TMI Blog2022 (4) TMI 1127X X X X Extracts X X X X X X X X Extracts X X X X ..... date of filing of the return of income under Section 139(1) of the Act. Considering the CBDT s Circular No. 471 dated 15.10.1986, Circular No. 672 dated 06.12.1993 the said to be treated as construction for the purpose of Section 54/54F. Further that considering the Circular No. 672 issued by the CBDT the said amount paid out of the net sale consideration in the original asset is required to be treated as purchase / construct. Further that though the above clarification is for Section 54F, the analogy in our considered opinion has been rightly applied by the CIT(A) in the case in hand considering the facts and circumstances therein. Hence, advance payment by the appellant to purchase agricultural land from the sale proceed of the land sold by him has been rightly found eligible for benefit under Section 54B of the Act by the Ld. CIT(A) without any ambiguity so as to warrant interference. Once the main issue is decided in favour of the assessee consideration of the third limb relating to deposit of capital gain amount has become nugatory. The Revenue s appeal is, therefore, dismissed. - I.T.A. No.358/Rjt/2015 And I.T.A. No.497/Rjt/2015 - - - Dated:- 22-4-2022 - Shri Waseem Ah ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment in the case of the assessee. 5. During the previous year 2009-10 the assessee sold a plot an agricultural urban land lying and situated at Survey No. 140P at village Ghanteshwar, admeasuring about 13 acres for a consideration of ₹ 3,00,00,000/-. Within a period of two years therefrom the assessee further purchased an agricultural land at Vejagam, District Rajkot for a consideration of ₹ 20,90,00,000/-. Out of which an amount of ₹ 12.15 crores were paid before the filing of return on 15.10.2010. While filing of return the assessee declared total income of ₹ 73,25,860/- including the claim of exemption of ₹ 2,90,08,646/- under Section 54B of the Act in respect to long term capital gain derived on sale of the aforesaid agricultural land. The Ld. AO finalized the proceeding rejecting such claim made by the assessee under Section 54B which was, in turn, allowed by the Ld. CIT(A). Hence, the instant appeal before us. 6. We have heard the relevant submissions made by the respective parties, we have also carefully considered the materials available on record before us. 7. Upon perusal of the order passed by the Ld. AO it appears that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Mamlatdar, which is mentioned in the assessment order. However, it is also a fact that, during the course of assessment proceedings, the appellant had sought cross examination which was granted to the appellant. During the course of cross examination, various flaws were noticed. Incidentally, the opportunity of cross examination and the findings therein and the objections raised by the appellant, has not- been dealt with by the AO. To cite an instance, the Talati had given a statement that the impugned land was a barren land. He did not know that the change of character of land was made by virtue of Collector's order way back in 2004 and the land has been classified as agricultural land' and not vidi as alleged. Secondly, it also transpires from the cross examination that, he has given the statement based on his personal visit during the course of assessment proceedings only i.e. after the lapse of more than 3 years from the end of the accounting year when the land was sold out. The AO ought to have dealt with these facts in the assessment order, which has not been done so. Therefore, in light of the above, it is held that the evidence on record outweighs far more t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperties are booked first and then purchased, the above Circular No 672 of the CBDT clarifies that, if any amount out of net sale consideration of the original asset is paid, this should be considered under the terms 'purchase / construct'. It is not disputed that the appellant had not made payment towards advance for purchase of the property for the purpose of section 54B. Although the above clarification is for section 54F, but the analogy of the same can be used here in the instant case. Besides, the decisions relied upon by the ld. AR has also substantial force and the facts therein are similar to the facts and circumstances of the present case. Hence, the advance payment made by the appellant to purchase agricultural land from the sale proceeds of the land sold by him, is eligible for benefit u/s. 54B. Therefore, the AO is factually wrong in not allowing this benefit to the appellant. 11. We have considered both the contention made by the assessee and the Revenue and the observation made by the Ld. CIT(A). Regarding the first contention after considering the statement of the Talati and the cross-examination made by the assessee it was found that the land was not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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