PRAKASH KARNAWAT, Jaipur V. ITO, Jaipur

ITA 364/JPR/2011

• Counselvise Citation: 36423114 RSA 2011
• Duration Of Justice: 6 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-11-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 03-11-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 25-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D K MEENA
• Assessee Lawyers: VIMAL CHOPRA
• Keywords: Sale consideration of property below Jantri Value; Capital asset; Cost of acquisition; Fair market value; Revised return
• Section: 50C; 54F; 54

Judgement Text

1 ITA 364-11 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH A JAIPUR. ( BEFORE SHRI R.K. GUPTA AND SHRI N.L. KALRA ) ITA NO. 364/JP/2011 ASSTT. YEAR : 2006-07. SHRI PRAKASH KARNAWAT, VS. THE INCOME-TAX OFFICE R, B-33, GANESH MARG, BAPU NAGAR, WARD 6(2), JAIPUR. JAIPUR. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI VIMAL CHOPRA RESPONDENT BY : SHRI D.K. MEENA DATE OF HEARING : 03.11.2011 DATE OF PRONOUNCEMENT : 18.11.2011. ORDER DATED : 18/11/2011. PER R.K. GUPTA, J.M. THIS IS AN APPEAL BY ASSESSEE AGAINST THE ORDER OF LD. CIT (A) RELATING TO ASSESSMENT YEAR 2006-07. 2. THE ASSESSEE IS OBJECTING IN CONFIRMING THE REPL ACEMENT OF ACTUAL SALES CONSIDERATION BY APPLYING PROVISIONS OF SECTION 50C OF THE I.T. ACT. THE ASSESSEE HAS ALSO FILED AN AMENDMENT/ADDITIONAL GROUND. GROUND N O. 3A IS A SUMMARIZED GROUND TAKEN ORIGINALLY. GROUND NO. 3B IS AN ALTERNATE GRO UND WHICH WAS TAKEN AS ADDITIONAL GROUND NOW READS AS UNDER :- 3B. ALTERNATIVELY, IN THE FACTS AND CIRCUMSTANCE S OF THE CASE AND IN LAW THE LEARNED COMMISSIONER (APPEALS) HAS ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN N OT 2 ALLOWING THE EXEMPTION UNDER SECTION 54EC IN RESPEC T OF LONG-TERM CAPITAL GAINS. THE ACTION OF THE LEARNED COMMISSIONER (APPEALS) IS ILLEGAL, UNJUSTIFIED, ARB ITRARY AND AGAINST THE FACTS OF THE CASE. RELIEF MAY PLEAS E BE GRANTED BY ALLOWING THE EXEMPTION UNDER SECTION 54E C IN RESPECT OF LONG TERM CAPITAL GAINS. 3. THE FACTS IN BRIEF ARE THAT ASSESSEE SOLD PROPER TY FOR RS. 40 LACS ON 12.1.2006 BY WAY OF REGISTERED SALE DEED. FOR THE PURPOSES OF I MPOSING STAMP DUTY, THE VALUE ADOPTED BY SUB REGISTRAR WAS RS. 74,58,880/-. THE AO WAS O F THE VIEW THAT PROVISIONS OF SECTION 50C ARE APPLICABLE ON THE FACTS OF THE PRESENT CASE . THEREFORE, A SHOW CAUSE NOTICE WAS GIVEN AS TO WHY THE SALE VALUE OF THIS PLOT BE NOT ADOPTED AT RS. 74,58,880/- AGAINST THE SALE CONSIDERATION SHOWN BY ASSESSEE. DETAILED SUB MISSIONS WERE FILED BEFORE AO WHICH IS