Shri Subhash Chandra Nema, Indore V. The ACIT 3(1), Indore

ITA 426/IND/2013

• Counselvise Citation: 42622714 RSA 2013
• Duration Of Justice: 1 year(s) 3 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-09-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 10-06-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R A VERMA
• Keywords: Capital asset
• Section: 143(3); 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE P.K. BANSAL, ACCOUNTANT MEMBER AND SHRI MUKU L KR. SHRAWAT, JUDICIAL MEMBER PAN NO. AAWPN2874K ITA NO. 423/IND/2013 A.Y. : 2009-10 SHRI HEMANT KUMAR NEMA, 45,KESHAR BAGH, INDORE. VS. ACIT, 3(1), INDORE (APPELLANT) (RESPONDENT) PAN NO. AAWPN2877L ITA NO. 424/IND/2013 A.Y. : 2009-10 SHRI VIJAY KUMAR NEMA, 45,KESHAR BAGH, INDORE. VS. ACIT, 3(1), INDORE (APPELLANT) (RESPONDENT) PAN NO. AAOPN1964C ITA NO. 425/IND/2013 A.Y. : 2009-10 SHRI GOPAL DAS NEMA, 45,KESHAR BAGH, INDORE. VS. ACIT, 3(1), INDORE (APPELLANT) (RESPONDENT) S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 2 PAN NO. AAWPN2873Q ITA NO. 426/IND/2013 A.Y. : 2009-10 SHRI SUBHASH CHANDRA NEMA, 45,KESHAR BAGH, INDORE. VS. ACIT, 3(1), INDORE (APPELLANT) (RESPONDENT) APPELLANT S BY : SHRI SUMIT NEMA, ADV. RE SPONDENT BY : SHRI R. A. VERMA, SR. DR / // / DATE OF HEARING : 15.09.2014 /DATE OF PRONOUNCEMENT: 19.09.2014. / O R D E R PER P.K.BANSAL, A.M. SINCE ALL THESE APPEALS INVOLVE COMMON ISSUE, THERE FORE, ALL THESE APPEALS FILED BY THE DIFFERENT ASSESSEES OF S AME GROUP ARE DISPOSED OF BY THIS COMMON ORDER. 2. IN I.T.A.NOS. 423, 424 & 426/IND/2013, SINCE GROUND NO. 1 IS NOT PRESSED, STANDS DISMISSED, AS NOT PRESSED. IN I.T.A.NO. 425/IND/2013 SINCE GROUND NO. 2 IS NOT PRESSED, STA NDS DISMISSED, AS NOT PRESSED. 3. IN I.T.A.NO. 425/IND/2013, THE ASSESSEE HAS TAKEN T HE FOLLOWING GROUND :- S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 3 THAT THE CIT(A) ERRED ON FACTS AND IN LAW IN UPHOLDING THE ASSESSMENT ORDER DATED 30.12.2011 PASSED BY THE ASSESSING OFFICER U/S 143(3) OF THE INCOME-TAX ACT, 1961, (THE ACT) WITHOUT APPRECIAT ING THAT THE SAID ORDER WAS WITHOUT JURISDICTION, NON-E ST AND VOID AB-INITIO IN AS MUCH AS THE SAME WAS PASSE D IN THE NAME OF THE DECEASED ASSESSEE. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CONSIDERED THE SAME. WE NOTED THAT THIS IS A FACT T HAT SHRI GOPALDAS NEMA IN WHOSE NAME ASSESSMENT HAS BEEN MAD E ALREADY DIED ON 1.3.2009. THE NOTICE U/S 143(2) WAS ALSO SERVED I THE NAME OF SHRI GOPAL DAS NEMA. THE ASSESSING OFFI CER EVEN THEN WITHOUT INCLUDING THE LEGAL HEIR COMPLETED THE ASSESSMENT ON THE DECEASED PERSON WHO WAS NO MORE IN