RAKESH GARG, Jaipur V. ITO, Jaipur

ITA 1100/JPR/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 0547 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-09-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2011-2012
• Appeal Filed On: 13-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J C KULHARI JCIT DHK
• Keywords: Capital asset; Retrospective amendment; Question of law; Assessment record
• Section: 54F; 2(14)

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,OA JH FOE FLAG ;K NO ] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM AND SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA-@ ITA NO. 1100/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2011-12. SHRI RAKESH GARG, 140, JAI JAWAN COLONY, JAIPUR. CUKE VS. THE INCOME TAX OFFICER, WARD 5(4), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AEOPG 1922 P VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI P.C. PARWAL (CA) JKTLO DH VKSJ LS@ REVENUE BY : SHRI J.C. KULHARI (JCIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 29.08.2018. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 13/09/2018. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 24 TH OCTOBER, 2016 OF LD. CIT (A)-2, JAIPUR FOR THE ASSESSMENT YEAR 2011-12. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS :- 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) H AS ERRED ON FACTS AND IN LAW IN DISMISSING THE ASSESSEES GROUN D OF APPEAL THAT THE AGRICULTURAL LAND SOLD BY HIM IS NOT A CAP ITAL ASSET U/S 2(14) OF THE IT ACT, 1961 ON THE GROUND THAT THE AS SESSEE HIMSELF HAS DECLARED CAPITAL GAIN ON SALE OF AGRICU LTURAL LAND IN THE RETURN FILED, NO SUBMISSION HAS BEEN MADE BEFOR E THE AO TO THIS EFFECT AND THAT THIS ISSUE DOES NOT EMANATE FR OM THE ORDER OF THE AO IGNORING THAT THIS BEING A LEGAL GROUND, THE LD. CIT (A) OUGHT TO HAVE DECIDED THE SAME AS PER LAW WHEN ASSE SSEE HAS FILED THE EVIDENCES THAT THE AGRICULTURAL LAND SOLD BY HIM IS NOT A CAPITAL ASSET U/S 2(14) OF THE ACT. 2 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. 2. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED ON FACTS AND IN LAW IN CONFIRMING THE ACTION OF AO IN ALLOWING DEDUCTION U/S 54F OF THE ACT WITH REFERENCE TO INVE STMENT IN ONE CONSTRUCTED RESIDENTIAL PROPERTY ONLY AT RS. 14,67, 670/- AS AGAINST INVESTMENT OF RS. 54,08,560/- IN THREE PROP ERTIES MADE BY THE ASSESSEE. 2.1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS) H AS ERRED ON FACTS AND IN LAW IN INCORRECTLY TAKING THE AMOUNT O F INVESTMENT IN THE SAID PROPERTY AT RS. 14,67,670/- AS AGAINST INVESTMENT OF RS. 19,77,450/- MADE BY THE ASSESSEE, THEREBY REDUC ING THE CLAIM OF DEDUCTION U/S 54F TO RS. 12,05,554/- AS AG AINST RS. 16,24,290/-. 