REPRODUCED IN THE ORDER OF AO FROM PAGES 2 TO 20 . AFTER CONSIDERING THE REPLY OF THE ASSESSEE, THE AO WAS NOT SATISFIED AS IN HIS VIEW T HE PROVISIONS OF SECTION 50C ARE CLEARLY APPLICABLE. ACCORDINGLY HE REVALUED THE CAPITAL GA IN. THE AO TOOK THE VALUE DETERMINED BY DVO UNDER SECTION 50C AT RS. 67,12,600/-. ASSES SEE HAS SHOWN INDEXED COST OF RS. 13,26,990/- WHICH WAS REDUCED BY THE AO. AFTER RED UCING THE SAME, THE LONG TERM CAPITAL GAIN COMPUTED BY AO AT RS. 53,85,610/-. SI NCE ASSESSEE HAS MADE INVESTMENT IN BONDS OF RS. 40,00,000/-, THEREFORE, THE SAME WAS A LSO REDUCED AND THE REMAINING AMOUNT OF RS. 13,85,610/- WAS ADDED TO THE INCOME OF THE A SSESSEE. THE LD. CIT (A) HAS CONFIRMED THE ACTION OF THE AO. 4. NOW THE ASSESSEE IS IN APPEAL HERE BEFORE THE TR IBUNAL. 5. THE LD. COUNSEL OF THE ASSESSEE WHO APPEARED STA TED THAT THE ISSUE IS SQUARELY COVERED BY THE DECISION OF JAIPUR BENCH IN THE CASE OF GYAN CHAND BATRA VS. ITO, 133 TTJ 482 AND ALSO BY THE DECISION OF BANGALORE BENCH IN CASE OF GOULI MAHADEVAPPA VS. 3 ITO, 9 ITR 129 (TRIB.). IT WAS FURTHER EXPLAINED T HAT IN FACT ENTIRE AMOUNT OF SALE CONSIDERATION WAS INVESTED IN BONDS. THEREFORE, WHE RE THE ENTIRE AMOUNT OF CONSIDERATION IS INVESTED, THEN PROVISIONS OF SECTION 50C CANNOT BE INVOKED AS HELD BY JAIPUR BENCH OF THE TRIBUNAL IN CASE OF GYAN CHAND BATRA (SUPRA) AN D IN CASE OF GOULI MAHADEVAPPA (SUPRA). THEREFORE, IT WAS SUBMITTED THAT ASSESSEE HAS CHALLENGED THE VALUATION ADOPTED BY THE SUB REGISTRAR AND DETAILED VALUATION FROM TH E REGISTERED VALUER WAS ALSO FILED. THEREFORE, FOR THIS REASON ALSO ADDITION SHOULD NOT HAVE BEEN MADE. COPY OF BRIEF NOTE WAS ALSO FILED. 6. ON THE OTHER HAND, THE LD. D/R PLACED RELIANCE O N THE ORDERS OF AO AND LD. CIT (A). 7. AFTER CONSIDERING THE SUBMISSIONS AND PERUSING T HE MATERIAL ON RECORD, WE FIND THAT ASSESSEE DESERVES TO SUCCEED ON THE BASIS OF A DDITIONAL GROUND RAISED. WE NOTED THAT SIMILAR ISSUE CAME BEFORE THE TRIBUNAL IN CASE OF G YAN CHAND BATRA (SUPRA). IN THIS CASE THE ASSESSEE DECLARED LONG TERM CAPITAL GAIN OF RS. 5,558/-. THE PLOT WAS SOLD FOR A SALE CONSIDERATION OF RS. 10.81 LACS. THE AO INVOKED PRO VISIONS OF SECTION 50C OF THE ACT AND ACCORDINGLY FULL VALUE OF CONSIDERATION WAS TAKEN A T RS.19,24,987/- WHICH WAS TAKEN BY THE SUB REGISTRAR FOR THE PURPOSE OF STAMP DUTY. A CCORDINGLY, THE AO RE-COMPUTED THE CAPITAL GAIN. THE LD. CIT (A) CONFIRMED THE ACTION OF THE AO. ON SECOND APPEAL BEFORE THE TRIBUNAL, DETAILED SUBMISSIONS WERE FILED AND R ELIANCE WAS PLACED ON VARIOUS CASE