 29th March, 2014 under Section 139(4) - Decided in favour of assessee. - ITA. No. 448/Del/2018 - - - Dated:- 19-1-2022 - R.K. Panda, Member (A) And N.K. Choudhry, Member (J) Assessee by : None Department by : Ms. Sangeeta Yadav, Sr.D.R. ORDER Per N.K. Choudhry, JM 1. This appeal has been preferred by the Assessee against the order dated 25.10.2017 impugned herein passed by the ld. Commissioner of Income Tax (Appeals)-12, New Delhi (in short 'Ld. Commissioner'), for assessment year 2013-14. 2. At the time of hearing, nobody appeared on behalf of the Assessee. Even in spite of sending many notices of hearing i.e. 17.03.2021, 11.10.2021 and 20-12-2021, to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6,789/- as claimed by the Assessee and disallowed the same and added in the income of the Assessee. 4. Before the Ld. Commissioner, the Assessee challenged the additions made by the Assessing Officer which includes the addition of ₹ 71,78,207/- on account of long term capital gain. 4.1. Before the ld. Commissioner it was claimed by the Assessee that amount of ₹ 72,15,255/- has been invested towards the purchase of flat at Sunworld Vanalika, up to the date of filing of the Income Tax Return on dated 29th March, 2014 i.e. as belated return filed under Section 139(4) of the Act and, therefore, the Assessee is entitled to get benefit of Section 54 of the Act. The Assessee also submitted various case laws in support of its case. 4.2. The ld. Commissioner partly accepted the claim of the Assessee to the extent of ₹ 57,33,088/- invested up to 31st January, 2013 by observing that the Assessee shall be entitled to deduction under Section 54(1) of the Act for an amount invested till the due date of filing the return under Section 139(1) of the Act. For ready reference, the concluding part of the impugned order is reproduced hereunder:- 4.3.8 I have given du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A the first property. In the case of CIT vs. Smt. Sunita Aggarwal (2006), 284 ITR 20, Hon'ble Delhi High Court held that exemption u/s. 54 can be claimed even if the residential units of a house are purchased from different persons. Hon'ble ITAT, Bangalore held that for claiming exemption u/s. 54, possession or ownership has nothing to do with the case as long as the sum of capital gains stands transferred to the seller for the purchase of a new flat. As, this fulfills the condition of section 54 (Shakuntala Devi vs. DDIT (2009) - TIOL -221 - ITAT - Bang).The Hon'ble Delhi High Court applied the same analogy where the Assessee made substantial payment within the prescribed time and thus acquired substantial domain over the property, although the builder failed to handover the possession within the stipulated period [CIT vs. R.L. Sood (2000), 245 ITR 727 (Del)]. T he Karnataka High Court held that when Assessee invests sale consideration in purchase of a residential property within prescribed time period, he is entitled to claim deduction and, in such a case, extent of construction of residential building and facilities provided in such building are not relevant [CIT Vs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egality. 8. Heard the parties and perused the material available on record. The question involved in the instant case relates to the situation 'as to whether the deduction under Section 54 of the Act can be claimed to the extent of amount of capital gain invested for new asset purchased or construction of new asset within the time prescribed under Section 54F(4) of the Act, till the filing of the Income Tax Return under Section 139(4) of the Act'. 8.1. Hon'ble Punjab Haryana High Court in the case of CIT Vs. Jagriti Aggarwal (2011) 339 ITR 610 (P H) dealt with an identical issue and while relying upon Hon'ble Gauhati High Court judgment in the case of CIT Vs. Rajesh Kumar Jalan (2006) 286 ITR 274 held and justified the utilization of the capital gain for purchase of property before the extended due date under Section 139(4) of the Act. 8.2. Hon'ble Punjab Haryana High Court again in the case of CIT Vs. Jagtar Singh Chawla{ITA No. 71 of 2012 (O M) date of Decision: 20.3.2013} while relying upon the judgments passed by the same high court in CIT Vs. Jagtar Singh Chawla and Hon'ble Gauhati High Court in the case of CIT Vs. Rajesh Kumar Jalan (2006) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eme should have been made before the initial due date and not the extended due date is an untenable contention. A Division Bench of this Court in which one of us (Hemant Gupta, J.) was a member, had an occasion to consider the provisions of Section 54(2) of the Act, wherein it has been held that sub-section (4) of Section 139 of the Act is in fact a proviso to Section 139(1) of the Act. Therefore, since the Assessee has invested the sale proceeds in a residential house within the extended period of limitation, the capital gain is not payable. The judgments in Rajesh Kumar Jalan's case and Fathima Bai's case (supra) were referred to. It has been held as under:- Having heard learned counsel for the parties, we are of the opinion that sub-section (4) of Section 139 of the Act is, in act, a proviso to sub-section (1) of Section 139 of the Act. Section 139 of the Act fixes the different dates for filing the returns for different assesses. In the case of assessee as the respondent, it is 31st day of July, of the Assessment Year in terms of clause (c) of the Explanation 2 to sub-section 1 of Section 139 of the Act, whereas sub-section (4) of Section 139 provides for ex ..... X X X X Extracts X X X X X X X X Extracts X X X X
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