Appeal Details
Counselvise Citation
[2016] 123 COUNSELVISE.COM (IT) 2341 (ITAT-CHENNAI)
Assessee PAN
Bench
Appeal Number
CRN Number
Duration Of Justice
11 month(s) 28 day(s)
Appellant
Respondent
Appeal Type
Cross Objection
Pronouncement Date
22-04-2016
Appeal Filed By
Assessee
Order Result
Dismissed
Bench Allotted
A
Next Hearing Date
04-02-2016
Assessment Year
2005-2006
Appeal Filed On
24-04-2015
Judgement Text
, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI , . ! , '!# BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ./ I.T.A. NO.415/MDS/2015 & C.O.NO.43/MDS/2015 (IN ITA NO.415/MDS/2015) ' $ %$ / ASSESSMENT YEAR : 2005-2006 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE I, CUDDALORE VS. SMT. UMAYAL ANNAMALAI, NO.66/22-A-2, THERADI PILLAIYAR KOIL STREET, CHIDAMBARAM [PAN AGSPA 6407B] ( / APPELLANT) ( /RESPONDENT/CROSS OBJECTOR) &' ( ) / APPELLANT BY : SHRI. P. RADHAKRISHNAN, IRS, JCIT *+&' ( ) /RESPONDENT BY : SHRI.N. QUADIR HOSEYN, ADV ( , / DATE OF HEARING : 04-02-2016 -.% ( , / DATE OF PRONOUNCEMENT : 22-04-2016 / O R D E R PER G. PAVAN KUMAR, JUDICIAL MEMBER : THE APPEAL OF THE REVENUE AND CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST COMMON ORDER OF THE COMMISSIONER OF ITA NO. 415/2015 & CO.43/2015 :- 2 -: INCOME-TAX (APPEALS)-VI, CHENNAI FOR THE ASSESSMENT YEAR 2005-06 IN ITA NO.709/13-14/A-VI, DT 30.10.2014 PASSED U/S.143 (3) AND 250 OF THE INCOME TAX ACT, 1961 (HEREIN AFTER REFERRED TO AS THE ACT). 2. THERE IS A DELAY OF 47 DAYS IN FILING THE APPEAL BY THE DEPARTMENT. AT THE TIME OF HEARING THE LD. DEPARTM ENTAL REPRESENTATIVE HAS FILED AN AFFIDAVIT EXPLAINING THE REASONS FOR DELAY AND THE LD. AR HAS NO SERIOUS OBJECTIONS FOR CONDON ATION OF DELAY. AFTER HEARING THE SUBMISSIONS, WE ARE SATISFIED WIT H SUFFICIENT AND REASONABLE CAUSE FOR FILING THE APPEAL BELATEDLY AN D WE THEREFORE CONDONE THE DELAY AND ADMIT THE APPEAL. 3. THE BRIEF FACTS OF THE CASE THAT THE ASSESSEE IS AN INDIVIDUAL HAVING INCOME FROM SALARY, INCOME FROM HOUSE PROPER TY AND INTEREST INCOME AND FILED RETURN OF INCOME ON 17.03.2006 WIT H TOTAL INCOME OF >5,28,430/-. THE ASSESSEE MADE INVESTMENTS DURING THE FINANCIAL YEAR AND NOTICE WAS ISSUED U/S.148 OF THE ACT AND A SSESSMENT WAS COMPLETED ON 04.12.2009 DETERMINING TOTAL INCOME A T >9,65,440/-. SUBSEQUENTLY, THE ASSESSING OFFICER FOUND THAT ASS ESSEE HAS SOLD SHARES OF CTL AMOUNTING TO >81,63,440/- AND CLAIMED EXEMPTION U/S.54EC AND >10,00,000/- BY INVESTING IN NABARD BONDS AND FOR BALANCE CLAIMED EXEMPTION U/S.54F BY UTILIZING THE FUNDS IN THE ITA NO. 415/2015 & CO.43/2015 :- 3 -: CONSTRUCTION OF FLAT IN BANGALORE. THE LD.ASSESSIN G OFFICER FOUND THE ASSESSEE HAS NOT SUBMITTED PROOF OF INVESTMENT IN B OND >10,00,000/- AND ALSO NOT DISCLOSED VALUE OF FLAT >72,00,000/ - IN THE BALANCE SHEET AS ON 31.03.2005 AND BELIEVED THAT THE INCOME CHARG EABLE TO TAX HAS ESCAPED ASSESSMENT AND ISSUED NOTICE U/S148 OF THE ACT. IN COMPLIANCE TO NOTICE, THE ASSESSEE FILED LETTER DAT ED 13.07.2012 TO TEAT ORIGINAL RETURN OF INCOME FILED FOR ASSESSMENT PURP OSE. THE LD. AUTHORISED REPRESENTATIVE OF THE ASSESSEE APPEARED AND FURNISHED PROOF OF INVESTMENT OF >10,00,000/- IN NABARD CAPIT AL GAINS BOND AND EXPLAINED THAT THE ASSESSEE CLAIMED EXEMPTION U /S.54F OF THE ACT BY INVESTING IN RESIDENTIAL PROPERTY. THE LD. AUTH ORISED REPRESENTATIVE ALSO PRODUCED COPIES OF SALE AGREEMENT AND CONSTRUC TION AGREEMENT OF FLAT NO.4B, BEARYERS ACACIA LAKEVIEW, BANGALORE. O N PERUSAL OF THE AGREEMENTS, THE ASSESSING OFFICER FOUND THAT THE AG REEMENT WAS ENTERED ON 13.12.2006 AND NOT COMPLIED CAPITAL GAIN ACCOUNTS SCHEME BEFORE DUE DATE U/S..139(1) OF THE ACT AND ALLEGED THE SAID INVESTMENT OF >72,00,000/- IN THE PROPERTY AFTER DUE DATE AN D OBSERVED THAT ASSESSEE HAS UTILIZED NET CONSIDERATION ONLY AFTER DUE DATE OF FILING OF RETURN U/S.139(1) OF THE ACT AND DENIED EXEMPTION U /S.54F OF THE ACT AND ASSESSED TOTAL INCOME OF >54,48,750/- AND RAIS ED DEMAND. AGGRIEVED BY THE ORDER, THE ASSESSEE FILED AN APPEA L BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS). ITA NO. 415/2015 & CO.43/2015 :- 4 -: 4. IN THE APPELLATE PROCEEDINGS, THE LD. AUTHORISED REPRESENTATIVE REITERATED THE SUBMISSIONS MADE IN A SSESSMENT PROCEEDINGS AND CHALLENGED THE VALIDITY OF REOPENIN G OF ASSESSMENT AS REOPENING WAS BASED ON AUDIT OBJECTION AND ALLEGED THE ORDER OF RE- ASSESSMENT IS BAD IN LAW. THE LD. AUTHORISED REPRE SENTATIVE FURTHER ARGUED THAT THE ASSESSING OFFICER IS NOT CORRECT IN OBSERVING THAT THE ASSESSEE HAS NOT INVESTED THE NET CONSIDERATION IN THE CAPITAL GAIN SCHEME BUT ASSESSEE HAS COMPLETED THE CONSTRUCTION OF THE RESIDENTIAL PROPERTY WITHIN THE STIPULATED TIME AND DISCLOSED IN BALANCE SHEET AS ON 31.03.2008. THE ASSESSEE ADVANCED MONEY AT INIT IAL STAGE AND ENTERED INTO AGREEMENT ONLY IN 2006 AND COMPLETED CONSTRUCTION WITHIN THREE YEARS FROM THE DATE OF TRANSFER OF PRO PERTY WHICH IN NOT DISPUTED BY THE ASSESSING OFFICER EXCEPT THAT AMOUN T WAS NOT DEPOSITED IN CAPITAL GAIN SCHEME 1988 BEFORE DUE DA TE U/SEC. 139(1) OF THE ACT. THE LD. COMMISSIONER OF INCOME TAX (AP PEALS) PERUSED THE GROUNDS AND CONSIDERED THE FINDINGS OF THE ASS ESSING OFFICER