LAWS. AFTER ANALYZING ALL THE FACTS AND CIRCUMSTAN CES OF THE CASE, THE TRIBUNAL HAS GIVEN ITS FINDING IN PARA 7 TO 7.5 WHICH ARE REPRODUCED A S UNDER :- 7. WE HAVE HEARD BOTH THE PARTIES. SECTION 48 OF INCOME TAX ACT STATES THAT CAPITAL IS TO BE COMPUTED BY DEDUCT ING FROM THE FULL 4 VALUE OF THE CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF THE TRANSFER OF THE CAPITAL ASSET THE EXPENDITURE INCU RRED IN CONNECTION WITH TRANSFER AND THE COST OF ACQUISITION OF THE AS SET AND THE COST OF ANY IMPROVEMENT THERETO. HENCE, WE WILL HAVE TO FIR ST ASCERTAIN THE FULL VALUE OF THE CONSIDERATION. IN RESPECT OF TRAN SFER OF CAPITAL ASSET BEING LAND OR BUILDING, FULL VALUE OF THE CONSIDERA TION TO BE ADOPTED FOR THE PURPOSE OF SECTION 48 IS DEFINED IN SECTIO N 50C OF THE INCOME TAX ACT. IT WILL BE USEFUL TO REPRODUCE SECT ION 50C(1) OF THE INCOME TAX ACT. 50C(1) WHERE THE CONSIDERATION RECEIVED OR ACCRU ING AS A RESULT OF THE TRANSFER BY AN ASSESSEE OF A CAPITAL ASSET, BEING LAND OR BUILDING OR BOTH, IS LESS THAN THE VALUE A DOPTED OR ASSESSED BY ANY AUTHORITY OF A STATE GOVERNMENT (HE REAFTER IN THIS SECTION REFERRED TO AS THE STAMP VALUATIO N AUTHORITY) FOR THE PURPOSE OF PAYMENT OF STAMP DU TY IN RESPECT OF SUCH TRANSFER, THE VALUE SO ADOPTED OR A SSESSED SHALL, FOR THE PURPOSE OF SECTION 48, BE DEEMED TO BE THE FULL VALUE OF THE CONSIDERATION RECEIVED OR ACCRUIN G AS A RESULT OF SUCH TRANSFER. 7.1 FROM THE ABOVE SUB-SECTION, IT IS CLEAR THAT IN CASE THE CONSIDERATION RECEIVED IS LESS THAN THE ADOPTED VAL UE THE VALUE ADOPTED BY STAMP VALUATION AUTHORITY THEN THE VALUE SO ADOPTED IS TO BE TAKEN AS FULL VALUE OF THE CONSIDERATION FOR THE PURPOSES OF SECTION 48 OF THE ACT. SECTION 50C PROVIDES A DEEM ING PROVISION FOR CONSIDERING THE FULL VALUE OF CONSIDERATION AS THE VALUE ADOPTED FOR STAMP DUTY. IN MODERN STATUTES, THE EXPRESSION DEEM IS USED A GREAT DEAL AND FOR MANY PURPOSES. IT IS AT TIMES US ED TO INTRODUCE ARTIFICIAL CONCEPTION WHICH ARE INTENDED TO GO BEYO ND LEGAL PRINCIPLES OR TO GO AN ARTIFICIAL CONSTRUCTION OF A WORD FOR PHRASE. THUS THE ARTIFICIAL MEANING OF FULL VALUE OF THE CO NSIDERATION HAVE BEEN GIVEN IN SECTION 50C OF THE INCOME TAX ACT FOR THE PURPOSE OF SECTION 48 OF THE INCOME TAX ACT. ONE IS ENTITLED T O ASCERTAIN THE PURPOSE FOR CREATING A STATUTORY FICTION. AFTER ASC ERTAINING THE 5 PURPOSE, FULL EFFECT MUST BE GIVEN TO THE STATUTORY FICTION AND IT SHOULD BE CARRIED TO ITS LOGICAL CONCLUSION AND TO THAT END, IT WOULD BE PROPER AND EVEN NECESSARY TO ASSUME ALL THOSE FA CTS ON WHICH