3. THE ASSESSEE CRAVES TO AMEND, ALTER AND MODIFY A NY OF THE GROUNDS OF APPEAL. 4. THE APPROPRIATE COST BE AWARDED TO THE ASSESSEE . GROUND NO. 1 IS REGARDING THE CLAIM OF THE ASSESSEE OF AGRICULTURAL LAND SOLD BY HIM IS NOT A CAPITAL ASSET UNDER SECTI ON 2(14) OF THE IT ACT WAS REJECTED BY THE AUTHORITIES BELOW. 2. THE ASSESSEE IS AN INDIVIDUAL AND DERIVES INCOME FROM JEWELLERY BUSINESS. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE S OLD AGRICULTURAL LAND SITUATED AT BHANKROTA, TEHSIL SANGANER, JAIPUR VIDE SALE DEED D ATED 28 TH APRIL, 2010 WITH HIS TWO BROTHERS FOR A CONSIDERATION OF RS. 1,62,00,000 /-. THUS THE ASSESSEES 1/3 RD SHARE IN THE SALE CONSIDERATION WAS RS. 54,00,000/- . THE ASSESSEE IN ITS RETURN OF INCOME DECLARED INCOME OF RS. 3,05,840/- AFTER CLAI MING DEDUCTION UNDER SECTION 54F OF THE ACT IN RESPECT OF THREE NEW ASSETS PURCH ASED BY THE ASSESSEE AT THREE DIFFERENT LOCATIONS. THE AO ALLOWED THE DEDUCTION U NDER SECTION 54F OF THE ACT ONLY IN RESPECT OF ONE NEW ASSET OF RS. 12,05,554/- AS A GAINST CLAIM OF THE ASSESSEE OF RS. 54,08,560/- THE TOTAL INVESTMENT MADE BY THE AS SESSEE IN THREE SEPARATE 3 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. HOUSING PLOTS. THE ASSESSEE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT (A) AND ALSO RAISED A GROUND THAT THE AGRICULTURAL INCO ME IN QUESTION DOES NOT FALL IN THE DEFINITION OF CAPITAL ASSET AS PER THE PROVISIONS O F SECTION 2(14) OF THE ACT AS THE AGRICULTURAL LAND IN QUESTION IS SITUATED BEYOND 8 KM OF MUNICIPAL LIMITS OF JAIPUR. THE LD. CIT (A) DID NOT ACCEPT THIS OBJECTION OF TH E ASSESSEE AND HELD THAT WHEN THE ASSESSEE HIMSELF HAS DECLARED THE CAPITAL GAIN IN T HE RETURN OF INCOME ARISING FROM SALE OF AGRICULTURAL LAND IN QUESTION AND NO SUBMIS SION WHATSOEVER HAS BEEN MADE BEFORE THE AO TO THIS EFFECT, THEN THIS ISSUE DOES NOT EMANATE FROM THE ORDER OF THE AO. 3. BEFORE US, THE LD. A/R OF THE ASSESSEE HAS SUBMI TTED THAT THE ISSUE WHETHER THE AGRICULTURAL LAND SOLD BY THE ASSESSEE IS A CAP ITAL ASSET OR NOT IS LEGAL IN NATURE WHICH CAN BE RAISED EVEN BEFORE THE APPELLATE AUTHO RITY AND ONCE IT IS RAISED BEFORE THE APPELLATE AUTHORITY, IT OUGHT TO HAVE DECIDED T HIS ISSUE AS PER LAW. IN SUPPORT OF HIS CONTENTION, HE HAS RELIED UPON THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. PRUTHVI BROKERS & SHAREHOLDERS (P) LTD., 349 ITR 336 (BOM.) AND SUBMITTED THAT THE JURISDICTION OF THE APPELLATE AU THORITIES TO CONSIDER A