TMI Blog2023 (3) TMI 316X X X X Extracts X X X X X X X X Extracts X X X X ..... for want of evidence of payment. AR has also not addressed us in this regard. As it is, now the claim has become only academic in nature. Accordingly, we decide all the additional grounds taken by the assessee before the Tribunal in favour of the assessee. Addition u/s 68 - assessee did not offer proper explanation as to the nature and source of the cash deposits and added the same to the income of the assessee - assessee in reply stated that during the year total amount was deposited by her husband in her bank accounts - HELD THAT:- CIT(A) disbelieved the explanation of the assessee merely for want of confirmation of deposits from the husband of the assessee without appreciating the circumstances under which the assessee was placed wherein she could not force her husband to confirm the deposits made by him in her bank accounts. The assessee has brought on record date-wise cash deposited in her bank accounts during the period from 01.04.2012 to 31.03.2015 as also the details of amounts received by the assessee as stridhan from 01.04.2012 to 31.03.2015. It is an admitted position that PAN of the creditor husband was given to the Ld. AO who could easily ascertain the creditw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Officer ( AO ) were not complied with. At last the Ld. AR of the assessee attended the assessment proceedings and filed the details/documents called for which the Ld. AO examined on test-check basis and placed on record. After discussion with the AR of the assessee, the Ld. AO completed the assessment on 23.03.2015 under section 143(3) of the Act computing the total income at Rs. 78,28,410/- including therein among others disallowance of Rs. 37,02,500/- being unexplained cash deposits and disallowance of Rs. 11,49,116/- being capital gain amount not deposited in bank. 4. The assessee filed appeal before the Ld. CIT(A). During appellate proceedings vide order sheet entry dated 07.06.2016 the Ld. CIT(A) required the assessee to submit certain information / evidence including show cause why exemption under section 54 be not proportionately reduced and income be enhanced as the exemption under section 54 is available in respect of only one property. Despite several opportunities given, no compliance was made. Therefore, the Ld. CIT(A) held that the assessee is not interested in pursuing the case and proceeded to decide the appeal ex-parte on merits. Before doing so, the Ld. CIT(A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sband of appellant. Neither any evidence nor any confirmation from Sh. Virender Singh was filed. The Assessing Officer even issued a notice u/s 133(6) to Sh. Virender Singh but no reply or confirmation has been received from him. It has merely been stated that since the relationship between the husband wife are not good, no evidence can be furnished. It is a fact that deposits have been made in cash in the account of the appellant. No evidence could be produced by appellant to show that deposits were made by the husband in the bank account. Even the returns of the husband does not show that he was a man of means. Furthermore, the appellant and her husband had already reached an agreement on 06.06.2014, whereby the husband was required to pay a sum of Rs. 75 lacs as alimony to the wife for separation. There was no mention of the amount deposited in the bank account of wife. Once the settlement had been reached, the appellant should not have been in any problem to get a certificate from the husband to the effect that money in bank account was deposited by him. In such circumstances, it can be clearly concluded that deposits in the bank account remained unexplained and represent the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reme Court in National Thermal Power Co. Ltd. vs. CIT (1998) 229 ITR 383 (SC) that where the Tribunal is only required to consider the question of law arising from facts which are on record in the assessment proceedings, there is no reason why such a question should not be allowed to be raised when it is necessary to consider that question in order to correctly assess the tax liability of an assessee. 10. Ground No. 1 has touching grievance of the assessee that though vide the notice of hearing sent by the Ld. CIT(A) to the assessee on 23.09.2016 fixing the case for 06.10.2016, the Ld. CIT(A) passed the order one day before i.e. on 05.10.2016. The contention of the assessee is borne out from para 6 of the appellate order itself. To say the least, this is against all the cannons of natural justice. The assessee succeeds in this ground. 11. The ground No. 2 is taken along with the additional grounds for consideration. Let us be clear on facts. i) The details of LTCG culled from the assessment order resulting in an addition of Rs. 11,49,116/- are as under:- Amount Sale consideration of property (Flat No. 55, C-Bl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ld. AO found that the assessee sold her flat No. 55, C-Block Sector-44, Noida for a total consideration of Rs. 2,40,00,000/- and earned LTCG of Rs. 1,78,53,468/- which she claimed as exempt under section 54 of the Act because she purchased two properties namely property No. 345, Block-C in Greater Noida for Rs. 79,71,600/- on 25.10.2011 and property No. 32-D, Mayur Vihar, Phase-III, Delhi for Rs. 65,60,000/- on 23.11.2011 aggregating in all to Rs. 1,45,31,600/- leaving capital gain balance of Rs. 33,21,868/- (Rs. 1,78,53,468/- - Rs. 1,45,31,600/-) as on 31.03.2012 i.e. end of the previous year relevant to AY 2012-13. According to the Ld. AO the assessee purchased other two properties in Mayur Vihar, Phase-III on 13.09.2012 and 19.10.2012 for Rs. 35,04,400/- (Rs. 17,52,200/- each) which dates fall after the due date of filing of return under section 139(1) of the Act. Therefore, the balance LTCG amount of Rs. 33,21,868/- was required to be kept in capital gain account with any nationalised bank for claiming exemption under section 54 of the Act. This was not done by the assessee. The Ld. AO