Commissioner of Income Tax-III V. Sri S.Ramesh Goud

ITTA/5/2014

AI Insights

The case revolves around the eligibility of the respondent, Sri S. Ramesh Goud, for a deduction under Section 54F of the Income Tax Act for the assessment year 2007-08. The primary legal question was whether the respondent could claim the deduction even though the new residential house was not purchased in his own name, but presumably in the name of a legal heir or another party. The Tribunal had previously ruled in favor of the respondent, citing liberal interpretations of the term 'assessee' in similar contexts. The Commissioner of Income Tax challenged this decision, leading to the present appeal. The High Court, referencing earlier judgments, affirmed the Tribunal's decision and dismissed the appeal, emphasizing the need for a liberal interpretation of 'assessee' to avoid frustrating the objectives of the exemption under Section 54F.

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 719016 (HC-ANDHRA_PRADESH)
• Appeal Type: Others
• Pronouncement Date: 28-01-2014
• Assessment Year: misc
• Other Referred Cases: Late Mir Gulam Ali Khan (by legal representative Mrs. Noor Begum) vs. Commissioner of Income Tax, CIT vs. Natarajan, CIT vs. Ravinder Kumar Arora
• Laws Referred To: Section 54F of the Act
• Result in Favour of: Others
• Court: HIGH COURT
• Assessee Lawyers: B SARMA
• Keywords: Deduction; Legal heirs; Liberal construction; Residential house
• Section: 54F

Judgement Text

"IN THE HIGH COURT OF JUDICATURE, ANDHRA PRADESH AT HYDERABAD THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE SRI JUSTICE SANJAY KUMAR I.T.T.A. No. 5 OF 2014 DATE: 28.01.2014 Between: Commissioner of Income Tax-III, Hyderabad … Appellant And Sri S. Ramesh Goud, Hyderabad. … Respondent This Court made the following: THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE SRI JUSTICE SANJAY KUMAR I.T.T.A. No. 5 of 2014 JUDGMENT: (Per the Hon’ble The Chief Justice Sri Kalyan Jyoti Sengupta) This appeal is sought to be preferred and admitted against the judgment and order dated 07.09.2012 of the learned Tribunal in relation to assessment year 2007-08 on the following suggested question of law. “In the facts and circumstances of the case, whether the Hon’ble Tribunal (ITAT) is correct in law in holding that the respondent – assessee was eligible for the benefit of deduction under Section 54F of the Act though the respondent – assessee has not purchased the new residential house in the respondent – assessee’s own name as per the provisions of the said Section 54F of the Act?” We have heard Sri B. Narasimha Sarma, learned counsel for the appellant, and gone through the impugned judgment and order of the learned Tribunal. We noticed that the learned Tribunal on the above issue had decided the matter following the judgment of this Court in case of Late Mir Gulam Ali Khan (by legal representative Mrs. Noor Begum) vs. Commissioner of Income Tax[1], Madras High Court in case of CIT vs. Natarajan[2] and Delhi High Court in case of CIT vs. Ravinder Kumar Arora[3]. While applying the aforesaid decisions, the learned Tribunal took the view that the word “assessee” mentioned under Section 54A should have exclusive meaning and definition, meaning thereby, the word “assessee” should be given a liberal construction instead of restrictive construction. Mr. Sarma says that the learned Tribunal has not understood the ratio of the judgment of this Court. We are unable to accept the said contention. The judgment of this Court in Late Mir Gulam Ali Khan (1 supra) clearly lay down as follows: “The word “assessee” in Section 54 must be given a wide and liberal interpretation so as to include his legal heirs also. There is no warrant for giving too strict an interpretation to the word “assessee” as that would frustrate the object of granting the exemption.” We do not find any reason to interfere with the ratio laid down by this Court earlier, as the said judgment is otherwise binding. It appears, the learned Tribunal, after applying the ratio as above, directed the authority below to verify the factual aspect in this matter. Accordingly, we do not find any element of law to be decided in this case. The appeal is accordingly dismissed. Pending miscellaneous petitions, if any, shall stand closed. ___________________ K.J. SENGUPTA, CJ ___________________ SANJAY KUMAR, J Date: 28.01.2014 ES [1] (1987) 165 ITR 228 [2] 287 ITR 271 (Mad) [3] 042 ITCL 498 "