FRESH OR NEW GROUND OR CLAIM IS NOT RESTRICTED TO CASES WHERE SU CH A GROUND DID NOT EXIST WHEN THE RETURN WAS FILED AND THE ASSESSMENT ORDER WAS M ADE. HE HAS ALSO RELIED UPON THE DECISION OF HONBLE GUJARAT HIGH COURT IN CASE OF CIT VS. MITESH IMPEX & ORS., 104 DTR 169 (GUJ.) AND SUBMITTED THAT THE HONBLE H IGH COURT HAS HELD THAT ANY GROUND, LEGAL CONTENTION OR EVEN A CLAIM WOULD BE P ERMISSIBLE TO BE RAISED FOR THE FIRST TIME BEFORE THE APPELLATE AUTHORITY WHEN THE FACTS NECESSARY TO EXAMINE SUCH GROUND, CONTENTION OR CLAIM ARE ALREADY ON RECORD. THE LD. A/R HAS ALSO RELIED UPON THE THIRD MEMBER DECISION OF JABALPUR BENCH OF THE TRIBUNAL IN CASE OF DCIT VS. 4 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. VISHWANATH PRASAD GUPTA, 57 DTR 89. HENCE, THE LD. A/R HAS SUBMITTED THAT THE LD. CIT (A) OUGHT TO HAVE DECIDED THE ISSUE RAISED BY T HE ASSESSEE INSTEAD OF REJECTING THE SAME WITHOUT ENTERTAINING. 4. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THA T THIS IS NOT A QUESTION WHICH CAN BE DECIDED ON THE BASIS OF THE FACTS AND MATERI AL ON RECORD BUT A PROPER INVESTIGATION AND ENQUIRY IS REQUIRED REGARDING THE FACT WHETHER THE LAND IS SITUATED BEYOND THE 8 KM LIMITS FROM THE JAIPUR MUNICIPALITY OR WITHIN 8 KM OF THE MUNICIPAL LIMITS. THUS THE ISSUE REQUIRES CONSIDERATION OF T HE FACT TO BE ASCERTAINED THROUGH CONDUCT OF ENQUIRY AND, THEREFORE, THE CASE OF THE ASSESSEE DOES NOT FALL IN THE CATEGORY OF A LEGAL ISSUE WHICH CAN BE DECIDED ON T HE BASIS OF THE FACTS AND MATERIAL ALREADY AVAILABLE ON THE ASSESSMENT RECORD. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. THE ISSUE RAISED BY THE ASSESSEE WHETHER T HE AGRICULTURAL LAND IN QUESTION IS CAPITAL ASSET OR NOT INVOLVES BOTH FACTUAL AS WELL AS LEGAL QUESTION. WHETHER THE LAND SITUATED IN ANY AREA WITHIN THE DISTANCE NOT MORE T HAN 8 KM FROM THE LOCAL LIMITS OF JAIPUR MUNICIPALITY OR IN THE AREA BEYOND 8 KM FROM THE LOCAL LIMITS OF MUNICIPALITY IS A QUESTION OF FACT AND ONLY ONCE THIS QUESTION OF F ACT IS DECIDED THEN THE QUESTION OF LAW COMES INTO PLAY. THERE IS NO DISPUTE THAT THE ASSESSEE HIMSELF HAS DECLARED THE CAPITAL GAIN ARISING FROM THE SALE OF AGRICULTURAL LAND IN QUESTION AND CLAIMED DEDUCTION UNDER SECTION 54F OF THE ACT. HOWEVER, B EFORE THE LD. CIT (A) THE ASSESSEE RAISED THIS ISSUE OF NOT CHARGEABLE TO CAP ITAL GAIN DUE TO THE REASON THAT THE LAND IN QUESTION SITUATED IN THE AREA WHICH IS BEYOND 8 KM FROM THE LOCAL LIMITS OF JAIPUR MUNICIPALITY. THUS FOR CONSIDERING THE ISSUE WHETHER THE AGRICULTURAL LAND IN QUESTION SITUATED IN THE AREA WHICH IS BEYOND 8 