Mr. Sandeep Taneja, Delhi V. ITO, New Delhi

ITA 11/DEL/2017

• Counselvise Citation: [2018] 119 COUNSELVISE.COM (IT) 5306 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 9 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Assessment Year: 2013-2014
• Appeal Filed On: 02-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K TIWARI
• Keywords: Benefit of exemption
• Section: 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G NEW DELHI BEFORE SHRI G.D.AGRAWAL, HONBLE PRESIDENT AND SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER ITA NO.11/DEL/2017 ASSESSMENT YEAR: 2013-14 SANDEEP TANEJA 473, DPS APARTMENTS, PLOT NO. 16, SECTOR-4, DWARKA, DELHI PAN : ABDPT5922C VS. ITO WARD-45(5) NEW DELHI APPELLANT RESPONDENT REVENUE BY : SHRI K. TIWARI, SR. DR ASSESSEE BY : SHRI UMMED KUNTAL, CA DATE OF HEARING : 19.07. 2018 DATE OF PRONOUNCEMENT : 11.10.2018 O R D E R PER SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER : THIS APPEAL IS PREFERRED BY THE ASSESSEE AGAINST T HE ORDER DATED 25.10.2016 PASSED BY THE LD. COMMISSIONER OF INCOME TAX (A)-XV, NEW DELHI FOR ASSESSMENT YEAR 2013-14. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAD FILED HIS RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 9,93 ,000/-. THE TOTAL INCOME INCLUDED CAPITAL GAINS ARISING ON TRAN SFER OF A RESIDENTIAL HOUSE AND CLAIMING EXEMPTION U/S 54 OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED THE ACT) BY WAY OF INVESTMENT ITA NO. 11/DEL/2017 (SANDEEP TANEJA) 2 IN TWO RESIDENTIAL HOUSES. THE ASSESSEE HAD SOLD HI S RESIDENTIAL PROPERTY SITUATED AT GURGAON FOR RS. 1,59,50,000/- WHICH WAS HAVING INDEXED COST OF RS. 12,73,614/- AND THE RESU LTANT LONG TERM CAPITAL GAIN WAS CALCULATED AT RS. 1,46,76,389 /-. THE ASSESSEE MADE INVESTMENT IN PURCHASE OF ONE PROPERT Y AT DWARKA, DELHI FOR RS. 95,46,100/- AND FOR ANOTHER P ROPERTY IN GURGAON FOR RS. 72,22,748/-. HOWEVER, THE ASSESSING OFFICER ALLOWED BENEFIT OF EXEMPTION U/S 54 OF THE ACT ONLY IN RESPECT OF THE RESIDENTIAL HOUSE SITUATED AT DWARKA AND DISALL OWED THE CLAIM IN RESPECT OF THE SECOND FLAT SITUATED AT GUR GAON ON THE GROUND THAT EXEMPTION U/S 54 WAS TO BE ALLOWED WITH RESPECT TO ONE RESIDENTIAL UNIT ONLY. AGGRIEVED, THE ASSESSEE APPROACHED THE LD. CIT (A) WHO ALSO UPHELD THE ACTION OF THE ASSES SING OFFICER. NOW THE ASSESSEE IS IN APPEAL BEFORE THE ITAT AND H AS CHALLENGED THE DENIAL OF EXEMPTION WITH RESPECT TO THE 2 ND RESIDENTIAL UNIT. 3. THE LD. AUTHORISED REPRESENTATIVE SUBMITTED THAT THE INVESTMENT WAS MADE IN BOTH THE PROPERTIES BEFORE T HE FILING OF RETURN OF INCOME ON WHICH THE EXEMPTION HAS BEEN CL AIMED. IT WAS FURTHER SUBMITTED THAT NO EXEMPTION HAS BEEN CL AIMED ON AMOUNTS WHICH WERE PAID AFTER FILING OF RETURN OF I NCOME. IT WAS ALSO SUBMITTED THAT THE ASSESSEE HAD COMPLIED WITH ALL THE ITA NO. 11/DEL/2017 (SANDEEP TANEJA) 3 REQUIREMENTS FOR CLAIMING BENEFIT OF EXEMPTION U/S 54 OF THE INCOME TAX ACT, 1961 AND, THEREFORE, THE BENEFIT OF EXEMPTION SHOULD BE ALLOWED TO THE ASSESSEE. 4. IN RESPONSE, THE LD. DEPARTMENTAL REPRESENTATIVE PLACED EXTENSIVE RELIANCE ON THE FINDINGS OF BOTH THE LOWE R AUTHORITIES. 5. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE PER USED THE RELEVANT MATERIAL ON RECORD. IT IS SEEN THAT THE AS SESSEES CASE IS SQUARELY COVERED BY DECISION OF ITAT DELHI BENCH IN THE CASE OF LAXMAN SINGH RAWAT VS. ACIT IN ITA NO. 1668/DEL/201 3 FOR ASSESSMENT YEAR 2008-09 WHEREIN, VIDE ORDER DATED 2 2.08.2014, THE CO-ORDINATE BENCH HAD ALLOWED THE ASSESSEES CL AIM OF BENEFIT U/S 54 OF THE ACT WITH RESPECT TO PURCHASE OF TWO R ESIDENTIAL PROPERTIES, ONE AT SOLAN AND THE OTHER AT BADDI. TH E ITAT DELHI BENCH, PLACING RELIANCE ON ORDER OF ITAT MUMBAI BEN CH IN THE CASE OF MEHER R. SURTI VS. ITO REPORTED IN [2013] 4 0 TAXMANN.COM 138 (MUMBAI-TRIB.), HAD HELD THAT THE BENEFIT OF EXEMPTION COULD NOT BE RESTRICTED TO ONE HOUSE ONLY . THIS ORDER OF ITAT DELHI BENCH WAS ALSO UPHELD BY THE HONBLE DEL HI HIGH COURT IN ITA NO. 272/2015 VIDE ORDER DATED 7 TH AUGUST, 2015. IT IS NOT IN DISPUTE THAT THE ALLOTMENT WAS MADE TO TH E ASSESSEE IN RESPECT TO THE SECOND RESIDENTIAL HOUSE ALSO. IT IS ALSO NOT IN ITA NO. 11/DEL/2017 (SANDEEP TANEJA) 4 DISPUTE THAT THE ASSESSEE HAD MADE INVESTMENT OF AM OUNT MORE THAN THE ENTIRE CAPITAL GAINS AS CONTEMPLATED U/S 5 4 OF THE INCOME TAX ACT, 1961. ALTHOUGH THE LD. CIT (A) HAS OBSERVED THAT THE ENTIRE PURCHASE CONSIDERATION FOR THE SECOND RE SIDENTIAL PROPERTY WAS NOT PAID BY THE ASSESSEE BEFORE THE FI LING OF RETURN OF INCOME, WE ARE OF THE CONSIDERED OPINION THAT TH E ASSESSEE WILL BE ENTITLED TO CLAIM OF BENEFIT TO THE EXTENT HE HA D MADE PAYMENTS TOWARDS THE SAME WITHIN ONE YEAR FROM THE SALE OF PROPERTY AND THE ASSESSEE HAS CLAIMED ONLY THAT AMO UNT WHICH HAS BEEN PAID WITHIN ONE YEAR FROM THE SALE OF PROP ERTY. THIS FACT IS ALSO EVIDENCED FROM THE ORDER OF LD. CIT (A). AC CORDINGLY, IN VIEW OF THE FACTS OF THE CASE AND THE JUDGMENT OF T HE HONBLE DELHI HIGH COURT IN CASE OF LAXMAN SINGH RAWAT (SUP RA), WE HOLD THAT THE ASSESSEE WILL BE ENTITLED TO THE BENEFIT O F EXEMPTION CLAIMED U/S 54 OF THE ACT IN RESPECT OF THE SECOND RESIDENTIAL PROPERTY ALSO. WE SET ASIDE THE ORDER OF THE LD. CI T (A) AND DIRECT THE AO TO RECOMPUTE THE TAXABLE CAPITAL GAINS AFTER TAKING INTO ACCOUNT THE INVESTMENT MADE IN THE SECOND RESIDENTI AL PROPERTY ALSO AS PER LAW AFTER PROVIDING ADEQUATE OPPORTUNIT Y TO THE ASSESSEE TO PRESENT HIS CASE. ITA NO. 11/DEL/2017 (SANDEEP TANEJA) 5 6. IN THE FINAL RESULT APPEAL OF THE ASSESSEE IS ST ANDS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 11 TH OCTOBER, 2018. SD/- SD/- (G.D.AGRAWAL) (SUDHANSHU SRIV ASTAVA) PRESIDENT JUDICIAL MEMB ER *BR* DATED: 11 TH OCTOBER, 2018 COPY FORWARDED TO: - 1) APPELLANT 2) RESPONDENT 3) CIT(A) 4) CIT 5) DR TRUE COPY BY ORDER ASSTT. REGISTRAR ITA NO. 11/DEL/2017 (SANDEEP TANEJA) 6 DATE OF DICTATION 10.10.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 10.10.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 10.10.2018 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS 10.10.2018 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 11 .10.2018 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 22.10.2018 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 22.10.2018 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER