Smt Mukkamala Mayuri, Hyderabad V. The ITO, Ward-1, Narasaraopeta

ITA 438/VIZ/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 50274 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 9 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 25-04-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 30-08-2010
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: D S SUNDER SINGH
• Keywords: Gift; Fair market value
• Section: 54F; 54; 139

Judgement Text

ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 1 OF 9 IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM BENCH, VISAKHAPATNAM BEFORE: SHRI SUNIL KUMAR YADAV, JUDICIAL MEMBER AND SHRI BR BASKARAN, ACCOUNTANT MEMBER ITA NO.438/VIZAG/2010 ASSESSMENT YEAR: 2006-07 SMT. MUKKAMALA MAYURI, NARSARAOPET VS. ITO WARD-1, NARSARAOPET (APPELLANT) PAN NO:ALUPM 4795 R (RESPONDENT) APPELLANT BY: SHRI G.V.N. HARI, CA RESPONDENT BY: SHRI D.S. SUNDER SINGH, SR.DR ORDER PER SHRI B. R. BASKARAN, ACCOUNTANT MEMBER: THE APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER DATED 30.06.2010 PASSED BY LEARNED CIT(A), GUNTUR AND IT RELATES TO THE ASSESSMENT YEAR 2006-07. 2. THE EFFECTIVE GROUNDS OF APPEAL RAISED BY THE AS SESSEE READ AS UNDER: 2. THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING THE ACTION OF THE ASSESSING OFFICER IN ADOPTING THE COST OF TH E PROPERTY AT RS.82,005/- WITHOUT CONSIDERING THE CLAIMS MADE BY THE APPELLANT HEREIN. 3. THE LEARNED CIT (APPEALS) ERRED IN CONFIRMING TH E ACTION OF THE ASSESSING OFFICER IN REJECTION DEDUCTION CLAIME D UNDER SECTION 54F OF THE INCOME-TAX ACT. THE LEARNED CIT (APPEALS) OUGHT TO HAVE SEEN THAT THE CONDITIONS MENTIONED IN SEC.54F ARE SATISFIED AND THAT THE CLAIM FOR DEDUCTION UNDE R SECTION 54F OF RS.23,50,000/- IS ALLOWABLE. 3. THE FACTS NECESSARY FOR THE DISPOSAL OF THE ISSUES ARE STATED IN BRIEF. THE ASSESSEE OBTAINED AC.4.95 CENTS OF LAND BY WAY OF GIFT FROM HER MOTHER ON 01-2-1985. THE ASSESSEE CONVERTED THE SAID LAND INTO HOUSING PLOTS AND ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 2 OF 9 THEY WERE SOLD OVER A PERIOD SPANNING INTO DIFFEREN T ASSESSMENT YEARS. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE F ILED HER RETURN OF INCOME DECLARING SALE OF 14 PLOTS. DURING THE COURSE OF A SSESSMENT PROCEEDING, THE ASSESSING OFFICER COLLECTED THE DETAILS OF SALE OF PLOTS FROM THE SUB REGISTRAR OFFICE AND NOTICED THAT THERE WAS DIFFERENCE IN THE NUMBER OF PLOTS SOLD. THE ASSESSEE ALSO MADE ENQUIRIES WITH THE SUB REGIS TRAR OFFICER AND ACCORDINGLY FILED A REVISED COMPUTATION OF CAPITAL GAIN DECLARING SALE OF 43 PLOTS. IN THE REVISED COMPUTATION, THE ASSESSEE CLA IMED EXEMPTION UNDER SECTION 54F AS DETAILED BELOW: A) COST OF ADDITION AND ALTERATION & STAMP DUTY TO THE EXISTING BUILDING (5,37,500 + 1,12,500) - 6,50,000 B) ADVANCES