Sri Ganta Vijaya Lakshmi, Visakhapatnam V. THE DCIT, Central Circle-1, Visakhapatnam., Visakhapatnam

ITA 253/VIZ/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 67389 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 1 year(s) 1 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-07-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Next Hearing Date: 01-05-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 14-06-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K V N CHARYA
• Assessee Lawyers: C SUBRAHMAYNAM
• Keywords: Capital asset
• Section: 54B; 54F; 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE S/SHRI D.MANMOHAN, V.P AND B.R.BASKARAN , AM I.T.A NO. 253/VIZ/2012 ASST YEAR 2008-09 GANTA VIJAYA LAKSHMI 1-7 PEDAPULIPAKA PENAMALURU MANDAL KRISHNA DIST VS. THE INCOME TAX OFFICER WARD 1(3) VIJAYAWADA (ASSESSEE-APPELLANT) PAN NO. ASYPG8052E (REVENUE- RESPONDENT) ASSESSEE BY SHRI C SUBRAHMAYNAM, CA REVENUE BY SHRI K.V.N CHARYA, CIT-DR DATE OF HEARING 01-05-13 DATE OF PRONOUNCEMENT 22/07/2013 O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: THE APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 30-03-2012 PASSED BY LD CIT(A), VIJAYAWADA AND IT RELATES TO THE ASSE SSMENT YEAR 2008-09. 2. THE SOLITARY ISSUE URGED IN THIS APPEAL IS W HETHER THE LD CIT(A) IS JUSTIFIED IN HOLDING THAT THE ASSESSEE IS NOT ENTITLED TO CLAIM DEDUCTION U/S 54B AND 54F OF THE ACT IN RESPECT OF INVESTMENTS MADE IN THE NAME OF HER D AUGHTERS. 3. THE FACTS RELATING TO THE ISSUE ARE SET OUT IN BRIEF. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE SOLD 2 ACRES AND 50 CEN TS OF WET AGRICULTURAL LAND LOCATED AT PEDA PULIPAKA VILLAGE FOR A CONSIDERATION OF RS.1,4 1,12,000/-. THERE IS NO DISPUTE THAT THE CAPITAL GAIN ARISING ON SALE OF THE ABOVE SAID AGRICULTURAL LAND IS ASSESSABLE TO INCOME TAX. THEREAFTER THE ASSESSEE PURCHASED FOLL OWING TWO PROPERTIES IN THE NAME OF HER DAUGHTERS. I.T.A. NO.253/VIZ/2012 2 (A) A WET AGRICULTURAL LAND HAVING AN EXTENT OF 3 ACRES AND 94 CENTS IN KOLAVENNU VILLAGE WAS PURCHASED IN THE NAME OF HIS YOUNGER DAUGHTER NAMED SMT. SODISETTY SWAPNA FOR A CONSIDERATION OF RS.52. 00 LAKHS. (B) ONE FLAT AT GOCHIBOWLI VILLAGE, SERILINGAMPALL I MANDAL, RANGA REDDY DISTRICT WAS PURCHASED IN THE NAME OF HER ELDEST DAUGHTER NA MED SMT. KAPA SUBHASHINI FOR A CONSIDERATION OF RS.58.00 LAKHS. WHILE COMPUTING LONG TERM CAPITAL GAIN ON SALE OF A GRICULTURAL LAND LOCATED AT PEDA PULIPAKA VILLAGE, THE ASSESSEE CLAIMED DEDUCTION U/ S 54B OF THE ACT IN RESPECT OF THE AGRICULTURAL LAND PURCHASED IN THE NAME OF HER YOUN GER DAUGHTER AND ALSO CLAIMED DEDUCTION U/S 54F OF THE ACT IN RESPECT OF THE FLAT PURCHASED IN THE NAME OF HER ELDEST DAUGHTER. THE ASSESSEE CLAIMED THOSE DEDUCTIONS ON THE PLEA THAT