TMI Blog2022 (8) TMI 437X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, we hold that the Assessing officer has rightly restricted assessee s claim for deduction u/s 54F for Flat No.402 only. Accordingly, grounds of appeal raised by the assessee is dismissed. - ITA No.1764/PUN/2019 - - - Dated:- 15-7-2022 - Shri S.S.Godara, Judicial Member And Dr. Dipak P. Ripote, Accountant Member For the Assessee : Shri Pramod S Shingte AR For the Revenue : Shri Arvind Desai DR ORDER PER DR. DIPAK P.RIPOTE, AM: This appeal filed by the Assessee is directed against the order of ld.Commissioner of Income-tax(Appeals)-8, Pune s, order dated 24.09.2019 for the Assessment Year 2013-14. The appellant Assessee has raised the following grounds of appeal: 1. On the facts and in the circumstances of the case and in law the Lower Authorities has erred not granting the exemption u/s 54F under Income Tax Act, 1961 for Rs.24,69,227/- without appreciating the fact that your appellant has purchased two adjacent flats which were used as a single unit and therefore appellant is entitled for exemption as claimed. We pray accordingly. The appellant craves for to leave, add, alter, modify, delete above ground of appeal before or at the ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd have one kitchen, also cannot be accepted in light to eligibility for exemption u/s 54F of the Act. The appellant bought another flat no. 402 in his name after 10 month of buying flat no. 1, and then claimed to have join to make one residential unit. Since, the flat no. 401 was purchased prior to one year instead of what envisaged in section 54F of the act; it is out of purview of the provisions. The said flat 401 and 402 cannot be considered a single residential unit as held in CIT vs Devdas Naik (2014) by Hon ble Bombay High court for the instant case, because flat no. 401, was purchased prior to one year of sale of original asset. Accordingly, in light of above discussion, Ground No. 1 is DISMISSED. 4. Aggrieved by the order of the ld.CIT(A) the assessee filed appeal before the Tribunal. 5. The Learned Authorized Representative(ld.AR) for the assessee submitted that the assessee had purchased the Flat No.401 in his wife s name for the security of his wife. Though, the Flat No.401 was purchased by registered agreement dated 11/08/2011 in the name of Mrs. Uma D Mundada but then there was a supplementary agreement on 27/07/2012 vide which the carpet area of the flat was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ay,- (a) if the cost of the new asset is not less than the net consideration in respect of the original asset, the whole of such capital gain shall not be char under section 45 ; (b) if the cost of the new asset is less than the net consideration in respect of the original asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of the new asset bears to the net consideration, shall not be charged under section 45: [Provided that nothing contained in this sub-section shall apply where- (a) the assessee,- (i) owns more than one residential house, other than the new asset, on the date of transfer of the original asset; or (ii) purchases any residential house, other than the new asset, within a period of one year after the date of transfer of the original asset; or (iii) constructs any residential house, other than the new asset, within a period of three years after the date of transfer of the original asset; and (b) the income from such residential house, other than the one residential house owned on the date of transfer of the original asset, is chargeable under the head Income from house pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a 'legal interpretation' and not a 'liberal interpretation', as contended by the learned counsel for the appellant. If the word 'assessee' is given a liberal interpretation, it would be tantamount to giving a free hand to the assessee and his legal heirs and it shall curtail the revenue of the Government, which the law does not permit. 9. The Income Tax Appellate Tribunal, having considered all the facts and circumstances of the case, is found to have rightly disallowed the exemption under Section 54B of the Act. Unquote. 