ITO 20(3)(4), MUMBAI V. VIJAYA R. GOYAL, MUMBAI

ITA 3675/MUM/2013

• Counselvise Citation: [2014] 120 COUNSELVISE.COM (IT) 8002 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2008-2009
• Appeal Filed On: 09-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'F' BENCH, MUMBAI BEFORE SHRI D. MANMOHAN, VICE PRESIDENT AND SHRI B.R. BASKARAN, ACCOUNTANT MEMBER ITA NO. 3675/MUM/2013 (ASSESSMENT YEAR: 2008-09) INCOME TAX OFFICER-20(3)(4) VS. MS. VIJAYA R. GOYAL PIRAMAL CHAMBERS LALBAUG, PAREL MUMBAI 400012 506, B-WING, AAKANKSHA CO-OP HSG. SOCIETY, PANCH MARG VERSOVA, ANDHERI (W), MUMBAI PAN - AEPPG2914Q APPELLANT RESPONDENT APPELLANT BY: SHRI SUNIL KUMAR SINGH RESPONDENT BY: NONE DATE OF HEARING: 18.08.2014 DATE OF PRONOUNCEMENT: 18.08.2014 O R D E R PER D. MANMOHAN, V.P. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER PASSED BY THE CIT(A)-31, MUMBAI AND IT PERTAINS TO AY 2008-09. 2. THE ONLY GROUND URGED BEFORE US READS AS UNDER: - 1. THE LEARNED CIT(A) HAS ERRED ON THE FACTS AND C IRCUMSTANCES AND IN LAW IN DIRECTING THE AO TO ALLOW EXEMPTION U/S 5 4 OF THE I.T. ACT IN RESPECT OF BOTH FLATS IGNORING THE PROVISIONS OF SECTION 54 OF THE I.T. ACT AS PER WHICH THE ASSESSEE IS ELIGIBLE FOR EXEMPTION IN RESPECT OF PURCHASE OF ONE RESIDENTIAL UNIT. IN THE INSTANT CASE THE ASSESSEE HAS PURCHASED TWO FLATS VIDE SEPARATE AGRE EMENTS AND THUS WAS ALLOTTED EXEMPTION IN RESPECT OF ONLY ONE RESIDENTIAL UNIT BY THE AO. 3. NONE APPEARED ON BEHALF OF THE ASSESSEE. WE HAVE HE ARD THE LEARNED D.R. AND CAREFULLY EXAMINED THE RECORD. 4. FACTS NECESSARY FOR DISPOSAL OF THE APPEAL ARE STAT ED IN BRIEF. THE ASSESSEE, AN INDIVIDUAL, SOLD HER RESIDENTIAL FLAT AND INVESTED THE SALE CONSIDERATION IN PURCHASE OF TWO ADJACENT FLATS. AC CORDING TO THE AO BENEFIT OF SECTION 54 IS AVAILABLE ONLY WITH REGARD TO PURC HASE OF ONE FLAT AND ACCORDINGLY RESTRICTED THE DEDUCTION TO THAT EXTENT . MS. VIJAYA R. GOYAL 2 5. ON THE OTHER HAND, THE CASE OF THE ASSESSEE IS THAT SHE HAS PURCHASED TWO ADJACENT FLATS, NAMELY, FLATS NO. 707 AND 708 A ND THEY ARE UTILISED AS ONE PROPERTY AND HENCE IT HAS TO BE TREATED AS ONE RESIDENTIAL HOUSE. THE LEARNED CIT(A) OBSERVED THAT THE ASSESSEE PURCHASED TWO ADJACENT FLATS, WHICH ARE CONVERTED INTO A SINGLE DWELLING UNIT WIT HOUT ANY SEPARATING WALL. BY PLACING RELIANCE UPON THE DECISION OF THE ITAT S PECIAL BENCH IN THE CASE OF ITO VS. SUSHILA M. JHAVARI 107 ITD 327 AND ALSO THE DECISION OF THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CIT VS. D. ANANDA PASAPPA 309 ITR 321 HE WAS OF THE FIRM VIEW THAT SO LONG AS TWO FLATS ARE MODIFIED AS TO BE USED AS ONE, EXEMPTION IS AVAILABLE ON THE VALUE OF BOTH THE FLATS. HE DIRECTED THE AO ACCORDINGLY. AGGRIEVED, REVENUE IS IN APPEAL BEFORE US. 6. AT THE TIME OF HEARING THE LEARNED D.R. DID NOT DIS PUTE THE FACTUAL MATRIX OF THE CASE. IT IS ALSO NOT IN DISPUTE THAT ON IDENTICAL CIRCUMSTANCES THE SPECIAL BENCH OF ITAT, IN THE CASE OF SUSHILA M . JHAVARI, HAD ALREADY TAKEN A VIEW THAT IF TWO FLATS ARE CONVERTED INTO O NE RESIDENTIAL UNIT IT SHOULD BE TREATED AS ONE RESIDENTIAL HOUSE AND CONSEQUENTL Y ASSESSEE WOULD BE ENTITLED TO EXEMPTION. NO CONTRARY DECISION WAS PL ACED BEFORE US BY THE REVENUE. HAVING REGARD TO THE CIRCUMSTANCES WE UPHO LD THE ORDER PASSED BY THE LEARNED CIT(A) AND DISMISS THE APPEAL FILED BY THE REVENUE. ORDER PRONOUNCED IN THE OPEN COURT ON 18 TH AUGUST, 2014. SD/- SD/ (B.R. BASKARAN) (D. MANMOHAN) ACCOUNTANT MEMBER VICE PRESIDENT MUMBAI, DATED: 18 TH AUGUST, 2014 COPY TO: THE APPELLANT 1. THE RESPONDENT 2. THE CIT(A) 31, MUMBAI 3. THE CIT 20, MUMBAI CITY 4. THE DR, F BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.