EXISTENCE EVEN AS ON THE DATE OF THE ORDER I.E. 30.12.2011. THE ASSESSEE HAS TAKEN A SPECIFIC GROUND IN THIS APPEAL BEING GROUND NO.2 BE FORE THE CIT(A). THE LD. CIT(A) TOOK THE VIEW THAT IT WAS DU TY OF THE LEGAL HEIR OF THE ASSESSEE TO BRING THE FACT OF THE DEATH TO THE NOTICE OF THE ASSESSING OFFICER ALONGWITH THE ADDRESS OF THE LEGAL HEIR WITH DOCUMENTARY PROOF OF BEING A LEGAL HEIR. THE LD. AU THORIZED REPRESENTATIVE BEFORE US EVEN THOUGH VEHEMENTLY CON TENDED BUT DID NOT PRODUCE ANY COGENT MATERIAL OR EVIDENCE WHI CH MAY PROVE THAT THE ASSESSEE HAS INFORMED THE DEPARTMENT ABOUT THE DEATH OF SHRI GOPAL DAS. FROM THE ASSESSMENT ORDER, IT AP PEARED THE S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 4 RETURN HAD BEEN FILED THROUGH E-FILING BY SHRI GOPA L DAS. EVEN THOUGH THE APPEAL BEFORE THE CIT(A) HAS BEEN FILED IN FORM NO. 35 BY THE LEGAL HEIR ON BEHALF OF LATE SHRI GOPAL DAS. NO EVIDENCE WAS BROUGHT TO OUR KNOWLEDGE TO CONTRADICT THIS FAC T THAT THE RETURN WAS FILED BY THE LEGAL REPRESENTATIVE ON BEH ALF OF LATE SHRI GOPAL DAS, IN THE SUBMISSION AND STATEMENT OF FACTS . BEFORE THE CIT(A), THE ASSESSEE STATES THAT THE INCOME TAX RET URN FOR THE ASSESSMENT YEAR 2009-10 WAS FILED BY THE ASSESSEE O N 29.9.2009 BY E-FILING. THE ASSESSEE DOES NOT STATE THE FACT T HAT THE RETURN WAS FILED BY THE LEGAL HEIR SHRI GOPAL DAS NEMA. TH IS FACT THAT THE ASSESSEE HAS EXPIRED HAS ALSO BEEN STATED BEFOR E THE CIT(A) BY WAY OF TAKING GROUND NO.2. UNDER THESE FACTS AND CIRCUMSTANCES, WE DO NOT FIND ANY MERIT IN THE GROU ND TAKEN BY THE ASSESSEE AS IT CAN AT THE MOST BE REGARDED TO B E AN IRREGULARITY NOT THE ILLEGALITY. WE, THEREFORE, DIS MISS THIS GROUND. 5. GROUND NO. 2 IN I.T.A.NO. 423/IND/2013, GROUND NO. 2 IN I.T.A.NO. 424/IND/2013, GROUND NO. 3 IN I.T.A.NO . 425/IND/2013 AND GROUND NO. 2 IN I.T.A.NO. 426/IND/ 13, BOTH THE PARTIES AGREED, IS THE COMMON GROUND AND WHATEV ER VIEW THIS TRIBUNAL MAY TAKE ON THE BASIS OF GROUND NO.2 IN I .T.A.NO. S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 5 423/IND/2013, THE SAME VIEW MAY BE TAKEN IN THE OTH ER APPEAL. THIS GROUND READS AS UNDER :- 2. THAT THE LD. CIT(A) ERRED ON FACTS AND IN LAW IN UPHOLDING THE ACTION OF THE ASSESSING OFFICER IN DENYING EXEMPTION TO THE EXTENT OF RS. 50 LACS CLAIMED BY APPELLANT U/S 54EC OF THE ACT IN RESPECT OF THE INVESTMENT MADE IN REC BONDS ON 31.03.2008 HOLDING THAT THE SAID INVESTMENT WAS MADE BEFORE THE DATE OF TRANSFER OF THE PROPERTY. 