AND SUBMISSIONS MADE IN THE APPELLATE PROCEEDINGS ON TH E GROUND OF VALIDITY OF REASSESSMENT PROCEEDINGS, THE COMMISSIO NER OF INCOME TAX (APPEALS) HAS DEALT ON THE REASONS FOR ISSUE OF NO TICE U/S.148 OF THE ACT AS THERE WAS NO EVIDENCE IN EARLIER ASSESSMENT TO PROVE THE ASSESSMENT RECORD IS COMPLETE AND DISCUSSED IN PAR A 3 & 4 OF HIS ORDER AS REASONS BEING GENUINE AND THERE WAS A SC OPE FOR ITA NO. 415/2015 & CO.43/2015 :- 5 -: ESCAPEMENT OF INCOME. THE LD. ASSESSING OFFICER HA S APPLIED HIS MIND CAREFULLY BEFORE RECORDING REASONS AND ISSUED NOTIC E U/S.148 OF THE ACT AS THE INFORMATION OF INVESTMENT IN NABARD CAPITAL BOND U/S.54EC OF THE ACT AND THE PURCHASE AND CONSTRUCTION OF PROPER TY ARE NOT SUPPORTED WITH EVIDENCE. THEREFORE THE LD. ASSESSI NG OFFICER HAS SUFFICIENT REASONS AND RE-OPENING OF ASSESSMENT IS IN ORDER AND CONFIRMED THE ORDER OF THE ASSESSING OFFICER AND R EJECTED THE ASSESSEE GROUND. 5. ON THE GROUNDS OF CLAIM FOR DEDUCTION U/S.54F OF THE ACT, THE ASSESSEE HAS INVESTED THE NET CONSIDERATION IN CONSTRUCTION OF RESIDENTIAL PROPERTY ONLY AFTER DUE DATE OF FILING OF RETURN. THE LD. AUTHORISED REPRESENTATIVE FILED WRITTEN SUBMISSIONS DATED 27.10.2014 SUPPORTING THE CLAIM OF DEDUCTION U/S.54F OF THE AC T ALONGWITH LEGAL PROVISIONS AND JUDICIAL DECISIONS. THE LD. COMMISS IONER OF INCOME TAX (APPEALS) HAS CONSIDERED SUBMISSIONS AT PAGE 5 TO 9 OF HIS ORDER, WITH FINDINGS AND FACTUAL ASPECTS OF INVESTMENTS, F OUND THAT THE ASSESSEE IS AN INDIVIDUAL AND DUE DATE OF FILING OF RETURN OF INCOME IS 31.07.2005 AND DATE FOR FILING BELATED RETURN U/S.1 39(4) OF THE ACT BEING 31.03.2007 AND THE ASSESSEE HAS SPENT >68,00, 000/- FOR PURCHASING AND CONSTRUCTION OF THE PROPERTY TILL 31 .03.2007. ON COMPARISON WITH THE SALE CONSIDERATION OF >81,63,44 0/- THE ASSESSEE ITA NO. 415/2015 & CO.43/2015 :- 6 -: HAS UTILIZED >68,00,000/- BEFORE THE EXTENDED DATE OF FILING OF RETURN U/S.139(4) OF THE ACT. THE PROPERTY WAS SOLD ON 1 4.02.2005 AND NEW RESIDENTIAL PROPERTY WAS CONSTRUCTED AND POSSESSION WAS TAKEN ON 15.12.2007, WHICH IS WITHIN THREE YEARS PERIOD FR OM THE DATE OF TRANSFER OF ASSET. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) FOUND THAT SUBSTANTIAL PART OF SALE CONSIDERATION W AS UTILIZED FOR ACQUISITION OF NEW ASSET WITHIN THE STIPULATED EXTE NDED TIME AND THE ASSESSEE HAS COMPLIED WITH THE BASIC CONDITIONS U/ S. 54F(1) OF THE ACT. WITH THESE FINDINGS, LD. COMMISSIONER OF INCO ME TAX (APPEALS) OBSERVED AT PARA 5.2.1 OF HIS ORDER AS UNDER:- 5.2.1 I HAVE CONSIDERED THE FINDINGS OF THE AO AND ALSO SUBMISSIONS MADE BY THE AR OF