GIVEN TO THE SECOND NEW APARTMENT AT HYDERABAD IN THE NAME OF MOTHER SMT. M. JAYALAKSHMI ON 25.8.06 - RS.10.00 LAKHS AND ON 03-10-2007 & 18-12-2007 RS.7.00 LAKHS - 17,00,000 --------------- 23,50,000 ======== THE ASSESSING OFFICER DECLINED TO GIVE EXEMPTION CL AIMED UNDER SECTION 54F OF THE ACT. THE ASSESSEE CARRIED THE MATTER IN APP EAL BEFORE LEARNED CIT(A) SEEKING RELIEF OF EXEMPTION UNDER SECTION 54 F. BESIDES THE ABOVE, THE ASSESSEE ALSO RAISED A GROUND RELATING TO THE D EDUCTION OF FAIR MARKET VALUE AS ON 1.4.1981 WHILE COMPUTING THE LONG TERM CAPITAL GAIN. 3.1 WITH REGARD TO THE CLAIM OF DEDUCTION OF FA IR MARKET VALUE AS ON 1.4.1981, THE LEARNED CIT(A) NOTICED THAT THE ASSES SEE HERSELF HAD DECLARED THE SAME AS RS.82,005/- IN THE REVISED COM PUTATION AND THE ASSESSING OFFICER HAS ONLY ADOPTED THE SAID AMOUNT FOR THE PURPOSE OF COMPUTATION OF CAPITAL GAIN. ACCORDINGLY THE LEARNE D CIT(A) HELD THAT THE ASSESSEE CANNOT HAVE ANY GRIEVANCE IN THAT REGARD. WITH REGARD TO THE CLAIM OF EXEMPTION UNDER SECTION 54F, THE LEARNED C IT(A) CONCURRED WITH THE VIEWS OF THE ASSESSING OFFICER AND ACCORDINGLY AFFIRMED HIS ORDER ON THIS ISSUE. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE US. ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 3 OF 9 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND CARE FULLY PERUSED THE RECORD. THE FIRST GROUND RELATES TO THE CLAIM OF DEDUCTION OF FAIR MARKET VALUE AS ON 1.4.1981 WHILE COMPUTING THE CAPITAL GAIN. AS OBS ERVED BY LEARNED CIT(A), THE ASSESSEE HERSELF HAS DECLARED THE FAIR MARKET VALUE AS ON 1.4.1981 AT RS.82,005/- IN THE REVISED COMPUTATION OF CAPITAL GAIN FILED DURING THE COURSE OF ASSESSMENT PROCEEDINGS AND THE ASSESSING OFFICER HAS ADOPTED THE SAME AMOUNT. HENCE, THE ASSESSEE SHOUL D NOT HAVE ANY GRIEVANCE OVER THE SAME. ACCORDINGLY WE REJECT THE SAID GROUND OF THE ASSESSEE. 5. THE NEXT GROUND RELATES TO THE CLAIM OF EXEM PTION UNDER SECTION 54F OF THE ACT. THE ASSESSEE CLAIMED EXEMPTION UNDER S ECTION 54F IN RESPECT OF TWO PROPERTIES FOR THE FOLLOWING AMOUNTS. (A) COST OF ADDITION AND ALTERATION AND STAMP DUTY ON EXISTING BUILDING RS.6,50,000/-. (B) ADVANCE GIVEN FOR A NEW APARTMENT AT HYDERABAD IN THE NAME OF MOTHER OF ASSESSEE RS.17,00,000/-. 5.1 WITH REGARD TO THE CLAIM OF RS.6,50,000/-, IT WAS NOTICED THAT THE ASSESSEE HAD PURCHASED A FLAT FOR RS.15.00 LAKHS AN D FURTHER INCURRED EXPENSES OF RS.1,12,500/- ON STAMP DUTY AND REGIST RATION. WITH REGARD TO THE COST OF FLAT OF RS.15.00 LAKHS, THE ASSESSEE HA D CLAIMED EXEMPTION UNDER SECTION 54F OF THE ACT IN THE EARLIER TWO YEA RS, I.E. IN ASSESSMENT YEAR 2004-05 A SUM OF RS.6.00 LAKHS AND IN ASSESSMENT YE AR 2005-06 A SUM OF RS.9.00 LAKHS HAD BEEN CLAIMED. IT APPEARS THAT THE ASSESSEE HAD CLAIMED EXEMPTION UNDER SECTION 54F ONLY TO THE