KM FROM THE LOCAL LIMITS, A PROPER 5 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. ENQUIRY AND INVESTIGATION IS REQUIRED. THE ASSESSE E FILED CERTAIN DOCUMENTS IN SUPPORT OF THE CLAIM BEFORE THE LD. CIT (A). HOWEV ER, THERE WAS NO FURTHER VERIFICATION AND ENQUIRY CONDUCTED BY ANY AUTHORITY AS THE LD. CIT (A) REJECTED THE CLAIM OF THE ASSESSEE AS NOT MAINTAINABLE ON THE GR OUND THAT THE SAME WAS NOT RAISED BEFORE THE AO. WE FIND THAT THOUGH THE ISSU E RAISED BY THE ASSESSEE INVOLVES QUESTION OF FACT AS WELL AS LAW, HOWEVER, THE LD. C IT (A) HAVING THE COTERMINOUS POWER AS THAT OF ASSESSING OFFICER, COULD HAVE VERI FIED THE FACTS BY CALLING A REMAND REPORT FROM THE AO AND, THEREFORE, THE ISSUE COULD HAVE BEEN DECIDED ON MERITS. FURTHER, WE FIND THAT THE DOCUMENTS PRODUCED BY THE ASSESSEE ARE NOT SUFFICIENT TO ADJUDICATE THE ISSUE AS THE ASSESSEE HAS FILED ONLY A GOOGLE MAP AS WELL AS CERTAIN REPORTS OF THE MUNICIPAL CORPORATION WHICH ARE NOT DIRECTLY ON THE POINT OF DISTANCE. FURTHER, THE ASSESSEE HAS CLAIMED THE DISTANCE OF P ARTICULAR LAND FROM THE MUNICIPAL LIMITS WHEREAS AS PER THE PROVISIONS OF SECTION 2(1 4)(III)(B) OF THE ACT THE DISTANCE HAS TO BE MEASURED FROM THE MUNICIPAL LIMITS AND TH E AREA IN WHICH THE AGRICULTURAL LAND SITUATE. FOR READY REFERENCE, WE QUOTE THE P ROVISIONS OF SECTION 2(14)(III)(B) WITH EXPLANATION AS UNDER :- 2 (14) [ CAPITAL ASSET MEANS - (III) AGRICULTURAL LAND IN INDIA, NOT BEING LAND SITUATE (A) XXXXX (B) IN ANY AREA WITHIN THE DISTANCE, MEASURED AERI ALLY, - ( I ) NOT BEING MORE THAN TWO KILOMETRES, FROM THE LOCAL LIMITS OF ANY MUNICIPALITY OR CANTONMENT BOARD REFERRED TO IN ITEM ( A ) AND WHICH HAS A POPULATION OF MORE THAN TEN THOUSAN D BUT NOT EXCEEDING ONE LAKH; OR 6 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. ( II ) NOT BEING MORE THAN SIX KILOMETRES, FROM THE LOCAL LIMITS OF ANY MUNICIPALITY OR CANTONMENT BOARD REFERRED TO IN ITEM ( A ) AND WHICH HAS A POPULATION OF MORE THAN ONE LAKH BU T NOT EXCEEDING TEN LAKH; OR ( III ) NOT BEING MORE THAN EIGHT KILOMETRES, FROM THE LOCA L LIMITS OF ANY MUNICIPALITY OR CANTONMENT BOARD REFERRED TO IN ITEM ( A ) AND WHICH HAS A POPULATION OF MORE THAN TEN LAKH. EXPLANATION. FOR THE PURPOSES OF THIS SUB - CLAUSE, 'POPULATION' MEANS THE POPULATION ACCORDING TO THE LAST PRECEDING CENSUS O F WHICH THE RELEVANT FIGURES HAVE BEEN PUBLISHED BEFORE THE FIR ST DAY OF THE PREVIOUS YEAR;]] THUS IT IS CLEAR FROM THE CLAUSE (III) AND SUB-CLAU SE (B) OF SECTION 2(14) OF THE ACT THAT THE AGRICULTURAL LAND WILL BE EXCLUDED FROM TH E DEFINITION OF CAPITAL ASSET IF