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TMI Blog2022 (7) TMI 734X X X X Extracts X X X X X X X X Extracts X X X X ..... unds of appeal: "1. That in the facts and in the circumstances of the case and in law, the Ld. CIT(A)- 10 was not justified in not deleting a sum of Rs. 9933057/- being the amount wrongly included by the appellant under the head capital gain, while filing return of income whereas as per section 54F no amount is liable to be taxed. 2. The appellant craves leave to add/alter or modify any grounds of appeal at hearing stage." 2. Brief facts of the case are that the return of income was e-filed by assessee on 25.08.2015 declaring total income of Rs. 1,01,41,590/-. The case of the assessee was selected for scrutiny through CASS. Accordingly, notice u/s 143(2) & 142(1) of the I.T. Act, 1961 were issued to assessee, in response to the same, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on officer under section 55A without granting any opportunity to the appellant of being heard which is against the principles of natural justice and thus the assessment so framed in liable to be quashed. iv. That the appellant craves leave to add or alter or modify any other ground or appeal at the hearing stage." 6. However, the ld. CIT(A) partly allowed the appeal with the following observation: "1. I have carefully considered the submissions of the appellant in the backdrop of the observations recorded by the Ld. AO in the impugned order. It is noted that the assessee had sold an immovable property for a consideration of Rs.1,00,00,000/- whereas the deemed value u/s 50C was Rs. 10,46,60,259/-. Thè cost of acquisition of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AR submitted that the ld. CIT(A) did not decide core issue in connection with the appeal as appellant invested an aggregate sum of Rs. 1,16,57,772/- against net consideration of Rs. 1,00,00,000/- and thus no gain is taxable under the head of capital gain, since the assessee's entire net consideration was invested in u/s 54F and accordingly no income is chargeable under the head of capital gain though the appellant has included a sum of Rs. 99,33,057/- (LTCG Rs. 2,15,90,819/- - Rs. 1,16,57,762/-) due to wrong impression of law and it should be excluded. On the other hand, ld. DR vehemently opposed the submission made by the ld. AR and he supported the decision made by the ld. CIT(A). 8. We after hearing the rival submission of parties and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue, the AO has rightly allowed the benefit of deduction u/s 54F to the assessee to the extent of actual investment of Rs 24,60,000 in the new house property. Per contra, the contention of the assessee is that where the whole of the actual sale consideration of Rs 24,60, 000 has been invested in the new house property, the whole of the capital gains, even though worked out in terms of section 50C of the Act, would be eligible for deduction under section 54F of the Act and the assessee is not liable to pay any capital gains tax. 10. To appreciate the issue under consideration, we refer to the provisions of section 54F which reads as under: "54F. (1) Subject to the provisions of sub-section (4), where, in the case of an assessee be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... towards the purchase of the new asset made within one year before the date on which the transfer of the original asset took place, or which is not utilized by him for the purchase or Construction of the new asset before the date of furnishing the return of income under section 139, shall be deposited by him before furnishing such return such deposit being made in any case not later than the due date applicable in the case of the assessee for furnishing the return of income under sub-section (1) of section 139 in an account in any such bank or institution as may be specified in, and utilized in accordance with, any scheme which the Central Government may, by notification in the Official Gazette, frame in this behalf and such return shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue. The consideration as determined under section 50C based on the stamp duty authority valuation is not a consideration which has been received by or has accrued to the assessee. Rather, it is a value which has been deemed as full value of consideration for the limited purposes of determining the income chargeable as capital gains under section 48 of the Act. Therefore, in the instant case the provisions of section 54F(1)(a) are complied with by, the assessee and the assessee shall be eligible for deduction in respect of the whole of the capital gains so computed under section 45 read with section 48 and section 50C of the Act. The decisions of the Coordinate Benches as referred supra support the case of the assessee. The subject issue w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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