THE APPELLANT AND ALS O PERUSED THE COPY OF THE JUDGEMENTS FILED WITH THE S UBMISSION. IN THE INSTANT CASE, THE DUE DATE OF FILING RETURN OF INCOME U/S 139(1) OF THE IT ACT WAS 31.07.2005 AND DUE DATE FO R FILING OF RETURN OF INCOME U/S 139(4) OF THE IT ACT WAS 31.03 .2007. THE APPELLANT HAS SPENT 68 LAKHS TILL 31.03.2007 FOR THE PURPOSE OF PURCHASING HOUSE PROPERTY. THEREFORE, OUT OF THE TOTAL SALE CONSIDERATION OF RS.81,63,440/-, THE APPELLANT HAS UTILIZED .68 LAKHS BEFORE THE EXTENDED DATE OF FILING OF RETURN OF INCOME U/S 139(4) OF THE IT ACT. POSSESSION OF NEW PROPERTY WA S TAKEN ON 15-12-2007 WITHIN PERIOD OF 3 YEARS FROM DATE OF TR ANSFER OF ORIGINAL ASSET I.E ON 14-02-2005. THUS, THE APPELLA NT HAS PURCHASED THE PROPERTY WITHIN THE STIPULATED PERIOD U/S 54F(1) OF THE IT ACT. THE ISSUE INVOLVED IN THE APPEAL IS WHETHER THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S 54F OF THE I .T ACT IN A CASE WHERE SUBSTANTIAL PART OF SALE CONSIDERATION W AS UTILIZED FOR ACQUISITION OF NEW ASSET WITHIN EXTENDED DATE O F FILING OF RETURN OF INCOME U/S 139(4) OF THE I.T ACT 1961 PAR TICULARLY WHEN MAIN CONDITIONS U/S 54F(1) WERE FULFILLED. THE HON'BLE HIGH COURT OF PUNJAB & HARYANA IN THE CASE OF CIT VS JAGTAR SINGH CHAW!A REPORTED IN [2013] 215 TAXMAN 154 HELD THAT THE ASSESSEE IS NOT LIABLE FOR PAYMENT OF CAPITAL GAINS TAX WHEN SUBSTANTIAL AMOUNT OF SALES CONSIDERATION FOR PURCH ASE OF ITA NO. 415/2015 & CO.43/2015 :- 7 -: RESIDENTIAL PROPERTY WAS MADE BEFORE THE EXTENDED P ERIOD OF LIMITATION OF FILING OF RETURN OF INCOME I.E. 139(4 ) OF THE IT ACT. THE HO'BLE ITAT A BENCH IN THE CASE OF ANIL KUMAR A URORA REPORTED IN [2013] 37 CCH 221 (MUM) ALSO HELD THE S IMILAR VIEW. THE HON'BLE GAUHATI HIGH COURT IN THE CASE OF RAJESH KUMAR JALAN REPORTED IN 286 ITR 274 HELD THAT THE C APITAL GAINS IS NOT CHARGEABLE WHEN THE APPELLANT HAS PURC HASED THE NEW PROPERTY BEFORE THE EXTENDED DUE DATE OF FILING OF RETURN U/S 139(4) OF THE IT ACT FOR THE PURPOSE OF CLAIM O F DEDUCTION U/S 54 OF THE IT ACT. UTILIZATION OF THE FUNDS IN C ONSTRUCTING THE RESIDENTIAL HOUSE WITHIN THE STIPULATED PERIOD SHOU LD BE TREATED AS SUFFICIENT COMPLIANCE OF SEC. 54 OF THE IT ACT I N THE CASES DECIDED BY JURISDICTIONAL TRIBUNAL IN THE CASE OF MADHUVANPRASAD IN ITA NO.2485/MDS/2004 AND K.S.RAMACHANDRAN IN ITA NO.941/MDS/2011. THE WORDIN G OF THE SEC.54 & 54F IN THE MANNER OF UTILIZATION OF TH E FUNDS ARE SIMILAR. THEREFORE, SINCE IN THIS CASE RS.68 LAKHS WAS UTILIZED BY THE APPELLANT BEFORE 31.03.2007 I.E. THE DUE DAT E OF FILING OF RETURN OF INCOME U/S 139(4) OF THE IT