ALONE FICTION CAN OPERATE. THE LEGISLATURE IN IS WI SDOM HAS REFERRED TO SECTION 48 OF INCOME TAX ACT IN SECTION 50C FOR ADOPTING THE SAME VALUE AS FAIR MARKET VALUE. HENCE, THE DEEMING FICTION AS PROVIDED IN SECTION 50C IN RESPECT OF THE WORD FUL L VALUE OF CONSIDERATION IS TO BE APPLIED ONLY FOR SECTION 48 OF THE INCOME TAX ACT. THE WORD FULL VALUE OF CONSIDERATION AS MENTIONED IN OTHER PROVISIONS OF THE ACT IS NOT GOVERNED BY THE MEANING OF FULL VALUE OF CONSIDERATION AS CONTAINED IN SECTION 50C OF THE INCOME TAX ACT. THE NATURAL MEANING OF FULL VALUE OF CONSI DERATION REFERS TO CONSIDERATION SPECIFIED IN THE SALE DEED. THE HO N'BLE DELHI HON'BLE HIGH COURT IN THE CASE CIT VS. SMT. NILOFER I SINGH, 309 ITR 233 HAD HELD THAT FULL VALUE OF CONSIDERATION R EFERS TO THE CONSIDERATION SPECIFIED IN THE SALE DEED. FOR DECID ING THE MEANING OF WORD FULL VALUE OF CONSIDERATION, THE HON'BLE DELHI HIGH COURT HAS REFERRED TO THE DECISION OF HON'BLE APEX COURT AT PAGE 237 AS UNDER : THIS CONTROVERSY HAS ALREADY BEEN SETTLED BY THE SUPREME COURT IN THE CASE OF CIT VS. GEORGE HENDERSON AND C O. LTD (1967) 66 ITR 622, THE VERY EXPRESSION FULL VA LUE OF CONSIDERATION WAS UNDER CONSIDERATION OF THE SUPRE ME COURT IN THE CONTEXT OF THE PROVISIONS OF THE INDI AN INCOME-TAX ACT, 1922. THE PROVISIONS OF SECTION 12B OF THE 1922 ACT PERTAIN TO CAPITAL GAINS. SUB-SECTION (1) WAS IN PARI MATERIAL TO SECTION 45(1) OF THE PRESENT ACT A ND SUB- SECTION (2) OF SECTION 12B OF THE 1922 ACT WAS IN P ARI MATERIAL TO THE PROVISIONS OF SECTION 48 OF THE PRE SENT ACT. THE SUPREME COURT WAS OF THE VIEW THAT THE EXPRESSI ON FULL VALUE OF CONSIDERATION IN THE MAIN PART OF S ECTION 12B(2) OF THE ACT CANNOT BE CONSTRUED AS HAVING A REFERENCE TO THE MARKET VALUE OF THE ASSET TRANSFER RED BUT THE EXPRESSION ONLY MEANT, THE FULL VALUE OF A CONSIDER ATION RECEIVED BY THE TRANSFEROR IN EXCHANGE OF THE CAPIT AL ASSET TRANSFERRED BY HIM. THE SUPREME COURT ALSO OBSERVED THAT IN THE CASE OF A SALE THE FULL VALUE OF CONSIDERATI ON IS THE 6 FULL SALE PRICE ACTUALLY PAID. IT WAS FURTHER OF TH E VIEW THAT THE EXPRESSION FULL VALUE MEANS THE WHOLE PRICE W ITHOUT ANY DEDUCTION, WHATSOEVER, AND IT CANNOT REFER TO T HE ADEQUACY OF THE PRICE BARGAINED FOR. NOR DID IT HAV E ANY NECESSARY REFERENCES TO THE MARKET VALUE OF THE CAP ITAL ASSET WHICH IS THE SUBJECT MATTER OF THE TRANSFER. HENCE, THE MEANING FULL VALUE OF CONSIDERATION AS M ENTIONED IN DIFFERENT PROVISIONS OF THE ACT EXCEPT IN SECTION 48, ONE WILL HAVE TO CONSIDER THE FULL VALUE OF CONSIDERATION