issued show cause for denial of exemption, to which the assessee replied that out of total ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 139(4) of the Act on 25.10.2013 and therefore the entire sum of Rs. 35,04,400/- invested by the assessee towards purchase of the said two properties before filing the belated return under section 139(4) of the Act on 25.10.2013 is allowable for exemption under section 54 of the Act. In support he relied on the decision of Mumbai Tribunal in the case of Dr. Dharmista Mehta vs. ITO (2022) 144 taxmann.com 136. Without prejudice, the Ld. AR further contended that since the assessee had already made investment in two properties before the due date of filing belated return under section 139(4) of the Act and paid substantial amount, the exemption under section 54 can not be denied on the ground that balance amount of capital gain has not been deposited in the bank account with nationalised bank and in support cited the decision of Hon ble Karnataka High Court in CIT vs. K Ramachandra Rao 56 taxmann.com 163; Venkata Dilip Kumar vs. CIT 111 taxmann.com 180 (Mad.) and decision of Delhi Tribunal in Dr. Kushagra Kataria vs. DCIT 101 Taxmann.com 359 (Del.). The Ld. AR also objected to the enhancement made by the Ld. CIT(A) without issuing show cause notice which is the condition precedent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... latest being the decision in the case of Dr. Dharmista Mehta vs. ITO (supra) rendered on 22.10.2022 by Mumbai Tribunal wherein after noticing the Hon ble Supreme Court s decision in Prakash Nath Khanna vs. CIT (2004) 266 ITR 1 (SC); decision of Delhi Bench of the Tribunal in the case of Dr. Kushagra Kataria (supra), it held that subsection (2) of section 54 clearly provides a pigeonhole in the sense that the investment by way of purchase or construction, without resorting to the capital gains account scheme, can be made till the date of belated return under section 139(4) or revised return under section 139(5) as the wordings used in section 54(2) is section 139, and not section 139(1), which covers all sub-sections of section 139 . Thus, where the assessee files belated return under section 139(4) or revised return under section 139(5) in respect of the assessment year in which he transfers old/existing house, he is entitled to deduction under section 54 to the extent of investment in new house upto the date of filing of belated return under section 139(4)/revised return under section 139(5) even though he made no deposits of un-invested capital gain in capital gains account sche ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidential house within India. Accordingly, sub-section (1) of section 54 of the Income-tax Act has been amended to provide that the rollover relief under the said section is available if the investment is made in one residential house situated in India. 20.5 Applicability: - These amendments take effect from 1st April, 2015 and will accordingly apply in relation to assessment year 2015-16 and subsequent assessment years. 20. The Finance (No. 2) Act, 2014 itself mentions that in sub-section (1), the words constructed one residential house in India are substituted for constructed, a residential house w.e.f. 1st April, 2015. It is now well settled that where the law specifies the date from which an amendment will take effect, it is such date that is relevant. If it is a substantive law, it can apply only prospectively. The normal rule is that the law which prevails is the law as on 1st April of the assessment year. In Reliance Jute Industries Ltd. vs. CIT 120 ITR 921 (SC), the Hon ble Supreme Court observed that what applies is the law of the assessment year for the income of the previous year. This principle of law laid down by the Hon ble Supreme Court has been rei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5,00,000 04.11.2011 5,00,000 15.11.2011 5,00,000 16.11.2011 5,00,000 Total Cash = 37,02,500 24. On query raised by the Ld. AO, the assessee vide reply dated 16.02.2015 submitted that some cash was deposited in these bank accounts by her husband whose name, PAN No. and address was provided. The Ld. AO was not convinced as the money deposited by her and by her husband in these bank accounts had not been quantified. The Ld. AO issued and served notice under section 133(6) of the Act upon the husband of the assessee which was not complied with. However, the assessee vide reply dated 03.03.2015 stated that during the year total amount of Rs. 43 lakh was deposited by her husband in her bank accounts. It was also stated that family difference has arisen between the assessee and her husband and divorce petition has been filed in the court. Therefore, her husband ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d ground No. 3 and 4 relate thereto. 28. The Ld. AR submitted that family differences were going on between the assessee and her husband which finally ended up with divorce between them. Copy of petition for dissolution of marriage and copy of memorandum of understanding ( MOU ) dated 06.06.2014 filed before the Court appear at page 6 to 9 and page 3 to 5 respectively of the Paper Book filed by the assessee. Drawing out attention to the said MOU, the Ld. AR pointed out that the husband of the assessee was required to pay an amount of Rs. 75,00,000/- to the assessee towards permanent alimony. The Ld. AR submitted that the amount of Rs. 37,02,500/- received by the assessee during the year is part of lumpsum alimony of Rs. 75,00,000/- agreed between the assessee and her husband as per MOU. The details of alimony of Rs. 75,00,000/- received by the assessee during the period from 01.04.2011 to 31.03.2015 are at page 1-2 of Paper Book which also include the amount of Rs. 37,02,500/- received during the previous year relevant to AY 2012-13. The Ld. AR argued that lumpsum alimony received at the time of divorce is capital receipt not taxable in the hands of the recipient assessee and re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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