THE SAME IS SITUATED IN AN AREA WHICH IS BEYOND 8 KM FR OM THE LOCAL LIMITS OF THE MUNICIPAL/CANTONMENT BOARD. THEREFORE, FOR DETERMIN ING THE ISSUE OF THE LAND IN QUESTION IS NOT FALLING IN THE DEFINITION OF CAPITA L ASSET BUT FALLING IN THE EXCLUSION CLAUSE OF SECTION 2(14) OF THE ACT, THE DISTANCE FR OM THE MUNICIPAL LIMITS TO THE AREA IN WHICH THE LAND IS SITUATED IS TO BE TAKEN INTO C ONSIDERATION. IT IS PERTINENT TO NOTE THAT THE PHRASE AGRICULTURAL LAND NOT BEING LAND SITUATE IN ANY AREA WITHIN THE DISTANCE IS PURPOSEFULLY USED IN THIS PROVISION TO AVOID THE CONFUSION AND A SITUATION WHERE ONE PART OF A LAND CAN FALL WITHIN THE DISTAN CE OF 8 KM AND ANOTHER PART CAN BE BEYOND 8 KM AND, THEREFORE, IN CASE WHEN THE ASS ESSEE IS SELLING THE LAND BY DIVISION IN DIFFERENT PARTS, THEN ONE PART OF THE L AND WILL BE EXCLUDED FROM THE DEFINITION OF CAPITAL ASSET AND OTHER PART OF THE S AME LAND WILL BE TREATED AS CAPITAL ASSET. THEREFORE, INSTEAD OF A PARTICULAR LAND, TH E DISTANCE FROM THE MUNICIPAL LIMIT TO THE AREA IN WHICH THE LAND IS SITUATED IS TO BE TAKEN INTO CONSIDERATION. ACCORDINGLY, WE FIND THAT THE ISSUE RAISED BY THE A SSESSEE REQUIRES A PROPER 7 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. INVESTIGATION OF FACTS AND ALSO DETERMINATION OF TH E FACT WHETHER THE PARTICULAR LAND IS SITUATED IN THE AREA WHICH IS BEYOND 8 KM FROM T HE MUNICIPAL LIMITS. HENCE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN THE INTE REST OF JUSTICE, WE SET ASIDE THIS ISSUE TO THE RECORD OF THE AO FOR PROPER VERIFICATI ON AND GIVING THE FINDING ABOUT THE DISTANCE FROM THE MUNICIPAL LIMITS TO THE AREA IN W HICH THE LAND IS SITUATED. WE MAY CLARIFY THAT THE TERMS USED IN THE PROVISION REFERS TO THE PARTICULAR REVENUE STATE IN WHICH THE AGRICULTURAL LAND IS SITUATED AND, THEREF ORE, THE DISTANCE FROM THE MUNICIPAL LIMIT TO THE PARTICULARLY REVENUE STATE H AS TO BE CONSIDERED FOR THE PURPOSES OF DECIDING THE ISSUE. GROUND NO. 2 IS REGARDING RESTRICTING THE DEDUCTION UNDER SECTION 54F IN RESPECT OF ONLY ONE RESIDENTIAL PROPERTY AS AGAINST THREE CLAIMED BY THE ASSESSEE. 6. THE ASSESSEE CLAIMED A DEDUCTION OF RS. 54,08,56 0/- FOR INVESTMENT MADE IN THREE PROPERTIES. THE DETAILS OF THE PROPERTIES HA VE BEEN GIVEN BY THE AO IN PARA 3.1 AS UNDER :- (I) CONSTRUCTED HOUSE, PLOT NO. 79, VIVEK VIHAR, JAGATPURA, JAIPUR DATED 20.7.2011 RS. 14,67,670/- (I) RESIDENTIAL PLOT 160, ORIENTAL ARCADE YOJNA MAHAL , JAGATPURA, JAIPUR DATED 14.3.2011 RS. 15,74,340/-. (II) RESIDENTIAL PLOT C-285, SIDARTH NAGAR YOJNA, NEAR JAWAHAR CIRCLE JAIPUR DATED 14.3.2011 RS. 15,73,770/- THE TOTAL INVESTMENT OF RS. 54,08,560/- HAS BEEN SH OWN WHEREAS AS PER DOCUMENTS THE TOTAL INVESTMENT MADE BY THE ASSE SSEE COME TO RS. 46,15,780/-. THE ASSESSEE VIDE HIS LETTER DATED 17. 