AS SPEC IFIED IN SALE DEED. 7.2 BEFORE ASCERTAINING AS TO HOW THE DEDUCTION U/S 54F IS TO BE GIVEN, IT WILL BE USEFUL TO REPRODUCE SECTION 54F(1 ) 54F(1) [SUBJECT TO THE PROVISIONS OF SUB-SECTION 4, WHERE, IN THE CASE OF AN ASSESSEE BEING AN INDIVIDU AL OR A HINDU UNDIVIDED FAMILY], THE CAPITAL GAIN ARISES FR OM THE TRANSFER OF ANY LONG TERM CAPITAL ASSET, NOT BEING A RESIDENTIAL HOUSE (HEREAFTER IN THIS SECTION REFERRED TO AS THE ORIGINAL ASSET), AND THE ASSESSEE HAS, WITHIN A PER IOD OF ONE YEAR BEFORE OR [TWO YEARS] AFTER THE DATE ON WHICH THE TRANSFER TOOK PLACE PURCHASED, OR HAS WITHIN A PERI OD OF THREE YEARS AFTER THAT DATE CONSTRUCTED, A RESIDENT IAL HOUSE (HEREAFTER IN THIS SECTION REFERRED TO AS THE NEW A SSET), THE CAPITAL GAIN SHALL BE DEALT WITH IN ACCORDANCE WITH THE FOLLOWING PROVISIONS OF THIS SECTION, THAT IS TO SA Y,- (A) IF THE COST OF THE NEW ASSET IS NOT LESS THAN THE N ET CONSIDERATION IN RESPECT OF THE ORIGINAL ASSET, THE WHOLE OF SUCH CAPITAL GAIN SHALL NOT BE CHARGED UNDER SECTIO N 45; (B) IF THE COST OF THE NEW ASSET IS LESS THAN THE NET C ONSIDERATION IN RESPECT OF THE ORIGINAL ASSET, SO MUCH OF THE CA PITAL GAIN AS BEARS TO THE WHOLE OF THE CAPITAL GAIN THE SAME PROPORTION AS THE COST OF THE NEW ASSET BEARS TO TH E NET CONSIDERATION, SHALL NOT BE CHARGED UNDER SECTION 4 5: [PROVIDED THAT NOTHING CONTAINED IN THIS SUB-SECTIO N SHALL APPLY WHERE- (A) THE ASSESSEE 7 (I) OWNS MORE THAN ONE RESIDENTIAL HOUSE, OTHER THAN THE NEW ASSET, ON THE DATE OF TRANSFER OF THE ORIGI NAL ASSET; OR (II) PURCHASES ANY RESIDENTIAL HOUSE, OTHER THAN THE NEW ASSET, WITHIN A PERIOD OF ONE YEAR AFTER THE DATE O F TRANSFER OF THE ORIGINAL ASSET; OR (III) CONSTRUCTS ANY RESIDENTIAL HOUSE, OTHER THAN THE NE W ASSET, WITHIN A PERIOD OF THREE YEARS AFTER THE DAT E OF TRANSFER OF THE ORIGINAL ASSET; AND (B) THE INCOME FROM SUCH RESIDENTIAL HOUSE, OTHER T HAN THE ONE RESIDENTIAL HOUSE OWNED ON THE DATE OF TRANSFER OF THE ORIGINAL ASSET, IS CHARGEABLE UNDER THE HEAD INCOME FROM HO USE PROPERTY.] EXPLANATIONFOR THE PURPOSES OF THIS SECTION,-- 52[***] 53[***] NET CONSIDERATION, IN RELATION TO THE TRA NSFER OF A CAPITAL ASSET, MEANS THE FULL VALUE OF THE CONSIDERATION RE CEIVED OR ACCRUING AS A RESULT OF THE TRANSFER OF THE CAPITAL ASSET AS REDUCED BY ANY EXPENDITURE INCURRED WHOLLY AND EXCLUSIVELY IN CONNECTION WITH SUCH TRANSFER. 