ACT IN THE CA SE OF THE APPELLANT, THE AO SHALL CONSIDER THE CLAIM OF GRANT ING THE DEDUCTION PROPORTIONATE TO THE INVESTMENT IN THE NE W PROPERTY AS ON 31.03.2007. THEREFORE, THE AO IS DIRECTED TO RECALCULATE THE ALLOWABLE DEDUCTION AS PER THE DIRECTIONS OF TH E ABOVE AND GRANT RELIEF ACCORDINGLY. AND DELETED THE ADDITION. AGGRIEVED BY THE ORDER, THE REVENUE HAS ASSAILED AN APPEAL BEFORE TRIBUNAL. 6. BEFORE US, THE LD. DEPARTMENTAL REPRESENTATIVE RE ITERATED THE FINDINGS OF THE ASSESSING OFFICER AND ARGUED TH AT THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DELETING THE ADDIT ION AND ALSO FAILED TO APPRECIATE THAT THE ASSESSEE HAS UTILIZED NET CO NSIDERATION AFTER DUE DATE OF FILING OF RETURN. FURTHER AS PER CAPITAL GAIN SCHEME FOR CLAIMING EXEMPTION U/S.54F, THE ASSESSEE SHOULD PUR CHASE OR CONSTRUCT NEW ASSET WITHIN THREE YEARS FROM THE DA TE OF TRANSFER OF ASSET AND THE AMOUNT SHOULD BE DEPOSITED UNDER CAPI TAL GAIN ACCOUNT ITA NO. 415/2015 & CO.43/2015 :- 8 -: SCHEME BEFORE DUE DATE OF RETURN U/S.139(1) OF THE ACT. THEREFORE, ACTION OF THE COMMISSIONER OF INCOME TAX (APPEALS) IN DELETING THE ADDITION IS NOT IN ACCORDANCE WITH LAW. 7. CONTRA, THE LD. AUTHORISED REPRESENTATIVE ARGUED TH AT THE ASSESSEE HAS PASSED THROUGH THE SECOND ROUND OF RE -ASSESSMENT AS THE EARLIER ASSESSMENT WAS COMPLETED U/S.143(3) OF THE ACT R.W.S 147 ON 4.12.2009 AND ON SAME ISSUE WITH CHANGE OF OPINI ON, THE ASSESSING OFFICER HAS DENIED THE EXEMPTION U/S.54F ON THE GR OUND THAT ASSESSEE HAS NOT UTILIZED THE NET SALE CONSIDERATION BEFORE DUE DATE OF FILING OF RETURN OF INCOME AND THE ASSESSEE HAS SUBSTAINTED W ITH EVIDENCE OF INVESTMENTS BEFORE THE LOWER AUTHORITIES AND RELIE D ON THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) AND PRAYED FOR DISMISSING THE APPEAL. 8. WE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIA L ON RECORD AND JUDICIAL DECISIONS CITED. THE LD. DEPART MENTAL REPRESENTATIVE CONTENTION BEING THE ASSESSEE THOUG H CONSTRUCTED THE PROPERTY BY INVESTING, THE NET SALE CONSIDERATION BUT NOT BEFORE THE DUE DATE OF RETURN U/S.139(1) OF THE ACT NOR SAID A MOUNT WAS DEPOSITED IN CAPITAL GAIN ACCOUNT SCHEME. THE ARGU MENT OF LD. DEPARTMENTAL REPRESENTATIVE WAS IN RESPECT OF THE P ERIOD OF ITA NO. 415/2015 & CO.43/2015 :- 9 -: CONSTRUCTION AND THERE IS NO DISPUTE ON INVESTMENT OF THE NET CONSIDERATION IN RESIDENTIAL PROPERTY AND PROVISION OF SEC. 54F(1) OF THE ACT ARE AS UNDER:- 54F. (1) [SUBJECT TO THE PROVISIONS OF SUB-SECTION (4), WHERE, IN THE CASE OF AN ASSESSEE BEING AN INDIVIDUAL OR A HINDU UNDIV IDED FAMILY], THE CAPITAL