THE CONSIDERATION FOR PURCHASE OF BOTH THE PROPERTIES WERE GIVEN BY H ER OUT OF SALE PROCEEDS REALIZED ON SALE OF AGRICULTURAL LAND. THE ASSESSEE FURTHER SU BMITTED THAT SHE HAS ENTERED INTO POSSESSION PURCHASE AGREEMENTS WITH HER TWO DAUGH TERS TO COMPLY WITH THE PROVISIONS OF SEC. 54B AND 54F OF THE ACT. IT WAS FURTHER CONTENDED BY THE ASSESSEE THAT HER DAUGHTERS SHOULD BE CONSIDERED AS HER BENA MIS. 4. THE ASSESSING OFFICER HELD THAT THE DEDUCTIO N CLAIMED U/S 54B AND 54F ARE NOT ALLOWABLE AS THE PROPERTIES WERE NOT REGISTERED IN THE NAME OF THE ASSESSEE. THE CLAIM OF BENAMI WAS ALSO REJECTED BY THE AO ON THE GROU ND THAT THE BENAMI TRANSACTIONS PROHIBITION ACT PROVIDES EXEMPTION TO PROPERTY PURC HASED IN THE NAME OF UNMARRIED DAUGHTERS ONLY. THE AO ALSO REFUSED TO RECOGNIZE B OTH THE POSSESSION PURCHASE AGREEMENT AS THEY WERE UNREGISTERED DOCUMENT AND THE THEY DO NOT ACTUALLY TRANSFER THE PROPERTIES. ACCORDINGLY, THE AO REJECTED THE D EDUCTIONS CLAIMED BY THE ASSESSEE U/S 54B AND 54F OF THE ACT. 5. THE ASSESSEE CARRIED THE MATTERS IN APPEAL FIL ED BEFORE LD CIT(A). THE ASSESSEE CLAIMED BEFORE HIM THAT THE POSSESSION PURCHASE AG REEMENT GIVES HER RIGHT TO THE POSSESSION OF THE PROPERTIES IN TERMS OF SEC. 2(47) (V) OF THE ACT. SHE FURTHER SUBMITTED THAT THE CONSIDERATION FOR PURCHASE OF PROPERTIES I N THE NAME OF HER DAUGHTERS HAVE FLOWN FROM HER. ACCORDINGLY, THE ASSESSEE CONTENDE D THAT SHE HAS COMPLIED WITH THE SPIRIT OF PROVISIONS OF SEC. 54B AND 54F OF THE ACT AND HENCE HER CLAIM SHOULD BE I.T.A. NO.253/VIZ/2012 3 ALLOWED. THE FIRST APPELLATE AUTHORITY, HOWEVER, H ELD THAT THE POSSESSION PURCHASE AGREEMENT ENTERED INTO BETWEEN THE ASSESSEE AND HE R DAUGHTERS DO NOT CONVEY ANY TITLE TO THE ASSESSEE. IN THIS REGARD, THE LD CIT (A) PLACED RELIANCE ON THE DECISION OF HONBLE SUPREME COURT IN THE CASE OF SURAJ LAMP & I NDUSTRIES PVT. LTD VS. STATE OF HARYANA & ANOTHER IN SLP (C) NO.13917 OF 2009 AND H E HAS EXTRACTED THE FOLLOWING OBSERVATIONS MADE BY THE HONBLE APEX COURT IN THE ABOVE SAID CASE. 16 WE THEREFORE REITERATE THAT IMMOVABLE PROP ERTY CAN BE LEGALLY AND LAWFULLY TRANSFERRED / CONVEYED ONLY BY A REGISTERE D DEED OF CONVEYANCE. TRANSACTIONS OF THE NATURE OF GPA SALES OR SA/GA P/WILL TRANSFERS DO NOT CONVEY TITLE AND DO NOT AMOUNT TO TRANSFER, NOR CAN THEY BE RECOGNIZED OR VALID MODE OF TRANSFER OF IMMOVABLE PROPERTY. THE COURTS WILL NOT TREAT SUCH TRANSACTIONS AS COMPLETED OR CONCLUDED TRANSFERS OR AS CONVEYANCES AS THEY NEITHER CONVEY TITLE NOR CREATE ANY INTEREST IN AN IMMOVABLE PROPERTY. BEFORE LD CIT(A), THE ASSESSEE PLACED RELIANCE ON T HE FOLLOWING CASE LAW TO SUPPORT HER CLAIM FOR DEDUCTION U/S 54B AND 54F IN RESPECT OF P ROPERTIES PURCHASED IN THE NAME OF HER DAUGHTERS. (A) CIT VS. GURNAM SINGH (327 ITR 278)(2010)(P&H) (B) CIT VS. NATARAJAN (287 ITR 271)(MAD) (C) DEPUTY DIRECTOR OF INCOME TAX (INTL. TAXATION) VS. JENNIFER BHIDE, ITA NO.169 OF 2011 DAATED 26 TH SEPTMBER, 2011 (KARNATAKA) (D) CIT VS. RAVINDER KUMAR ARORA (DELHI) ITA NO.1106 OF 2011 DATED 17 TH SEPT, 2011. (E) K.G.VYAS VS. SEVENTH INCOME TAX OFFICER, 26 TTJ 491 (BOM)(1986) IN THE CASES OF (A), (C), (D) AND (E), REFERRED ABO VE, THE LD CIT(A) NOTICED THAT THE ASSESSEES THEREIN HAD PURCHASED THE ELIGIBLE PROPE RTY IN JOINT NAMES, I.E., IN THEIR NAME AND IN THE NAME OF RELATIVES. IN THE CASE OF (B) R EFERRED ABOVE, THE PROPERTY WAS PURCHASED IN THE NAME OF WIFE OF THE ASSESSEE. HEN CE THE LD CIT(A) HELD THAT THE ASSESSEE COULD NOT PLACE RELIANCE ON THE ABOVE SAID CASE LAWS. ACCORDINGLY, HE AFFIRMED THE ORDER PASSED BY THE ASSESSING OFFICER. AGGRIEV ED, THE ASSESSEE HAS FILED THIS APPEAL BEFORE US. 6. THE LD COUNSEL FOR THE ASSESSEE PLACED RELIA NCE ON THE DECISION OF HONBLE JURISDICTIONAL ANDHRA PRADESH HIGH COURT IN THE CAS E OF LATE MIR GULAM ALI KHAN VS. CIT (1987)(165 ITR 228) AND SUBMITTED THAT THE JURISDIC TIONAL HIGH COURT IN THE ABOVE SAID I.T.A. NO.253/VIZ/2012 4 CASE HAS HELD THAT THE WORD ASSESSEE SHOULD BE GI VEN A WIDE AND LIBERAL INTERPRETATION SO AS TO INCLUDE LEGAL REPRESENTATIVES ALSO. EXPLAIN ING THE FACTS PREVAILING IN THE CASE OF LATE MIR GULAM ALI KHAN (SUPRA), THE LD A.R SUBMITT ED THAT THE ASSESSEE, IN THE ABOVE SAID CASE, SOLD A RESIDENTIAL HOUSE AND THEREAFTER ENTERED INTO AN AGREEMENT TO PURCHASE ANOTHER HOUSE. BEFORE COMPLETING THE PURC HASE TRANSACTION, THE ASSESSEE DIED AND SUBSEQUENTLY HIS LEGAL HEIRS COMPLETED THE SAID TRANSACTION. THE LEGAL HEIRS CLAIMED DEDUCTION U/S 54 OF THE ACT, WHICH WAS REJE CTED BY THE ITO. THE JURISDICTIONAL HIGH COURT ALLOWED THE CLAIM OF THE ASSESSEE. THE LD A.R INVITED OUR ATTENTION TO THE FOLLOWING OBSERVATIONS MADE BY THE HONBLE JURISDIC TIONAL HIGH COURT.:- RELYING UPON THE EXPRESSION ASSESSEE OCCURRING I N S. 54 OF THE ACT, IT IS CONTENDED FOR THE DEPARTMENT THAT IN ORDER TO CLAIM THE EXEMPTION, THE PERSON WHO SOLD THE HOUSE MUST BE THE SAME AS THE PERSON W HO PURCHASED THE HOUSE, THAT IS, THE ASSESSEE MUST BE ONE AND THE SAME PERS ON. THE IDENTITY MUST BE THE SAME. WE ARE UNABLE TO ACCEPT THIS CONTENTION. THE OBJECT OF GRANTING EXEMPTION UNDER S. 54 OF THE ACT IS THAT A PERSON W HO SELLS A RESIDENTIAL HOUSE FOR THE PURPOSE OF PURCHASING ANOTHER CONVENIENT HO USE MUST BE GIVEN EXEMPTION SO FAR AS CAPITAL GAINS ARE CONCERNED. A S LONG AS THE SALE OF HOUSE AND PURCHASE OF ANOTHER HOUSE ARE PART OF THE SAME SCHEME, THE LAPSE OF SOME TIME BETWEEN THE SALE AND PURCHASE MAKES NO DIFFERE NCE. THE WORD ASSESSEE 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 GR ANTING THE EXEMPTION