7.3 IN EXPLANATION TO SECTION 54F(1), IT IS MENTION ED THAT NET CONSIDERATION MEANS THE FULL VALUE OF CONSIDERATION RECEIVED OR ACCRUING AS A RESULT OF THE TRANSFER OF THE CAPITAL ASSET AS REDUCED BY ANY EXPENDITURE INCURRED WHOLLY AND EXCLUSIVELY IN CONNECTION WITH SUCH TRANSFER. THE MEANING OF FULL VALUE OF CO NSIDERATION IN EXPLANATION 54F(1) WILL NOT BE GOVERNED BY MEANING OF WORD OF FULL VALUE OF CONSIDERATION AS MENTIONED IN SECTION 50C. THE VALUE ADOPTED FOR STAMP DUTY IS TO BE CONSIDERED AS FULL VALUE OF CONSIDERATION FOR THE PURPOSE OF COMPUTING THE CAPI TAL GAINS U/S 48. SECTION 54F(1) SAYS THAT CAPITAL GAINS IS TO BE DEA LT WITH IN ACCORDANCE WITH THE PROVISIONS OF SUB-SECTION (A) A ND (B) OF SECTION 54F(1) OF THE ACT. IN THE INSTANT CASE , TH E COST OF NEW ASSET IS NOT LESS THAN THE NET CONSIDERATION THEN THE WHO LE OF THE CAPITAL GAINS WILL NOT BE CHARGED EVEN IF THE CAPITAL GAINS HAS BEEN 8 COMPUTED BY ADOPTING THE VALUE ADOPTED BY STAMP REG ISTRATION AUTHORITY. IT IS CLEARLY MENTIONED IN SECTION 54F(4 ) ALSO THAT NET CONSIDERATION WHICH IS NOT APPROPRIATED TOWARDS THE PURCHASE OF NEW ASSET THEN THE SAME IS TO BE TAXED IN CASE SUCH NET CONSIDERATION NOT APPROPRIATED IS NOT DEPOSITED IN THE CAPITAL GAIN ACCOUNT. IT IS NOT NECESSARY THAT THE NEW ASSET SHO ULD BE GOT REGISTERED BEFORE FILING OF THE RETURN. THE REQUIRE MENT OF LAW IS THAT NET CONSIDERATION IS REQUIRED TO BE APPROPRIATED TO WARDS THE PURCHASE OF THE NEW ASSET. THUS DEDUCTION U/S 54F I S CLEARLY APPLICABLE. 7.4 WE HAVE ALSO CONSIDERED THE DECISION OF HON'BLE MUMBAI HIGH COURT IN THE CASE OF CIT VS. ACE BUILDERS (P) LTD, SUPRA. SECTION 50 OF THE INCOME TAX ACT PROVIDES THAT CAPI TAL GAINS ON SALE OF DEPRECIABLE ASSET IS TO BE DEEMED AS SHORT TERM CAPITAL GAINS . THE HON'BLE MUMBAI HIGH COURT HAS HELD THAT FICTIO N LIMITED TO SECTION 50 WILL APPLY TO COMPUTATION OF CAPITAL GAI NS AND NOT TO EXEMPTION PROVISIONS. FOR ALLOWING DEDUCTION U/S 54E, ONE WILL HAVE NO DISTINCTION BETWEEN DEPRECIABLE ASSET AND N ON-DEPRECIABLE ASSET. HENCE, IT IS CLEAR THAT DEEMING FICTION MENT IONED IN ONE SECTION WILL NOT AUTOMATICALLY APPLY TO ALL THE PRO VISIONS. IN CASE DEEMING FICTION HAS BEEN CREATED IN SPECIFIC PROVIS ION OF THE ACT THEN HON'BLE GAUHATI HIGH COURT IN THE CASE OF CI T VS. ASSAM PETROLEUM (P) LTD 262 ITR 587 ALSO HELD THAT SECTIO N 54E IS NOT CONTROLLED BY SECTION 50. HENCE DEEMING PROVISIONS AS MENTIONED IN SECTION 50C WILL NOT BE APPLICABLE TO SECTION 54 F SO FAR AS THE MEANING OF FULL VALUE CONSIDERATION IS CONCERNED AS DEEMING PROVISION MENTIONED IN SECTION 50C IS FOR SPECIFIC ASSET AND FOR THE PURPOSE OF SECTION 48 OF I.T. ACT, 1961. 