8.4. Hon ble Delhi High Court has held in the case of Vipin malik vs CIT 183Taxmann 296 (Delhi) as under : Quote , 9. Independent of the above discussion, an aspect which overrides the above issue, is that, the agricultural land which was sold was of Vipin Malik HUF and the flat purchased in the co-operative society was not in the name of the HUF. The flat was in the individual name of Vipin Malik along with his mother Smt. Chanan Devi Sachdeva. To claim the benefit of section 54F the residential house which is purchased or constructed has to be of the same assessee whose agricultural land is sold and which is therefore, n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 19-10-1995 which again was addressed to Smt. Chanan Devi Sachdeva and Shri Vipin Malik without there being any mention or indication of HUF. Pages 12, 14 and 15 are the Photostat copies of the receipts issued by the said society for payments made by the assessee on 31-10-1995, 12-6-1998 and 19-5- 1999 which again are issued in the name of two individuals without there being any mention of HUF. Page 13 is the ledger account extract from the books of the society for the period 1-4-1996 to 31-3-1997 with a title of account being Chanan Devi Sachdeva and Vipin 237 which again goes to show that the membership was stated to be held jointly by the said individuals without there being any indication of HUF. The only document which contains the name of HUF with reference to Shri Vipin Malik as Karta of HUF is a possession certificate issued by the society on 30-4-2000 and a perusal of the copy of the said certificate placed at page No. 16 of the assessee's paper book shows that the words (Karta), M/s. Vipin Malik-HUF are written in capital letters against the name of Shri Vipin Malik which appears in small letters. Even the manner in which the said words are written in the said cert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has, therefore, not made the investment in this name. Therefore, he has rendered himself liable to pay tax on capital gains arising out of the transfer of a capital asset. 9.****** 10. In all the above case, it will be significant to note that the issue was never regarding purchase of the new asset in the name of other person. Death during the period within which the new asset had to be acquired was an intervening event in some cases. The distinction between a legal heir and a heir apparent in law is very significant. A heir apparent succeeding to the estate of a prepesitus is dependent on the fact of his surviving the prepositus. Death is a certain event but who will die first is not a certain event. This is the reason why law regards transfer by a heir apparent of his chance of succession as non-transferable under section 6 of the Transfer of Property Act. 11. .... In the present case, the assessee has not made any such claim. In the affidavit filed before the Assessing Officer he had admitted that his son is the beneficial owner of the property and the investment was made in his name in view of the fact that he is 86 years old and that he was counseled to do so. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cannot claim the benefit of exemption u/s 54B. 5. It is seen that the Hon'ble Delhi High Court in CIT v. Kamal Wahal [2013] 30 taxmann.com 34/214 Taxman 287/351 ITR 4 and the Hon'ble Punjab Haryana High Court in CIT v. Gurnam Singh [2008] 170 Taxman 160/[2010] 327 ITR 278 have decided similar issue in favour of the assessee by allowing exemption u/s 54B observing that the assessee having invested sale proceeds of his agricultural land in purchasing another agricultural land, though in a joint name with his son, was eligible for exemption. Identical view in favour of the assessee has been canvassed by certain other Hon'ble High Courts also. 6. On the contrary, the Hon'ble jurisdictional High Court in Prakash (supra) has disentitled the assessee to the claim of exemption when a new property is not purchased in the name of assessee, who transferred the original property. The Hon'ble Punjab Haryana High Court in a later decision in the case of CIT v. Dinesh Verma [2015] 60 taxmann.com 461/233 Taxman 409 considered a case in which the new property was not purchased in the name of the assessee who transferred the original property. The Hon'ble High C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 1,25,000/- own fund of Mrs. Uma Mundada, initial payment to builder. Rs.3,75,000/- borrowed from partnership firm Ridkaran Bansilal Mundataby Mrs. Uma to pay to builder for flat no.401 Rs. 5,00,000/- loan taken from Sangita by Mrs Uma for the flat. Rs.2,00,000/- loan taken by Mrs.Uma from the partnership firm . Loan of Rs.5,00,000/- from lunkad reality by Mrs.Uma Remaining Home Loan from ICICI Bank in joint name of Dilip Mundada and Mrs.UmaMundada. The Home loan is in join name because the bank normally ask for joint name to secure the repayment. Therefore, though the Flat No. 402 which is in the name of Dilip Mundada also have home loan in joint name with Mrs.Uma Mundada. Thus the payments were also made by Mrs. Uma Mundada. 9.1. However, as discussed in the earlier paras the new house should have been purchased by the assessee. The section 54F does not say that the assessee shall invest in the new house but it says the assessee shall purchase new house. Therefore, even on this ground the rejection of claim of section 54F for the Flat No. 401 is justified. Therefore, we hold that the Assessing officer has rightly restricted assessee s claim for deduc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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