6. WE, THEREFORE, DECIDE TO DISPOSE OF THE GROUND IN I.T.A.NOS. 423 TO 426/IND/2013 ON THE BASIS OF THE FACTS RELATING TO I.T.A.NO. 423/IND/2013 IN THE CASE OF SHRI HEMAN T KUMAR NEMA. 7. THE BRIEF FACTS OF THE CASE RELATING TO THESE GROUN DS ARE THAT THE ASSESSING OFFICER NOTED THAT THE ASSESSEE INVESTED A SUM OF RS. 50 LACS IN RURAL ELECTRIFICATION BOND (REC) AND CLAIMED IT AS DEDUCTION U/S 54EC. THE ASSESSING OFFICER NOTED THAT THE INVESTMENT IN REC BOND WAS MADE DURING THE FINANCIA L YEAR RELEVANT TO THE ASSESSMENT YEAR. THE ASSESSEE WAS N OT ELIGIBLE FOR DEDUCTION UNDER THE SAID SECTION AS THE INVESTMENT IN SPECIFIED BOND WAS REQUIRED TO BE MADE AFTER THE CAPITAL ASSE T IS TRANSFERRED. THE ASSESSING OFFICER, THEREFORE, REOP ENED THE ASSESSMENT AND ALLOWED THE EXEMPTION U/S 54EC. IT W AS ALSO NOTED BY HIM THAT THE ASSESSEE WAS ONE OF THE OWNER S OF THE S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 6 PROPERTY AT KESHAR BAGH ROAD WITH SHRI GOPALDAS NEM A AND SHRI SUBHASH CHANDRA NEMA, THE PROPERTY WAS SOLD FOR A CONSIDERATION OF RS. 7 CRORES TO M/S. BRIJ REAL EST ATE, THE SHARE OF EACH OF THE COOWNER WAS RS. 1.75 CRORES AND AGAI NST WHICH EACH OF THE OWNER INVESTED IN REC BOND ON 25.3.2008 . THE TRANSFER OF THE PROPERTY HAS TAKEN PLACE SUBSEQUENT TO THE INVESTMENT ALTHOUGH EACH OF THE OWNER HAS RECEIVED ADVANCES PRIOR TO THE DATE OF INVESTMENT AGAINST THE SALE OF THE SAID PROPERTY. 8. THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A). THE LD. CIT(A) NOTED FROM THE COPY OF THE AGREEMENT FILED B Y THE ASSESSEE THAT THE AGREEMENT TO SALE IS DATED 22.1.2008 AND T HE SCHEDULE OF THE PAYMENT AS PER THE AGREEMENT WAS AS UNDER : CHEQUE NO. 501186 DATED 22.1.2008 RS.95,00,000 CHEQUE NO. 501182 DATED 24.1.2001 RS. 80,000/- PAYMENT TO BE MADE TILL 01.05.2008 AS PER CONVENIENCE RS. 5,25,00,000/- 9. THE ASSESSING OFFICER, THEREFORE, TOOK THE VIEW THA T THE TRANSFER HAS NOT TAKEN PLACE BEFORE 25 TH MARCH, 2008 I.E. THE DATE OF INVESTMENT OF RS. 50 LACS IN REC BOND BY EACH OF THE COOWNER. HE, THEREFORE, CONFIRMED THE ORDER OF THE ASSESSING OFFICER. S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 7 10. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY CONSIDERED THE SAME ALONGWITH THE ORDERS OF THE TAX AUTHORITIES BELOW AS WELL AS THE SUBMISSIONS MADE BEFORE US FRO M BOTH THE SIDES. WE NOTED THAT THIS IS AN UNDISPUTED FACT THA T ALL THE FOUR ASSESSEES ENTERED INTO AN AGREEMENT WITH SHRI DEEPA K S/O SHRI NANAK RAM JI KALRA, R/O 6, SHRIRAM NAGAR, INDORE, F OR THE SALE OF SURVEY NO. 1465 MEASURING 1.49 ACRES SITUATED AT KESHAR BAGH ROAD, INDORE, PROPERTY FOR A CONSIDERATION OF RS. 7 CRORES. AS PER THE TERMS CLAUSE (2) OF AGREEMENT, THE CONSIDERATIO N HAS TO BE PAID AS UNDER :- CHEQUE