12.2013 STATED THAT THE DEDUCTION UNDER SEC. 54F HAS BEEN CLAIMED WRONG LY INSTEAD OF 54 8 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. OF THE I.T. ACT, 1961 DUE TO IGNORANCE ABOUT THE NA TURE OF DEDUCTIONS AS PERMISSIBLE U/S 54 AND 54F OF THE ACT. THE AO ALLOWED THE CLAIM OF THE ASSESSEE ONLY IN RE SPECT OF ONE RESIDENTIAL CONSTRUCTED HOUSE I.E. AT SL. NO. 1 OF THE ABOVE DE TAILS AND REJECTED THE CLAIM IN RESPECT OF OTHER TWO RESIDENTIAL PLOTS. THE ASSESS EE CHALLENGED THE ACTION OF THE AO BEFORE THE LD. CIT (A). HOWEVER, THE LD. CIT (A) H AS UPHELD THE ORDER OF THE AO. 7. BEFORE US, THE LD. A/R OF THE ASSESSEE HAS SUBMI TTED THAT PRIOR TO THE AMENDMENT WITH EFFECT FROM 01.04.2015 A RESIDENTIAL HOUSE WAS CONSIDERED AS MORE THAN ONE HOUSE IF THE SAME CONSTITUTE A SINGLE DWEL LING HOUSE AS PER THE NEEDS OF THE FAMILY MEMBERS OF THE ASSESSEE. FURTHER, THE R ESIDENTIAL HOUSE CONSISTS OF SEVERAL INDEPENDENT UNITS CANNOT BE TAKEN AS AN IMP EDIMENT TO ALLOW THE EXEMPTION UNDER SECTION 54F OF THE ACT. HENCE, THE LD. A/R H AS SUBMITTED THAT IN VIEW OF THE VARIOUS DECISIONS ON THIS ISSUE, MORE THAN ONE INDE PENDENT UNIT CAN BE CONSIDERED AS A RESIDENTIAL HOUSE IN TERMS OF SECTION 54F OF T HE ACT. THUS THE INVESTMENT MADE BY THE ASSESSEE IN DIFFERENT UNITS IS ELIGIBLE FOR DEDUCTION UNDER SECTION 54F OF THE ACT. IN SUPPORT OF HIS CONTENTION HE HAS RELIED UP ON THE JUDGMENT OF HONBLE SUPREME COURT IN THE CASE OF CIT VS. VATIKA TOWNSHI P PVT. LTD., 367 ITR 466 (SC) AND SUBMITTED THAT THE HONBLE SUPREME COURT HAS HE LD THAT LEGISLATIONS WHICH MODIFY ACCRUED RIGHTS OR WHICH IMPOSE OBLIGATIONS O R IMPOSE NEW DUTIES OR ATTACH A NEW DISABILITY HAVE TO BE TREATED AS PROSPECTIVE UN LESS THE LEGISLATIVE INTENT IS CLEARLY TO GIVE THE ENACTMENT A RETROSPECTIVE EFFECT. THUS THE LD. A/R HAS SUBMITTED THAT THE AMENDMENT IN THE PROVISION WHEREBY IT HAS BEEN SPECIFIED ONE RESIDENTIAL HOUSE IN INDIA IS TREATED AS PROSPECTIVE. AS REGARDS TH E TERM A RESIDENTIAL HOUSE DEFINED 9 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. AND INTERPRETED BY THE VARIOUS DECISIONS, THE LD. A /R HAS RELIED UPON THE FOLLOWING DECISIONS :- GITA DUGGAL VS. CIT 357 ITR 153 (DELHI) D. ANAND BASAPPA VS. ITO 309 ITR 329 (KAR.) AND SUBMITTED THAT THE HONBLE HIGH COURT HAVE HELD THAT THE PHRASE A RESIDENTIAL HOUSE WOULD MEAN ONE RESIDENTIAL HOUSE DOES NOT AP PEAR TO BE CORRECT UNDERSTANDING. A RESIDENTIAL HOUSE SHOULD BE UNDERS TOOD IN A SENSE THAT BUILDING SHOULD BE OF RESIDENTIAL IN NATURE AND IT SHOULD NO T BE UNDERSTOOD TO INDICATE A SINGLE NUMBER. 