AND WHAT IS MORE, IN THE INSTANT CASE, THE VERY SAME AS SESSEE IMMEDIATELY AFTER THE SALE OF THE HOUSE, ENTERED INTO AN AGREEMENT FOR PU RCHASING ANOTHER HOUSE AND PAID A SUM OF RS.1,000 AS EARNEST MONEY AND SUBSEQU ENTLY THE LEGAL REPRESENTATIVE COMPLETED THE TRANSACTION WITHIN THE PERIOD OF ONE YEAR FROM THE DATE OF THE DEATH OF THE DECEASED. THE SALE AND PU RCHASE ARE TWO LINKS IN THE SAME CHAIN. WE ARE FORTIFIED IN THIS VIEW BY A DEC ISION OF THE MADRAS HIGH COURT IN C.V.RAMANATHAN VS. CIT (1980) 17 CTR (MAD) 322 : (1980) 125 ITR 191 (MAD) : TC22R.230. THE LD COUNSEL FURTHER SUBMITTED THAT THE DECISION OF THE JURISDICTIONAL HIGH COURT IS BINDING ON THE TRIBUNAL AND IN THIS REGARD, HE INVI TED OUR ATTENTION TO ANOTHER DECISION RENDERED BY THE JURISDICTIONAL HIGH COURT IN THE CA SE OF STATE OF ANDHRA PRADESH VS. COMMERCIAL TAX OFFICER (1988)(169 ITR 564). 7. THE LD A.R, APART FROM PLACING RELIANCE ON TH E CASE LAW RELIED UPON BEFORE THE LD CIT(A), ALSO PLACED RELIANCE ON THE FOLLOWING DECIS IONS:- I.T.A. NO.253/VIZ/2012 5 (A) CIT-XII VS. KAMAL WAHAL (2013)(84 CCH 024)(DEL HI). IN THIS CASE, THE ASSESSEE PURCHASED A PROPERTY IN THE NAME OF HIS WI FE AND CLAIMED EXEMPTION U/S 54F OF THE ACT. THE HIGH COURT ALLOWED THE SAI D CLAIM. (B) VINAY MISHRA VS. ACIT (2012)(79 DTR (BANG.)(TRI B.) 1. IN THIS CASE, THE ASSESSEE PURCHASED A HOUSE PROPERTY IN USA. THE EX EMPTION CLAIMED U/S 54F OF THE ACT WAS ALLOWED BY THE TRIBUNAL. (C) SHRI GRANDHI KAMARAJ MANGARAJ (ITA NO.432/CIT( A)/VJA/10-11). IN THIS CASE, THE VERY SAME LD CIT(A) ALLOWED THE CLAIM OF DEDUCTION U/S 54 OF THE ACT IN RESPECT OF THE PROPERTY PURCHASED IN THE JOINT N AME OF ASSESSEE AND HIS WIFE. (D) SHRI N.RAMKUMAR VS. ACIT (ITA NO.1901/HYD/2011 ) DATED 10-08-2012. IN THIS CASE, THE HYDERABAD BENCH OF TRIBUNAL ALLOWED THE CLAIM OF DEDUCTION U/S 54F OF THE ACT IN RESPECT OF THE HOUSE PURCHASED IN THE NAME OF ASSESSEES MINOR DAUGHTER. HE SUBMITTED THAT, IN ALL THESE CASES, THE OBJECT O F GRANTING EXEMPTION UNDER SEC. 54/54F WAS TAKEN INTO ACCOUNT BY THE COURTS IN ORDE R TO DECIDE THE ISSUE IN FAVOUR OF THE ASSESSEE. THE LD COUNSEL, IN THIS REGARD, INVI TED OUR ATTENTION TO THE FOLLOWING OBSERVATIONS MADE BY HONBLE DELHI HIGH COURT IN TH E CASE OF KAMAL WAHAL (REFERRED SUPRA):- 9. IT THUS APPEARS TO US THAT THE PREDOMINANT JUD ICIAL VIEW, INCLUDING THAT OF THIS COURT, IS THAT FOR THE PURPOSES OF SECTION 54F , THE NEW RESIDENTIAL HOUSE NEED NOT BE PURCHASED BY THE ASSESSEE IN HIS OWN NA ME NOR IS IT NECESSARY THAT IT SHOULD BE PURCHASED EXCLUSIVELY IN HIS NAME. IT IS MOREOVER TO BE NOTED THAT THE ASSESSEE IN THE PRESENT CASE HAS NOT PURCHASED THE NEW HOUSE IN THE NAME OF A STRANGER OR SOMEBODY WHO IS UNCONNECTED WITH H IM. HE HAS PURCHASED IT ONLY IN THE NAME OF HIS