Smt Vinita Awasthee, Indore V. The ITO, Indore

ITA 311/IND/2010

• Counselvise Citation: 31122714 RSA 2010
• Duration Of Justice: 1 year(s) 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-07-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2005-2006
• Appeal Filed On: 17-05-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARUN DEWAN
• Assessee Lawyers: S N AGRAWAL
• Keywords: Benefit of exemption; Capital Gains
• Section: 143(3); 54F; 139(1); 54; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL , INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, J.M. AND SHRI R.C.SHARMA, A.M. PAN NO. : AAZPA9691A I.T.A.NO. 311 / IND /20 10 A.Y. : 2005 - 06 SMT. VINITA AWASTHI, INCOME TAX OFFICER, 23,JOY BUILDERS COLONY, VS 3(2), OPP. UNIVARTA, OLD PALASIA, INDORE. RANGE 1, INDORE. APPELLANT RESPONDENT APPELLANT BY : SHRI S.N. AGRAWAL, C. A. RESPONDENT BY : SHRI ARUN DEWAN, SR. DR O R D E R PER R. C. SHARMA, A.M. THIS IS AN APPEAL FILED BY THE ASSESSE E AGAINST THE ORDER OF CIT(A) DATED 2 ND FEBRUARY, 2010, FOR THE ASSESSMENT YEAR 2005 - 06, IN THE MATTER OF ORDER PASSED U/S 143(3) OF THE INCOME - TAX ACT, 1961. - : 2 : - 2 2. THE ONLY GRIEVANCE OF THE ASSESSEE RELATES TO DECLINE OF CLAIM OF EXEMPTION U/S 54F OF THE INCOME - TAX ACT, 1961. 3. RIVAL CONTENTIONS HAVE BEEN HEARD AND RECORDS PERUSED. FACTS IN BRIEF ARE THAT THE ASSESSEE RECEIVED SALE PROCEEDS OF RS. 10 LAKHS ON SALE OF PLOT OF LAND DURING THE YEAR. THE PLOT WAS SOLD ON 3 RD JANUARY, 2005, FALLING IN THE FINANCIAL Y EAR 2004 - 05 RELEVANT TO ASSESSMENT YEAR UNDER CONSIDERATION 2005 - 06. CAPITAL GAIN ON SALE OF PLOT WORKED OUT TO BE RS. 6,44,229/ - . THE ASSESSEE INVESTED SALE PROCEEDS IN PURCHASE OF NEW HOUSE ON 28.12.2005 AND FILED HER RETURN OF INCOME ON 31 ST MARCH, 200 6, WHEREIN ENTIRE CAPITAL GAIN WAS CLAIMED AS EXEMPT U/S 54F(1). THE AO DECL INED ASSESSEE S CLAIM ON THE PLEA THAT LAST DATE OF FILING RETURN U/S 139(1) WAS 31 ST JULY, 2005, AND TILL THAT DATE THE ASSESSEE HAS NOT UTILIZED THE CAPITAL GAINS FOR PURCHASE OF NEW HOUSE NOR DEPOSITED THE SAME IN THE CAPITAL GAINS TAX ACCOUNT, THEREFORE, NO BENEFIT OF EXEMPTION U/S 54F CAN BE ALLOWED. BY THE IMPUGNED - : 3 : - 3 ORDER, THE LD. CIT(A) CONFIRMED THE AO S ACTION AND THE ASSESSEE IS IN FURTHER APPEAL BEFORE US. 4. WE HAVE CONSIDER ED THE RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND FOUND FROM RECORD THAT THE ASSESSEE HAS UTILIZED ENTIRE SALE CONSIDERATION FOR PURCHASE OF NEW HOUSE BEFORE FILING OF ITS RETURN FOR THE RELEVANT ASSESSMENT YEAR UNDER CONSIDERATION. AS PER THE PROVISIONS OF SECTION 54(1), THE ASSESSEE HAS PURCHASED RESIDENTIAL HOUSE WITHIN TWO YEARS FROM THE DATE OF SALE OF HER PLOT. THE ISSUE UNDER CONSIDERATION IS SQUARELY COVERED BY THE DECISION OF THE HON'BLE