8. ON THE OTHER HAND, THE LD. D/R HAS SUBMITTED THA T THERE IS NO DISPUTE THAT THE ASSESSEE HAS INVESTED IN THREE DIFFERENT PROPERTIES AND ONLY ONE WAS A CONSTRUCTED HOUSE AND TWO OTHERS ARE ONLY THE RESIDENTIAL PLOTS AND, THEREFORE, ARE NOT FALLING IN THE DEFINITION OF RESIDENTIAL HOUSE. FURTHER, THE THREE PROPERTIES IN WHICH THE ASSESSEE INVESTED ARE SITUATED IN DIFFERENT PARTS O F THE CITY AND CANNOT BE CONSIDERED AS A SINGLE RESIDENTIAL HOUSE. HE HAS RELIED UPON T HE ORDERS OF THE AUTHORITIES BELOW. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS THE RELEVANT MATERIAL ON RECORD. AS PER THE DETAILS OF THE THREE PROPERTIES IN WHICH THE ASSESSEE HAS CLAIMED TO HAVE INVESTED SALE CONSIDERATION OF THE LAND IN QUESTION, ONLY ONE PROPERTY I.E. AT SL. NO. 1 OF THE LIST REPRODUCED IN PARA 6 ABOVE IS A CONSTRUCTED HOUSE AND TWO OTHERS ARE ONLY THE PLOTS OF LAND. FURTHER, AS IT I S EVIDENT FROM THE DETAILS THAT THESE THREE PROPERTIES ARE SITUATED IN DIFFERENT PARTS OF THE JAIPUR CITY AND ARE NOT ADJOINING TO EACH OTHER. THEREFORE, EVEN OTHERWISE ALL THREE RESIDENTIAL PLOTS CANNOT BE USED AS A SINGLE RESIDENTIAL HOUSE AS THESE ARE NOT CONTIGUOUS OR CAN BE 10 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. CONVENIENTLY USED BY TREATING THE SINGLE RESIDENTIA L HOUSE AS PER THE NEEDS OF THE ASSESSEE. EVEN OTHERWISE, ASSESSEE HAS NOT CLAIMED THAT SEPARATE PROPERTIES WERE PURCHASED AS PER THE REQUIREMENT OF THE FAMILY AS T HE ASSESSEE HAS CONSTRUCTED ONLY ONE STRUCTURE OF A HOUSE AND THE OTHER TWO PROPERTI ES ARE ONLY THE PLOTS OF LAND. THOUGH THE ASSESSEE HAS ERECTED A BOUNDARY WALL ON ONE OF THE PLOTS BUT THE SAME WOULD NOT CONSTITUTE THE CONSTRUCTION OF A HOUSE. THEREFORE, WHEN THESE THREE SEPARATE PROPERTIES CANNOT BE REGARDED AS A SINGLE RESIDENTIAL HOUSE IN VIEW OF THEIR LOCATIONS AT DIFFERENT PARTS OF THE CITY AND TWO OF WHICH ARE ONLY THE PLOTS OF LAND, THEREFORE, THE DECISIONS RELIED UPON BY THE ASSESSE E WILL NOT HELP THE CASE OF THE ASSESSEE SO FAR AS THE TREATMENT OF THREE DIFFERENT PROPERTIES AS A SINGLE RESIDENTIAL HOUSE. THE LD. CIT (A) HAS CONSIDERED THIS ISSUE I N PARA 3.3 AS UNDER :- 3.3. I HAVE PERUSED THE FACTS OF THE CASE, THE AS SESSMENT ORDER AND THE SUBMISSIONS OF THE APPELLANT. AS REGARDS INVEST MENTS MADE UNDER SECTION 54F OF THE I.T. ACT, 1961 THE ASSESSEE HAS GIVEN A LIST OF THREE PROPERTIES IN THREE DIFFERENT AREAS OF JAIPUR. THE ASSESSING OFFICER