WIFE. THERE IS NO DISPUTE THAT THE ENTIRE INVESTMENT HAS COME OUT OF THE SALE PROCEEDS AND THAT THERE WAS NO CONTRIBUTION FROM THE ASSESSEES WIFE. 8. THE LD D.R, ON THE CONTRARY, STRONGLY DEFEND ED THE ORDER PASSED BY LD CIT(A). HE SUBMITTED THAT THE RELIANCE PLACED UPON BY THE A SSESSEE IN THE CASE OF LATE MIR GULAM ALI KHAN (SUPRA) IS MISPLACED. HE SUBMITTED THAT THE SAID DECISION WAS RENDERED UNDER PECULIAR FACTS PREVAILING IN THAT CASE. HE S UBMITTED THAT THE ASSESSEE THEREIN HAD SOLD A HOUSE PROPERTY AND HE HIMSELF ENTERED INTO A N AGREEMENT TO PURCHASE ANOTHER RESIDENTIAL HOUSE. HE ALSO PAID EARNEST MONEY. HO WEVER, BEFORE COMPLETION OF THE I.T.A. NO.253/VIZ/2012 6 PURCHASE TRANSACTION, HE EXPIRED AND HENCE HIS LEGA L REPRESENTATIVE COMPLETED THE TRANSACTION OF PURCHASE. HENCE THE LEGAL REPRESENT ATIVE CLAIMED DEDUCTION U/S 54 OF THE ACT AGAINST THE CAPITAL GAIN ARISING ON THE PRO PERTY SOLD BY THE LATE ASSESSEE. SINCE THE TRANSACTION OF PURCHASE WAS INITIATED BY THE AS SESSEE HIMSELF AND FURTHER SINCE THE LEGAL REPRESENTATIVE OF THE ASSESSEE COMPLETED THE VERY SAME TRANSACTION, THE HONBLE COURT HAS HELD THAT THE LEGAL REPRESENTATIVE WAS EN TITLED TO CLAIM DEDUCTION U/S 54 OF THE ACT. HE SUBMITTED THAT IT IS THE LEGAL REPRESE NTATIVE, WHO IS ASSESSABLE AS REPRESENTATIVE OF THE DECEASED ASSESSEE. ACCORDING LY HE SUBMITTED THAT THE ASSESSEE COULD NOT PLACE RELIANCE ON THE SAID DECISION. 9. THE LD D.R FURTHER SUBMITTED THAT THE BENEFI T OF EXEMPTION U/S 54B AND 54F COULD BE GIVEN TO AN ASSESSEE ONLY IF THE NEW PROPERTY IS PURCHASED IN HIS OWN NAME. IN THIS REGARD, THE LD D.R PLACED RELIANCE ON THE FOLLOWING CASE LAW. WE ARE EXTRACTING THE HEAD NOTES OF THE SAID CASE LAW ALSO BELOW:- (A) JAI NARAYAN VS. ITO (2008)(306 ITR 335) . CAPITAL GAINS EXEMPTION UNDER S. 54B INVESTMENT IN THE NAMES OF ASSESSEE S SON AND GRAND SON SEC. 54B NOWHERE SUGGESTS THAT THE LEGISLATURE INTENDED TO ADVANCE THE BENEFIT OF THE SAID SECTION TO AN ASSESSEE WHO PURCHASES AGRICULTU RAL LAND EVEN IN THE NAME OF A THIRD PERSON TERM ASSESSEE IS QUALIFIED BY TH E EXPRESSION PURCHASED ANY OTHER LAND FOR BEING USED FOR AGRICULTURAL PURPOSES - THIS NECESSARILY MEANS THAT THE NEW ASSET HAS TO BE IN THE NAME OF THE ASSESSEE HIMSELF - THEREFORE, PURCHASE OF AGRICULTURAL LAND BY THE ASSESSEE IN TH E NAME OF HIS SON OR GRANDSON DOES NOT QUALIFY FOR EXEMPTION UNDER S. 54B. (B) PRAKASH VS. INCOME TAX OFFICER & ORS (2009)(312 ITR 40) . CAPITAL GAINS EXEMPTION UNDER S. 54F PURCHASE OF NEW PRO PERTY IN THE NAME OF SON NEW PROPERTY MUST BE OWNED BY THE ASSESSEE HAVING L EGAL TITLE OVER THE SAME ASSESSEE ADMITTEDLY PURCHASED THE NEW PROPERTY IN T HE NAME OF ADOPTED SON WITH CLEAR INTENTION TO TRANSFER THE PROPERTY TO HI M THUS, HE TRANSFERRED THE PROPERTY BEFORE THE PRESCRIBED PERIOD AS PER THE SC HEME OF THE SECTION, AND THE SON BECAME OWNER OF THE PROPERTY FOR ALL PURPOSES ASSESSEE HAD NO DOMAIN AND / OR RIGHT WHATSOEVER IN THE SAID PROPERTY T HEREFORE, HE IS NOT ENTITLED TO EXEMPTION UNDER S. 54F. (C) INCOME TAX OFFICER VS. PRAKASH TIMAJI DHANJODE (200 3)(81 TTJ (NAG.) 694 - CAPITAL GAINS EXEMPTION UNDER S. 54F CONDITION PRECEDENT INVESTMENT HAS TO BE MADE IN THE NAME OF ASSESSEE SALE PROCEEDS NOT INVESTED IN THE NAME OF ASSESSEE BUT IN THE NAME OF HIS ADOPTED SON ASSESSEE I.T.A. NO.253/VIZ/2012 7 NOT ENTITLED TO EXEMPTION UNDER S. 54F. (THIS DECI SION OF TRIBUNAL HAS BEEN APPROVED BY HONBLE HIGH COURT OF BOMBAY IN THE PRE CEDING DECISION). THE LD D.R FURTHER SUBMITTED THAT THE VARIOUS CASE LAW RELIED UPON BY THE ASSESSEE ARE NOT APPLICABLE TO THE FACTS OF THE INSTANT CASE, SI NCE IN THOSE CASES THE PROPERTY WAS PURCHASED EITHER IN THE JOINT NAMES OF ASSESSEE AND OTHERS OR IN THE NAME OF WIFE OR MINOR DAUGHTERS OF THE ASSESSEE. 10. THE LD D.R SUBMITTED THAT THE PROVISIONS OF SEC. 54B/54F SHOULD BE CONSTRUED IN A STRICT MANNER HENCE DEDUCTION COULD BE GIVEN UNDE R THOSE PROVISIONS, ONLY IF ALL THE CONDITIONS PRESCRIBED THEREIN ARE COMPLIED WITH PRO PERLY. IN THIS REGARD, HE PLACED RELIANCE ON THE FOLLOWING CASE LAW:- (A) DARAPANENI CHENNA KRISHNAYYA (HUF) VS. CIT (2007)(2 91 ITR 98)(AP) - CAPITAL GAINS EXEMPTION UNDER S. 54B ALLOWABILIT Y TO HUF BENEFIT UNDER S. 54B IS AVAILABLE ONLY TO AN INDIVI DUAL AND NOT HUF CIT VS. G.K. DEVARAJULU (1991) 92 CTR (MAD) 184 : (1991) 191 ITR 211 (MAD) CONCURRED WITH. (B) VIPIN MALIK (HUF) VS. CIT (2011)( 330 ITR 309)(DEL) CAPITAL GAINS EXEMPTION UNDER S. 54F PURCHASE/CONSTRUCTION OF NE W HOUSE ASSESSEE HAD PAID MOST OF THE AMOUNT TO THE CO-OPERATIVE SOCIETY FOR THE PURCHASE OF FLAT MORE THAN ONE YEAR BEFORE THE SALE OF AGRICULTURAL LAND IN SEPTEMBER, 1995 ALLOTMENT LETTER OR THE DRAW OF LOTS TOOK PLACE ONLY IN SEPTE MBER/OCTOBER, 1998 I.E., AFTER TWO YEARS OF THE SALE OF AGRICULTURAL LAND THEREF ORE, ASSESSEE CANNOT BE SAID TO HAVE PURCHASED A RESIDENTIAL HOUSE WITHIN THE MEANI NG OF S. 54F EITHER WITHIN ONE YEAR BEFORE THE SALE OF AGRICULTURAL LAND OR WI THIN TWO YEARS AFTER THE SALE THAT APART, AGRICULTURAL LAND THAT WAS SOLD BELONGE D TO ASSESSEE HUF WHEREAS THE FLAT WAS PURCHASED IN THE INDIVIDUAL NAME OF TH E KARTHA ALONG WITH HIS MOTHER THUS, THE NEW HOUSE WAS NOT PURCHASED BY T HE SAME ASSESSEE WHO SOLD THE AGRICULTURAL LAND HENCE, EXEMPTION UNDER S. 54F WAS NOT ALLOWABLE. 