NO.501186 DATED 22.1.2008 95,00,000/- CHEQUE NO. 501182 DATED 24.1.2001 80,000/- PAYMENT TO BE MADE TILL 01.05.2008 AS PER CONVENIENCE RS. 5,25,00,000/- 11. SUBSEQUENTLY, THE POSSESSION LETTER WAS EXECUTED ON 25.03.2008 AND AS PER CLAUSE (2) OF THE POSSESSION LETTER, THE COPY OF WHICH IS AVAILABLE FROM PAGES 51 TO 56. AS NOTARIZED, IT WAS MENTIONED THAT AS ON THAT DATE EACH OF THE OWNE R HAS DELIVERED POSSESSION TO THE BUYER AS ON 25.2.2008. AS ON THAT DATE, THE CONSIDERATION WAS PAID BY ISSUING THE FOL LOWING CHEQUES IN FAVOUR OF THE RESPECTIVE COOWNERS : S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 8 (I) SHRI HEMANT KUMAR NEMA : RS. 50,00,000/- BY CHEUQE NO. 573711 DATED 25.3.2 008 OF UNION BANK RECEIVED FROM DEEPAK KALRA. RS. 75,00,000/- BY CHEQUE NO. 573727 DATED 10.04. 08 OF UNION BANK RECEIVED FROM DEEPAK KALRA. RS. 50,00,000/- BY CHEQUE NO. 573728 DATED 10.04 .08 OF UNION BANK RECEIVED FROM DEEPAK KALRA. ____________________ RS. 1,75,00,000-00 (II) SHRI VIJAY KUMARJI NEMA : RS. 50,00,000/- BY CHEUQE NO. 573712 DATED 27.3.2 008 OF UNION BANK RECEIVED FROM DEEPAK KALRA. RS. 75,00,000/- BY CHEQUE NO. 573729 DATED 10.04. 08 OF UNION BANK RECEIVED FROM DEEPAK KALRA. RS. 50,00,000/- BY CHEQUE NO. 573730 DATED 10.04 .08 OF UNION BANK RECEIVED FROM DEEPAK KALRA. ____________________ RS. 1,75,00,000-00 (III) SHRI GOPALDAS JI NEMA : RS. 75,00,000/- BY CHEUQE NO. 501186 DATED 22.1.2 008 OF UNION BANK RS. 50,00,000/- BY CHEQUE NO. 573725 DATED 10.04. 08 OF UNION BANK RECEIVED FROM DEEPAK KALRA. RS. 50,00,000/- BY CHEQUE NO. 573728 DATED 10.04 .08 OF UNION BANK RECEIVED FROM DEEPAK KALRA. ____________________ RS. 1,75,00,000-00 S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 9 (IV) SHRI SUBHASHCHANDRA JI NEMA : 1,75,00,000/- BY CHEQUE NO. 573704 DATED 0 4.03.2008 OF UNION BANK RECEIVED FROM DEEPAK KALRA. ____________________ RS. 1,75,00,000-00 12. IN VIEW OF THE AFORESAID POSSESSION LETTER EXECUTED AS ON 25.3.2008, IT IS APPARENT THAT EACH OF THE COOWNER HAD RECEIVED MORE THAN RS. 50 LAKHS ON 25.3.2008. THE EACH OF TH E COOWNER HAD RECEIVED MORE THAN RS. 50 LAKHS ON 25.3.2008. T HE EACH OF THE COOWNER HAS ISSUED THE CHEQUE FOR PURCHASE OF T HE BOND. OUT OF THE PART OF THE CONSIDERATION RECEIVED EACH OF T HE SELLER. THE BONDS WERE ULTIMATELY ALLOTTED TO EACH OF THE COOWN ER ON 31.3.2008. THEREFORE, THIS REMAINS AN UNDISPUTED FA CT THAT THE INVESTMENTS ARE MADE IN THE REC BOND. OUT OF THE PA RT OF THE CONSIDERATION RECEIVED FOR THE SALE OF THE AFORESAI D PROPERTY. THIS IS ALSO FACT THAT THE REVENUE HAS ASSESSED THE CAPI TAL GAINS IN RESPECT OF THE