GAUHATI HIGH COURT IN THE CASE OF RAJESH KUMAR JALAN, 286 ITR 274, WHEREIN IT WAS HELD THAT THE ASSESSEE CAN FULFILL THE REQUIREMENT OF SECTION 54 OF DEPOSITING THE UNUTILIZED PORTION OF CAPITAL GAINS OF RESIDENTIAL PROPERTIES IN NOTIFIED SCHEME UP TO THE EXPIRY OF TIME LIMIT F OR FILING RETURN U/S 139(4). FOLLOWING WAS THE PRECISE OBSERVATION OF THE HON'BLE HIGH COURT : - FROM A PLAIN READING OF SUB SECTION (2) OF SECTION 54, IT IS CLEAR THAT ONLY SECTION 139 IS MENTIONED IN SECTION 54(2) IN THE CONTEXT THAT THE UNUTILIZED - : 4 : - 4 PORTI ON OF THE CAPITAL GAIN ON THE SALE OF PROPERTY USED FOR RESIDENCE SHOULD BE DEPOSITED BEFORE THE DATE OF FURNISHING THE RETURN OF THE INCOME TAX UNDER SECTION 139. SECTION 139 CANNOT BE MEANT ONLY AS SECTION 139(1) BUT IT MEANS ALL SUB - SECTIONS OF SECTION 139. UNDER SUB SECTION (4) OF SECTION 139, ANY PERSON WHO HAS NOT FURNISHED A RETURN WITHIN THE TIME ALLOWED TO HIM UNDER SUB SECTION (1) OF SECTION 142 MAY FURNISH THE RETURN FOR ANY PR EVIOUS YEAR AT ANY TIME BEFORE THE E XPIRY OF ONE YEAR FROM THE END OF THE RELEVANT ASSESSMENT YEAR OR BEFORE THE COMPLETION OF THE ASSESSMENT WHICHEVER IS EARLIER. SUCH BEING THE SITUATION , IT IS THE CASE OF THE ASSESSEE THAT THE ASSESSEE COULD FULFILL THE REQUIREMENT U/S 54 FOR EXEMPTION OF THE CAPITAL GAIN FROM BEING CHARGED TO INCOME TAX ON THE SALE OF PROPERTY USED FOR RESIDENCE UP TO 30 TH MARCH, 1998, INASMUCH AS THE RETURN OF INCOME T AX FOR THE ASSESSMENT YEAR 1996 - 97 COULD BE FURNISHED BEFORE THE EXPIRY OF ONE YEAR FROM THE END OF THE RELEVANT ASSESSMENT YEAR OR BEFORE THE COMPLETION OF THE ASSESSMENT WHICHEVER IS EARLIER UNDER SUB SECTION (4 ) OF SECTION 139. IN THE FACTS AND CIRCUMST ANCES OF THE CASE, THE ASSESSEE WAS ENTITLED TO CLAIM BENEFIT U/S 54 ON THE ENTIRE AMOUNT RECEIVED BY HIM ON ACCOUNT OF SALE OF HIS HOUSE PROPERTY. 5. SIMILAR VIEW HAS BEEN TAKEN BY THE I.T.A.T., BANGALORE BENCH IN THE CASE OF P.R.KULKARNI & SONS, HUF, 4 9 DTR 442, WHEREIN IT WAS HELD THAT THE ASSESSEE WAS ENTITLED TO EXEMPTION OF THE ENTIRE INVESTMENT UP TO THE DATE OF FILING OF THE RETURN U/S 139(4). RESPECTFULLY FOLLOWING THE DECISION OF THE HON'BLE HIGH COURT AND I.T.A.T. BANGALORE BENCH AS MENTIONED A BOVE, WE DO NOT - : 5 : - 5 FIND ANY MERIT IN THE ACTION OF THE LOWER AUTHORITIES FOR DECLINING CLAIM OF DEDUCTION U/S 54F ON THE PLEA THAT THE AMOUNT WAS NOT UTILIZED BEFORE FILING OF RETURN U/S 139(1) OF THE INCOME - TAX ACT, 1961. WE, THEREFORE, DIRECT THE AO TO ALL OW ASSESSEE S CLAIM U/S 54F. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. THIS ORDER HAS BEEN PRONOUNCED IN THE OPEN COURT ON 20 TH JU LY , 2011. SD/ - SD/ - (JOGINDER SINGH) ( R.C.SHARMA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 20 TH JU LY , 2011 . CPU* 2021