GAIN ARISES FROM THE TRANSFER OF ANY LONG-T ERM CAPITAL ASSET, NOT BEING A RESIDENTIAL HOUSE (HEREAFTER IN THIS SECTIO N REFERRED TO AS THE ORIGINAL ASSET), AND THE ASSESSEE HAS, WITHIN A PER IOD OF ONE YEAR BEFORE OR [TWO YEARS] AFTER THE DATE ON WHICH THE TRANSFER TOOK PLACE PURCHASED, OR HAS WITHIN A PERIOD OF THREE YEARS AFTER THAT DA TE [ CONSTRUCTED, A RESIDENTIAL HOUSE ] (HEREAFTER IN THIS SECTION REFERRED TO AS THE NEW ASSET), THE CAPITAL GAIN SHALL BE DEALT WITH IN ACCORDANCE WITH THE FOLLOWING PROVISIONS OF THIS SECTION, THAT IS TO SAY, (A) IF THE COST OF THE NEW ASSET IS NOT LESS THAN THE N ET CONSIDERATION IN RESPECT OF THE ORIGINAL ASSET, THE WHOLE OF SUCH CAPITAL GAIN SHALL NOT BE CHARGED UNDER SECTIO N 45 ; (B) IF THE COST OF THE NEW ASSET IS LESS THAN THE NET C ONSIDERATION IN RESPECT OF THE ORIGINAL ASSET, SO MUCH OF THE CA PITAL GAIN AS BEARS TO THE WHOLE OF THE CAPITAL GAIN THE SAME PROPORTION AS THE COST OF THE NEW ASSET BEARS TO THE NET CONSI DERATION, SHALL NOT BE CHARGED UNDER SECTION 45 : [ PROVIDED THAT NOTHING CONTAINED IN THIS SUB-SECTION SHALL A PPLY WHERE (A) THE ASSESSEE, (I) OWNS MORE THAN ONE RESIDENTIAL HOUSE, OTHER THA N THE NEW ASSET, ON THE DATE OF TRANSFER OF THE ORIGINAL ASSE T; OR (II) PURCHASES ANY RESIDENTIAL HOUSE, OTHER THAN TH E NEW ASSET, WITHIN A PERIOD OF ONE YEAR AFTER THE DATE OF TRANS FER 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 TR ANSFER OF THE ORIGINAL ASSET; AND (B) THE INCOME FROM SUCH RESIDENTIAL HOUSE, OTHER T HAN THE ONE RESIDENTIAL HOUSE OWNED ON THE DATE OF TRANSFER OF THE ORIGINAL ASSET, IS CHARGEABLE UNDER THE HEAD INCOME FROM HOUSE PROPERTY.] ITA NO. 415/2015 & CO.43/2015 :- 10 -: THE ASSESSEE HAS COMPLIED THE PROVISIONS CONSIDERIN G THE DATES AS UNDER:- (I) DATE OF TRANSFER OF ORIGINAL ASSET : 14.02.2005. (II) THE DATE OF FILING OF RETURN : 17.03.2006. (III) DUE DATE OF RETURN FOR THE ASSESSMENT YEAR 2005-06 : 31.07.2005. (IV) DUE DATE OF FILING BELATED RETURN : 31.03.2007 . (V) POSSESSION OF THE PROPERTY : 15.12.2007. ON CONSIDERING THE PROVISIONS OF LAW AND FACTS OF T HE CASE, THE ASSESSEE HAS INVESTED >68,00,000/- BEFORE DUE DATE OF FILING BELATED RETURN I.E. 31.03.2007 AND TOOK THE POSSESSION AS PER THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APPEALS) ON 15.12.2 007, BEING WITHIN THREE YEARS FROM THE DATE OF TRANSFER/SALE OF ORIGINAL ASSET BEING 14.02.2005. THE ASSESSEE HAS NOT INVESTED IN CAPITAL GAIN ACCOUNT SCHEME BEFORE 139(1) OF THE ACT BUT COMPLI ED WITH THE CONDITIONS U/S.54F(1) OF THE ACT BY PURCHASING AND CONSTRUCTION OF RESIDENTIAL