7.5 WE ARE AWARE THAT HON'BLE APEX COURT IN THE CA SE OF GOETZE (INDIA) LTD VS. CIT , 284 ITR 323 HAS HELD T HAT THE AO HAS NO POWER TO ENTERTAIN A CLAIM MADE OTHERWISE THAN B Y WAY OF 9 REVISED RETURN . IT WAS MADE CLEAR THAT THE DECISIO N IS RESTRICTED TO THE POWER OF THE AO TO ENTERTAIN THE CLAIM FOR DEDU CTION OTHERWISE THAN BY REVISED RETURN AND DID NOT IMPINGE ON THE P OWER OF THE APPELLATE TRIBUNAL U/S 254 OF THE ACT. REFERENCE HA S BEEN MADE TO THE DECISION OF NATIONAL THERMAL POWER COMPANY LTD VS. CIT 229 ITR 383 (SC). IN THE INSTANT CASE , THE ASSESSE E HAS CLAIMED THE DEDUCTION U/S 54F BEFORE THE LD. CIT(A) AND THE LD. CIT(A) HAS ENTERTAINED SUCH CLAIM. THEREFORE, THE ISSUE OF CLA IM CAN BE CONSIDERED. HENCE WE HOLD THAT THE ASSESSEE IS ENTI TLED FOR DEDUCTION U/S 54F OF THE ACT. ALTERNATIVELY, THE CL AIM OF THE ASSESSEE IN RESTRICTING THE CAPITAL GAINS TO THE EX TENT OF RS. 1,39,377/- IS CORRECT. SINCE WE ARE HOLDING THAT TH E ASSESSEE IS ENTITLED TO GET DEDUCTION FOR THE ENTIRE CAPITAL GA INS U/S 54F, THEREFORE, THE ALTERNATIVE CLAIM IS NOT CONSIDERED. 8. WE FIND SIMILAR FACTS ARE INVOLVED IN THE PRESEN T CASE. ASSESSEE HAS RECEIVED SALE CONSIDERATION OF RS. 40,00,000/- WHICH HAS BEEN INV ESTED IN THE BONDS IN VIEW OF PROVISIONS OF SECTION 54EC. THEREFORE, ASSESSEE IS ENTITLED FOR DEDUCTION UNDER SECTION 54F. THE PROVISIONS OF SECTION 50C ARE APPLICABLE FOR THE PURPOSES OF SECTION 48 AND FOR THE PURPOSE OF SECTION 54F AS HELD BY THE TRIBUNAL IN CASE OF GYAN CHAND BATRA (SUPRA). FINDINGS OF TRIBUNAL HAVE BEEN REPRODUCED SOMEWHERE ABOVE IN THIS ORDER WHICH WERE TAKEN IN ITA NO. 9/JP/2010 FOR ASSESSMENT YEAR 2006 -07. SIMILAR VIEW HAS BEEN EXPRESSED BY THE BANGALORE BENCH OF THE TRIBUNAL IN CASE OF GOULI MAHADEVAPPA (SUPRA). SINCE ENTIRE AMOUNT OF SALE CONSIDERATION HAS BEEN INVESTED IN BONDS, THEREFORE, IN OUR VIEW PROVISIONS OF SECTION 50C ARE NOT APPLICABLE A S HELD BY JAIPUR BENCH AND BANGALORE BENCH. RESPECTFULLY FOLLOWING THE DECISIONS OF THE TRIBUNAL, WE HOLD THAT AO AND LD. CIT (A) WERE NOT JUSTIFIED IN INVOKING PROVISIONS O F SECTION 50C AND ALTERNATIVELY THE 10 CAPITAL GAIN SHOWN BY ASSESSEE. ACCORDINGLY THE AD DITION MADE AND SUSTAINED BY THE LOWER AUTHORITIES IS DELETED. 9. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWED . 10. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 18 .11.2011. SD/- SD/- ( N.L. KALRA ) ( R.K. GUPTA ) ACCOUNTANT MEMBER JUDICIAL MEMBER JAIPUR, D/ COPY FORWARDED TO :- SHRI PRAKASH KARNAWAT, JAIPUR. THE ITO WARD 6(2), JAIPUR. THE CIT (A) THE CIT THE D/R GUARD FILE (ITA NO. 364/JP/2011) BY ORDER, AR ITAT JAIPUR.