HELD THAT THE DEDUCTION WAS ADMISSIBLE ON ONE RESIDENTIA L HOUSE AND RESTRICTED THE SAME TO THE PROPERTY AT PLOT NO. 79, VIVEK VIHAR, JAGATPURA SINCE IT WAS THE ONLY CONSTRUCTED HOUSE A ND THE OTHER TWO PROPERTIES WERE ONLY PLOTS. FURTHER THE AUTHORIZED REPRESENTATIVE PLACED RELIANCE ON A NUMBER OF JUDGMENTS BUT THE SA ME ARE DISTINGUISHABLE BECAUSE IN ALL THOSE CASES THE ASSE T PURCHASED WAS A CONSTRUCTED RESIDENTIAL HOUSE AND THE ISSUE WAS REG ARDING WHETHER TWO OR MORE UNITS IN THE SAME COMPLEX COULD BE CONSIDER ED FOR THE DEDUCTION. IN THE ASSESSEES CASE THERE IS ONLY ON E CONSTRUCTED HOUSE AND THE OTHER TWO ARE PLOTS AND THAT TWO IN DIFFERE NT AREAS, THEREFORE, THE DEDUCTION HAS BEEN CORRECTLY ARRIVED AT BY THE ASSESSING OFFICER. ASSESSING OFFICER HAS PLACED RELIANCE ON THE DECISI ON OF HONBLE PUNJAB 11 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. & HARYANA HIGH COURT IN THE CASE OF PAWAN ARYA VS. CIT 2011-ITOL- 01-HC-P&T IT. THIS GROUND OF APPEAL IS DISMISSED. THUS THE LD. CIT (A) HAS FOLLOWED THE DECISION OF H ONBLE PUNJAB & HARYANA HIGH COURT IN CASE OF PAWAN ARYA VS. CIT (SUPRA) WHICH I S DIRECTLY ON THE ISSUE. FURTHER, THE INCENTIVE FOR GRANTING THE DEDUCTION UNDER SECT ION 54F OF THE ACT IS FOR INVESTMENT IN THE RESIDENTIAL HOUSE OF THE ASSESSEE WHICH MEANS THAT THE INVESTMENT IS MADE FOR OWN RESIDENTIAL REQUIREMENT OF THE ASSE SSEE AND NOT FUTURE INVESTMENT IN THE PROPERTY. THEREFORE, IN THE ABSENCE OF ANY MATERIAL TO SHOW THAT THE THREE DIFFERENT PROPERTIES WERE PURCHASED TO MEET THE RES IDENTIAL REQUIREMENT OF THE FAMILY OF THE ASSESSEE, THE CLAIM OF THE ASSESSEE C ANNOT BE ACCEPTED. IT IS AGAINST THE SCHEME AND OBJECT OF THE SECTION 54F OF THE ACT WHICH PROVIDES THE DEDUCTION IN RESPECT OF THE INVESTMENT MADE FOR PURCHASE OF RESI DENTIAL HOUSE FOR ASSESSEES OWN REQUIREMENT. IN VIEW OF THE ABOVE FACTS AND CIRCUM STANCES OF THE CASE, WE DO NOT FIND ANY ERROR OR ILLEGALITY IN THE ORDERS OF THE A UTHORITIES BELOW, QUA THIS ISSUE. 10. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER IS PRONOUNCED IN THE OPEN COURT ON 13/09/ 2018. SD/- SD/- ( FOE FLAG ;KNO ) ( FOT; IKY JKWO (VIKRAM SINGH YADAV ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 13/09/2018. DAS/ 12 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR. VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT- SHRI RAKESH GARG, JAIPUR. 2. THE RESPONDENT THE ITO WARD 5(4), JAIPUR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (ITA NO. 1100/JP/2016) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR 13 ITA NO. 1100/JP/2016 SHRI RAKESH GARG, JAIPUR.