PROPERTY WITHIN THREE YEARS FROM THE DA TE OF TRANSFER OF ORIGINAL ASSET WHICH IS NOT DISPUTED IN THE ASSESSM ENT PROCEEDINGS OR IN APPELLATE PROCEEDINGS. THE PROVISIONS OF SEC. 54 F ARE BENEFICIAL PROVISIONS AND ARE TO BE CONSIDERED LIBERALLY IN TH E ASPECT OF LIMITATION PERIOD. BUT THE INVESTMENT IN RESIDENTIAL PROPERTY IS MUST WHICH THE ASSESSEE HAS PROVED WITH EVIDENCE AND COMPLIED BEF ORE THE LOWER AUTHORITIES. THE LD. COMMISSIONER OF INCOME TAX (A PPEALS) RELIED ON THE LEGAL PROVISION AND SUBMISSIONS OF THE ASSESSEE EXHAUSTIVELY WITH JUDICIAL DECISIONS. CONSIDERING THE FACTUAL ASPEC TS, GENUINESS OF THE ITA NO. 415/2015 & CO.43/2015 :- 11 -: TRANSACTIONS AND BENEFICIAL ASPECTS OF THE PROVISIO NS, WE ARE OF THE OPINION THAT THE COMMISSIONER OF INCOME TAX (APPEAL S) HAS RIGHTLY CONSTRUED THE FINDINGS AND THE EXPLANATION OF THE A SSESSEE WITH OBSERVATION IN HIS ORDER AND ALLOWED THE DEDUCTION U/S.54F OF THE ACT. THEREFORE, WE ARE NOT INCLINED TO INTERFERE WITH TH E ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) AND DISMISS TH E GROUND OF THE REVENUE. 9. THE ASSESSEE HAS FILED CROSS OBJECTION AND SUBMITT ED THAT THE REASSESSMENT PROCEEDINGS ARE BAD IN LAW AND ERR ONEOUS AS ASSESSMENT WAS REOPENED ONLY ON AUDIT OBJECTION, W HICH AMOUNTS TO CHANGE OF OPINION WHICH IS NOT PERMISSIBLE. THE AS SESSEE COMPLIED THE AUDIT OBJECTIONS BY SUBMITTING THE EXPLANATION WITH PROOF OF INVESTMENTS U/S.54EC OF THE ACT AND ASSESSEE HOLD O NLY ONE RESIDENTIAL PROPERTY ON THE DATE OF SALE AND OTHER PROPERTIES A RE COMMERCIAL PROPERTIES. 10. WE FIND THAT THE REASSESSMENT HAVE BEEN INITIATED O NLY BECAUSE OF NON AVAILABILITY OF EVIDENCE ON RECORD. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS CONSIDERED THE FACTUAL ASPECTS, OBJECTIONS AND FINDINGS AND RELIED ON JU DICIAL DECISIONS AND REJECTED THE ASSESSEES CONTENTION AND WE DO NOT F IND ANY INFIRMITY IN ITA NO. 415/2015 & CO.43/2015 :- 12 -: THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) O N THE GROUND OF VALIDALITY OF REASSESSMENT PROCEEDINGS AND UPHOLD T HE SAME. THE C.O. FILED BY THE ASSESSEE IS DISMISSED. 11. IN THE RESULT, THE APPEAL OF THE REVENUE AND C.O. OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED ON FRIDAY, THE 22ND DAY OF A PRIL, 2016, AT CHENNAI. SD/- SD/- ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER ( . ! ) (G. PAVAN KUMAR) /JUDICIAL MEMBER / CHENNAI 0 / DATED:22.04.2016 KV 1 ( *',23 43%, / COPY TO: 1 . &' / APPELLANT 3. 5, () / CIT(A) 5. 389 *',' / DR 2. *+&' / RESPONDENT 4. 5, / CIT 6. 9:$ ; / GF
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