SAID PROPERTY IN THE HANDS OF THE EA CH OF THE COOWNER IN THE AFORESAID ASSESSMENT YEAR IN VIEW OF THE S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 10 PROVISIONS OF SECTION 2(47). THE ONLY CONTENTION OF THE REVENUE BEFORE US IS THAT SINCE THE PROVISIONS OF SECTION 5 4EC SPECIFICALLY PROVIDES THAT THE DEDUCTION U/S 54EC HAS TO BE MADE IF THE INVESTMENTS ARE MADE WITHIN A PERIOD OF SIX MONTHS AFTER THE DATE OF SUCH TRANSFER. IN THIS REGARD, THE ASSESSEE HAS RELIED ON THE FOLLOWING CIRCULAR ISSUED BY THE DEPARTMENT, WH ICH READS AS UNDER :- CIRCULAR NO. 359 DATED 10 TH MAY, 1983. SUB : SECTION 54E WHETHER THE INVESTMENT OF EARN EST MONEY OR ADVANCE RECEIVED IN SPECIFIED ASSETS BEFOR E THE DATE OF TRANSFER VITIATES CLAIM FOR EXEMPTION CLARIFICATION REGARDING. SECTION 54E OF THE INCOME-TAX ACT, 1961, PROVIDES FOR EXEMPTION OF LONG-TERM CAPITAL GAINS I F THE NET CONSIDERATION IS INVESTED BY THE ASSESSEE IN SPECIFIED ASSETS WITHIN A PERIOD OF SIX MONTHS AFTE R THE DATE OF SUCH TRANSFER. A TECHNICAL INTERPRETATION O F SECTION 54E COULD MEAN THAT THE EXEMPTION FROM TAX ON CAPITAL GAINS WOULD NOT BE AVAILABLE IF PART OF THE CONSIDERATION IF INVESTED PRIOR TO THE DATE OF EXEC UTION OF THE SALE DEED AS THE INVESTMENT CANNOT BE REGARD ED AS HAVING BEEN MADE WITHIN A PERIOD OF SIX MONTHS AFTER THE DATE OF TRANSFER. 2. ON CONSIDERATION OF THE MATTER IN CONSULTATION WITH THE MINISTRY OF LAW, IT IS FELT THAT THE FOREG OING INTERPRETATION WOULD GO AGAINST THE PURPOSE AND SPI RIT OF THE SECTION. AS THE SECTION CONTEMPLATES INVESTM ENT OF THE NET CONSIDERATION IN SPECIFIED ASSETS FOR A MINIMUM PERIOD AND AS EARNEST MONEY OR ADVANCE IS A PART OF THE SALE CONSIDERATION, THE BOARD HAVE DECI DED THAT IF THE ASSESSEE INVESTS THE EARNEST MONEY OR T HE ADVANCE RECEIVED IN SPECIFIED ASSETS BEFORE THE DAT E OF S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 11 TRANSFER OF ASSETS, THE AMOUNT SO INVESTED WILL QUA LIFY FOR EXEMPTION UNDER SECTION 54E OF THE INCOME-TAX A CT, 1961. YOURS FAITHFULLY, SD/- P.SAXENA SECRETARY, CBDT ( F.NO.207/8/82-ITA.II) 13. FROM THIS CIRCULAR, ALTHOUGH IT IS WITH REFER ENCE TO THE INTERPRETATION OF THE PROVISIONS AS ARE STIPULATED U/S 54E, IT IS APPARENT THAT ALTHOUGH THE WORDING IN THE SECTION A RE SIMILAR TO THE PROVISIONS OF SECTION 54EC THAT THE INVESTMENT IN THE SPECIFIED ASSETS HAS TO BE MADE WITHIN PERIOD OF SI X MONTHS AFTER THE DATE OF SUCH TRANSFER BUT THE BOARD HAS CLEARLY LAID DOWN IN THE CIRCULAR UNDER PARA (2) THAT IN ITS OPTION IT I S FELT THAT IF STATUTORY INTERPRETATION IS TAKEN THAT THE INVESTME NT HAS TO BE MADE AFTER THE