EXTENT OF C APITAL GAIN AVAILABLE IN EACH OF THE YEAR. SINCE THE EXEMPTION SO CLAIMED C OULD NOT FULLY COVER THE COST OF THE FLAT, THE ASSESSEE HAS SOUGHT TO CLAIM THE BALANCE AMOUNT OF RS.1,12,500/- THIS YEAR ALONG WITH A SUM OF RS.5,37 ,500/- CLAIMED TO HAVE BEEN INCURRED TOWARDS IMPROVEMENT OF THE FLAT, THUS AGGREGATING TO ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 4 OF 9 RS.6,50,000/-. THE SAID CLAIM OF THE ASSESSEE WAS REJECTED BY LEARNED CIT(A) WITH THE FOLLOWING OBSERVATIONS: 3.3 COMING TO THE QUESTION OF THE AVAILABILITY OF EXEMPTION UNDER SECTION 54F, IT IS SEEN THAT IN THE ASSESSMEN T YEAR 2005-06 THE APPELLANT HAS CLAIMED EXEMPTION UNDER SECTION 54F TO THE EXTENT OF THE CAPITAL GAIN S THAT ACCRUED TO HER IN THAT YEAR. ON THE SAME PROPE RTY, THE APPELLANT HAS NOW SOUGHT TO CLAIM EXEMPTION ON ACCOUNT OF ALTERATION AND ADDITION TO THE EXISTING ASSET AND ALSO ON ACCOUNT OF STAMP DUTY PAID TOWARDS THE EXISTING PROPERTY. 3.4 THE ASSESSING OFFICER HAS CLEARLY OBSERVED IN THE ASSESSMENT ORDER THAT THE ENTIRE AMOUNT OF RS.10,12,500/- WAS PAID AT ONE TIME, WITHIN THE TIM E AVAILABLE FOR FILING THE RETURN OF INCOME UNDER SEC TION 139 FOR THE ASSESSMENT YEAR 2005-06. IN THAT YEAR, T HE APPELLANT HAD ALSO CLAIMED EXEMPTION UNDER SECTION 54F OF THE ACT TO THE EXTENT OF THE CAPITAL GAINS O F RS.9,00,000/-. IT IS THE BALANCE OF RS.1,12,500/- TH AT WAS BEING CLAIMED IN THE ASSESSMENT YEAR 2006-07 SINCE TO THIS EXTENT, CAPITAL GAINS WAS NOT AVAILAB LE IN THE ASSESSMENT YEAR 2005-06. THEREFORE, CONSIDERING THAT THE ENTIRE AMOUNT OF RS.10,12,500/- WAS PAID A T ONE TIME AND TO THE EXTENT OF THE CAPITAL GAINS AVAILABLE, EXEMPTION UNDER SECTION 54F OF THE ACT H AD ALSO ALREADY BEEN CLAIMED IN THE ASSESSMENT YEAR 2005-096, EXEMPTION UNDER SECTION 54F CANNOT AGAIN BE CONSIDERED ON THE AMOUNT OF RS.1,12,500/- PAID TOWARDS STAMP DUTY. 3.5 WITH REGARD TO THE AMOUNT OF RS.5,37,500/- IT WAS STATED THAT THE AMOUNT WAS SPENT TOWARDS ADDITION AND ALTERATION TOWARDS THE EXISTING BUILDING. THERE ARE SEVERAL DECISIONS WHICH HAVE HELD THAT EXTENSION OF EXISTING PROPERTY IS NOT ELIGIBLE FOR EXEMPTION UND ER SECTION 54F OF THE ACT. IN THE CASE OF MEERA JACOB V S. ITO (313 ITR 411), THE KERALA HIGH COURT HELD THAT EXEMPTION UNDER THIS SECTION IS AVAILABLE ONLY IF T HE INVESTMENT IS IN THE CONSTRUCTION OF A HOUSE, AND N OT FOR INVESTMENT IN MODIFICATION OR RENOVATION OF AN EXISTING PROPERTY. 3.6 THE APPELLANT HAS CONTENDED THAT THIS EXPENDITURE W AS INCURRED IN ORDER TO MAKE THE HOUSE INHABITABLE AND ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 5 OF 9 SHOULD THEREFORE, BE ALLO9WED. IT IS SEEN THAT THE EXPENDITURE HAS BEEN INCURRED ON THE FOLLOWING: (I) CUP-BOARDS WITH PLYWOOD, SUNGLASS & GLASS WORK. (II) GRANITE SLABS FOR KITCHEN PLATFORM & TILLING OF WALLS & CHIMNEY FIXING. (III) REPLACEMENT IN THREE BATHROOMS, BATHTUBS, TELEPHONE SHOWERS, WALL TILES UPTO CEILING. (IV) PLASTIC EMULSION PAINTING. 