11. WE HAVE HEARD THE RIVAL CONTENTIONS AND CAR EFULLY THE RECORD. SUB SECTION (1) OF SEC. 54B OF THE ACT READS AS UNDER:- 54B(1) SUBJECT TO THE PROVISIONS OF SUB-SECTION (2 ), WHERE THE CAPITAL GAIN ARISES FROM THE TRANSFER OF A CAPITAL ASSET BEING LAND WHI CH, IN THE TWO YEARS IMMEDIATELY PRECEDING THE DATE ON WHICH THE TRANSFE R TOOK PLACE, WAS BEING USED BY THE ASSESSEE OR A PARENT OF HIS FOR AGRICULTURAL PURPOSES (HERE INAFTER REFERRED TO AS THE ORIGINAL ASSET), AND THE ASSESSEE HAS , WITHIN A PERIOD OF TWO I.T.A. NO.253/VIZ/2012 8 YEARS AFTER THAT DATE, PURCHASED ANY OTHER LAND FOR BEING USED FOR AGRICULTURAL PURPOSES, THEN, INSTEAD OF THE CAPITAL GAIN BEING C HARGED TO INCOME-TAX. SUB-SECTION (1) OF SEC. 54F READS 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 UNDIVIDED FAMILY, T HE CAPITAL GAIN ARISES FROM THE TRANSFER OF ANY LONG TERM CAPITAL ASSET, N OT BEING A RESIDENTIAL HOUSE (HEREINAFTER IN THIS SECTION REFERRED TO AS THE ORI GINAL ASSET), AND THE ASSESSEE HAS , WITHIN A PERIOD OF ONE YEAR BEFORE OR TWO YEARS A FTER THE DATE ON WHICH THE TRANSFER TOOK PLACE PURCHASED, OR HAS WITHIN A PERI OD OF THREE YEARS AFTER THAT DATE 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 THE QUESTION THAT ARISES FOR OUR CONSIDERATION IS W HETHER THE EXPRESSION ASSESSEE MEANT ONLY THE PERSON WHO SOLD THE PROPERTY, WHICH WAS SUBJECTED TO CAPITAL GAIN, I.E., WHETHER THE NEW ASSET SHOULD NECESSARILY BE INVESTE D IN THE NAME OF THE PERSON WHO SOLD THE PROPERTY. 12. IN THE INSTANT CASE, THE ASSESSEE HAS INVES TED MONEY IN PURCHASE OF AN AGRICULTURAL LAND (ELIGIBLE FOR DEDUCTION U/S 54B O F THE ACT) AND A RESIDENTIAL FLAT (ELIGIBLE FOR DEDUCTION U/S 54F OF THE ACT) IN THE NAME OF HE R TWO DAUGHTERS, BOTH ARE APPARENTLY MAJORS AND ALSO MARRIED. THE LD A.R PLACED HIS REL IANCE ON HOSTS OF CASE LAW, MORE PARTICULARLY UPON THE DECISION OF HONBLE JURISDICT IONAL HIGH COURT OF ANDHRA PRADESH IN THE CASE OF LATE MIR GULAM ALI KHAN (SUPRA). WE FU LLY AGREE WITH THE CONTENTION OF THE LD D.R THAT THE DECISION RENDERED BY THE JURISDICTI ONAL HIGH COURT IN THE CASE OF LATE MIR GULAM ALI KHAN (SUPRA) IS BASED UPON PECULIAR F ACTS PREVAILING IN THAT CASE. THE VITAL POINT, IN OUR VIEW, IS THAT THE ASSESSEE (IN THE CASE OF LATE MIR GULAM ALI KHAN (SUPRA)) HAD ENTERED INTO AN AGREEMENT FOR PURCHAS ING A RESIDENTIAL HOUSE AND ALSO PAID EARNEST MONEY IN FURTHERANCE OF THE SAME. UNF ORTUNATELY HE PASSED AWAY BEFORE COMPLETION OF THE PURCHASE TRANSACTION. HENCE, THE LEGAL REPRESENTATIVE OF THAT ASSESSEE COMPLETED THE PROCESS OF PURCHASE OF PROPE RTY. THUS, IN EFFECT, THE NEW HOUSE PROPERTY WAS NOT PURCHASED IN THE NAME OF THE ASSESSEE, WHO SOLD THE OLD PROPERTY. SINCE THE SAID LEGAL REPRESENTATIVE OF T HE ASSESSEE IS LIABLE TO BE ASSESSED IN RESPECT OF THE CAPITAL GAIN ON THE PROPERTY SOLD BY HIS FATHER, HE CLAIMED THE COST OF I.T.A. NO.253/VIZ/2012 9 NEW PROPERTY AS DEDUCTION U/S 54 OF THE ACT. THUS, THE FACTS PREVAILING IN LATE MIR GULAM ALI KHAN (SUPRA) CASE IS PECULIAR AND FURTHER , UNDER SECTION 159 OF THE ACT, THE LEGAL REPRESENTATIVE IS TREATED AS ASSESSEE IN RESP ECT OF LIABILITY OF THE DECEASED PERSON. HENCE, UNDER PECULIAR FACTS OF THE CASE, THE HONBL E JURISDICTIONAL HIGH COURT HELD THAT THE TERM ASSESSEE SHALL INCLUDE LEGAL REPRESENTAT IVE ALSO. IN OUR VIEW, THE LIBERAL VIEW TAKEN BY THE HIGH COURT CANNOT BE STRETCHED IN EACH AND EVERY CASE, WHERE THE PROPERTY WAS NOT PURCHASED IN THE NAME OF THE ASSES SEE, WHO SOLD THE PROPERTY. ACCORDINGLY, IN OUR VIEW, THE ASSESSEE HEREIN CANNO T DERIVE SUPPORT FROM THE SAID CASE LAW. 13. WE HAVE GONE THROUGH ALL OTHER CASE LAW, WH ICH WERE RELIED UPON BY LD A.R DURING THE COURSE OF HIS ARGUMENTS. WE NOTICE THAT , IN ALL THOSE CASES, THE NEW PROPERTY WAS EITHER PURCHASED IN JOINT NAMES, I.E., IN THE NAME OF THE ASSESSEE AND OTHERS, OR IT WAS PURCHASED IN THE NAME OF SPOUSE O R MINOR DAUGHTER. IN OUR VIEW, THE COURTS HAVE CONSIDERED THE INVESTMENTS MADE IN THE NAME OF WIFE OR MINOR DAUGHTER AS AN INVESTMENT MADE BY THE ASSESSEE HIMSELF FOR THE REASON THAT THERE WAS NO REAL INTENTION TO PROVIDE CONSIDERATION FOR THE BENEFIT OF WIFE/MINOR DAUGHTER ALONE. 14. IN THE INSTANT CASE, UNDISPUTEDLY, THE INVE STMENTS HAVE BEEN MADE IN THE NAME OF MARRIED DAUGHTERS AND APPARENTLY BOTH OF THEM AR E ALSO MAJORS. THUS, IT IS NOT A CASE OF JOINT OWNERSHIP ALONG WITH THE ASSESSEE. B OTH THE DAUGHTERS OF THE ASSESSEE SHALL HAVE EVERY RIGHT OVER THE PROPERTY PURCHASED IN THEIR RESPECTIVE NAMES. THUS, IT CANNOT BE SAID THAT THE INTENTION OF PURCHASING THE PROPERTIES WAS NOT TO GIVE BENEFIT TO THEM. THE ASSESSEE CLAIMS THAT SHE HAS ENTERED INTO A PURCHASE POSSESSION AGREEMENT WITH HER TWO DAUGHTERS. HOWEVER, WE TEND TO AGREE WITH THE VIEW OF THE LD CIT(A) THAT THE SAID AGREEMENT DOES NOT ACTUALLY EFFECT TR ANSFER OF ASSETS TO THE NAME OF THE ASSESSEE. FURTHER, AS POINTED OUT BY THE AO, THE S AID AGREEMENTS HAVE BEEN ENTERED ONLY TO SHOW SOME COMPLIANCE WITH THE PROVISIONS OF SEC. 54B/54F OF THE ACT. I.T.A. NO.253/VIZ/2012 10 15. ACCORDINGLY, IN OUR VIEW, THE TERM ASSESSEE USED IN SEC. 54B/54F OF THE ACT CANNOT BE EXTENDED TO MEAN THE MAJOR MARRIED DAUGHT ERS. ACCORDINGLY, WE AFFIRM THE VIEW TAKEN BY THE LD CIT(A). 16. IN THE RESULT, THE APPEAL FILED BY THE ASSE SSEE IS DISMISSED. PRONOUNCED ACCORDINGLY ON 22-07-2013 SD/- SD/- (D MANMOHAN) (B.R.BASKARAN) VICE PRESIDENT ACCOUNTANT MEMBER PLACE: VISAKHAPATNAM DATED: 22ND JULY, 2013 RAJ COPY TO: 1. SMT GANTA VIJAYA LAKSHMI, C/O SRI C SUBRAHMANYAM ,CA,102 LAKSHMI APARTMENTS FACOR LAYOUT, WALTAIR UPLANDS, VISAKHAPATNAM 53 0 003 2. THE INCOME TAX OFFICER WARD 1(3), VIJAYAWADA 3. THE COMMISSIONER OF INCOME-TAX (APPEALS) VIJAYAW ADA. 4. THE COMMISSIONER OF INCOME-TAX, VIJAYAWADA 5. D.R., I.T.A.T., VISAKHAPATNAM 6. GUARD FILE.