DATE OF TRANSFER, THIS INTERPRETATIO N WOULD GO AGAINST THE PURPOSE AND SPIRIT OF THE SECTION. THE SECTION CONTEMPLATES INVESTMENT OF THE NET CONSIDERATION IN THE SPECIFIED ASSETS FOR THE MINIMUM PERIOD AND AS EARNEST MONEY OR ADVANCE IS A PART OF THE SALE CONSIDERATION. THEREFORE, THE BOARD HAVE DECIDED THAT IF THE ASSESSEE INVESTS THE EARNEST MO NEY ON THE ADVANCE RECEIVED IN THE SPECIFIED ASSETS BEFORE THE DATE OF THE TRANSFER OF THE ASSETS, THE AMOUNT SO INVESTED WILL QUALIFY FOR EXEMPTION U/S 54E OF THE INCOME-TAX ACT, 1961. EVEN THOUGH S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 12 THIS CIRCULAR HAS BEEN ISSUED FOR THE PURPOSE OF AV AILING OF THE EXEMPTION U/S 54E, BUT IF WE SEE THE LOGIC AND THE LANGUAGE OF BOTH THE SECTIONS, THE PURPOSE OF ALLOWING THE EXEM PTION TO THE ASSESSEE FOR MAKING THE INVESTMENT IN SPECIFIED ASS ETS IS THAT THE ASSESSEE SHOULD INVEST IN THE SPECIFIED ASSETS OUT OF THE PART OF THE CONSIDERATION RECEIVED BY HIM. ON THE FACTS OF THIS, IT IS APPARENT THAT EACH OF THE ASSESSEE HAS INVESTED INT O THE REC BOND EVEN THOUGH PRIOR TO THE TRANSFER BUT OUT OF T HE PART OF THE CONSIDERATION RECEIVED ON THE SALE OF THE ASSETS IN RESPECT OF WHICH THE CAPITAL GAIN HAS BEEN ASSESSED. 14. WE NOTED THAT THE SIMILAR ISSUE HAS ARISEN BEFORE T HE PUNE BENCH B OF I.T.A.T. IN I.T.A.NO. 1672/PN/2011 AND I.T.A.NO. 152/PN/2012 IN THE CASE OF SUBHASH VINAYA K SUPNEKAR, PUNE, IN WHICH THE HON'BLE TRIBUNAL WHILE ALLOWING THE RELIEF TO THE ASSESSEE HELD AS UNDER :- WE FIND THE CBDT VIDE CIRCULAR NO.359 (F.NO.207/8/ 82- IT(A-LL) DATED 10-05-1983 HAS HELD THAT EARNEST MON EY OR ADVANCE IS A PART OF THE SALE CONSIDERATION AND THE REFORE IF THE ASSESSEE INVESTS THE EARNEST MONEY OR THE ADVAN CE RECEIVED IN SPECIFIED ASSETS BEFORE THE DATE OF TRA NSFER OF THE ASSET, THE AMOUNT SO INVESTED WILL QUALIFY FOR EXEMPTION U/S. 54E. ALTHOUGH IN THE INSTANT CASE TH E ISSUE IS U/S.54EC, HOWEVER, WE FIND THE LANGUAGE IN THE A BOVE SECTION IS SIMILAR TO THAT OF SECTION 54. THEREFORE , WE FIND FORCE IN THE ARGUMENTS OF THE LD. COUNSEL FOR THE A SSESSEE THAT EARNEST MONEY OR ADVANCE MONEY IS A PART OF SA LE CONSIDERATION. S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 13 8.2 WE FIND THE NAGPUR BENCH OF THE TRIBUNAL IN T HE CASE OF BHIKULAL CHANDAK (HUF) V S. ITO 126 TTJ 545 HAS HELD THAT ASSESSEE CANNOT BE TREATED AS DEFAULTER I N MAKING INVESTMENT IN BONDS AS REQUIRED U/S. 54EC ON RECEIPT OF ADVANCE AS PER THE AGREEMENT TO SELL PRO PERTY AND CLAIMING EXEMPTION U/S. 54EC. SO FAR AS THE DEC ISION OF THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF HIN DUSTAN UNILEVER LTD. (SUPRA) RELIED ON BY THE LD. CIT(A) I S CONCERNED WE FIND THE SAME IS DISTINGUISHABLE AND N OT APPLICABLE TO THE FACTS OF THE PRESENT CASE. THE HO N'BLE COURT IN THE SAID CASE HAS HELD THAT FOR THE PURPOS E OF CLAIMING DEDUCTION UNDER THE PROVISIONS OF SECTION 54EC, THE DATE OF INVESTMENT BY THE ASSESSEE MUST BE RECO RDED AS THE DATE ON WHICH PAYMENT WAS MADE AND RECEIVED BY THE NATIONAL HOUSING BANK. SINCE IN THAT CASE THE INVESTMENT WAS WITHIN A PERIOD OF 6 MONTHS FROM THE DATE OF TRANSFER OF THE ASSET THE HON'BLE COURT HELD THA T THE PROVISIONS OF SECTION 54EC WERE COMPLIED WITH BY TH E ASSESSEE. HOWEVER, IN THE INSTANT CASE, THE ISSUE I S REGARDING ADVANCE MONEY RECEIVED ON THE BASIS OF AGREEMENT TO SALE AND THE APPLICABILITY OF SECTION 54EC ON ACCOUNT OF INVESTMENT IN SPECIFIED BOND OUT OF ADVA NCE MONEY BUT BEFORE THE DATE OF ACTUAL SALE. THEREFORE , THE SAID DECISION IS NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE. WE ALSO DO NOT FIND FORCE IN THE SUBMISSION O F THE LD. DEPARTMENTAL REPRESENTATIVE THAT THE ACT DOES NOT CONTEMPLATE ANY ADVANCE AND THAT THE CBDT CIRCULAR NO.359 DATED 10-05-1983 IS NOT APPLICABLE TO THE FA CTS OF THE PRESENT CASE. 15. RESPECTFULLY FOLLOWING THE AFORESAID DECISION AND I N VIEW OF OUR DISCUSSION, IN THE PRECEDING PARAGRAPHS, WE SET-ASIDE THE ORDER OF THE CIT(A) ON THIS ISSUE AND ALLOW THE GRO UND TAKEN BY THE ASSESSEE AND DIRECT THE ASSESSING OFFICER TO AL LOW DEDUCTION TO ALL THE ASSESSEES U/S 54EC. THUS, ALL THE APPEAL S FILED BY THE ASSESSEES ARE PARTLY ALLOWED. S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 14 16. IN THE RESULT, ALL THE FOUR APPEALS OF THE ASSESSEE S ARE ALLOWED IN PART. SD/- SD/- (MUKUL KR. SHRAWAT) (P. K. BANSAL) JUDICIAL MEMBER ACCOUNTANT M EMBER INDORE; DATED 19/09/2014 CPU*SPS / COPY OF THE ORDER FORWARDED TO : 1. ! / THE APPELLANT 2. '# ! / THE RESPONDENT. 3. $%$&' # # ( / CONCERNED CIT 4. # # ( ( ) / THE CIT(A), INDORE 5. +,# &' , # # &' , -.% / DR, ITAT, INDORE 6. ,/0 1 / GUARD FILE. / BY ORDER, -# -# -# -# $2 $2 $2 $2 (ASSTT.REGISTRAR) ITAT, IND ORE S/SHRI HEMANT KUMAR NEMA, VIJAY KUMAR NEMA, GOPALDA S NEMA AND SUBHASH CHANDRA NEMA I.T.A.NOS. 423, 424, 425 & 426/IND/2013 A.YS. :200 9-10 15 1. DATE OF DICTATION- 16.09.2014 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 17.09.2014 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S. .. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT .. 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : 26 .09.2014 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 8. DATE OF DESPATCH OF THE ORDER