3.7 THE DETAILS OF THE EXPENDITURE CLEARLY REFLECT THAT IT IS NOT TO MAKE THE EXISTING BUILDING HABITABLE, BUT TO MAKE ALTERATIONS AND TO RENDER THE EXISTING FLAT MO RE ATTRACTIVE. AS STATED EARLIER, THE APPELLANT HAD CL AIMED EXEMPTION UNDER SECTION 54F ON THE SAME RESIDENTIAL FLAT IN THE ASSESSMENT YEAR 2005-06. THE APPELLANT S ARGUMENTS THAT THE EXPENDITURE INCURRED IN THE ASSESSMENT YEAR 2006-07 ARE INTENDED TO RENDER THE FLAT INHABITABLE CANNOT BE ACCEPTED, SINCE THE EXEMPTION UNDER SECTION 54F IS ALLOWABLE FOR A RESIDENTIAL PROPERTY AND THIS PRESUPPOSES THAT IT I S INHABITABLE. SINCE THE EXEMPTION UNDER THIS SECTION WAS CLAIMED AND ALLOWED ON THE SAME PROPERTY IN THE ASSESSMENT YEAR 2005-06, IT IS ASSUMED THAT THE FLA T WAS HABITABLE EVEN IN THAT YEAR. THE EXPENDITURE INCURRED IS IN THE NATURE OF ALTERATION AND MODIFIC ATION OF THE EXISTING FLAT, RATHER THAN EXPENDITURE INCUR RED TO RENDER FLAT MORE INHABITABLE. THE MUMBAI BENCH OF T HE ITAT IN THE CASE OF SALEEM FAZALBHAY VS. CIT (291 I TR (AT) 169) HAD HELD THAT THE EXPENDITURE ON MAKING A N EXISTING FLAT INHABITABLE WAS ELIGIBLE FOR EXEMPTIO N UNDER SECTION 54F OF THE ACT. HOWEVER, THE SAME DECISION CLARIFIED THAT THERE IS DISTINCTION BETWE EN EXPENDITURE INCURRED ON MAKING THE HOUSE INHABITABL E AND THE EXPENDITURE ON RENOVATION. WE MAY VISUALIZE A SITUATION WHERE THE ASSESSEE MAY BUY A HABITABLE HOUSE, BUT THE ASSESSEE MAY LIKE TO INCUR EXPENDITU RE BY WAY OF RENOVATION TO MAKE IT MORE COMFORTABLE. H E MAY NOT BE HAPPY WITH THE MATERIAL USED BY THE BUILDER, AND THEREFORE, HE MAY INCUR THE EXPENDITUR E ON IMPROVEMENT OF THE HOUSE. SUCH EXPENDITURE CANNOT BE EQUATED WITH THE EXPENDITURE ON MAKING TH E HOUSE INHABITABLE. ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 6 OF 9 3.8 THE FACTS OF THE APPELLANTS CASE ARE SUCH THAT THE EXPENDITURE OF RS.5,37,500/- INCURRED IN THIS YEAR IS MERELY TO MAKE THE HOUSE MORE COMFORTABLE. THEREFORE, NO EXEMPTION CAN BE ALLOWED UNDER SECTIO N 54F OF THE ACT ON THIS EXPENDITURE. 3.9 FURTHER, THE PROVISO TO SECTION 54F MAKE IT CLEAR T HAT ONCE THE EXEMPTION HAS BEEN CLAIMED IN A PARTICULAR YEAR, THE EXEMPTION IS NOT AVAILABLE ON A NEW ASSET WHICH IS ACQUIRED BY THE APPELLANT WITHIN THE SPECI FIED PERIOD MENTIONED THEREIN. I, THEREFORE, HOLD THAT TH E ASSESSING OFFICER WAS CORRECT IN COMING TO THE CONCLUSION THAT THE APPELLANT WAS NOT ELIGIBLE TO C LAIM EXEMPTION UNDER SECTION 54F ON THE AMOUNT OF RS.6,50,000/-. WE HAVE CAREFULLY PERUSED THE OBSERVATIONS OF LEARN ED CIT(A) AND WE NOTICE THAT THE FIRST APPELLATE AUTHORITY HAS ANALY SED THE CLAIM OF THE ASSESSEE THREAD BARE IN THE LIGHT OF VARIOUS JUDICI AL DECISIONS AND HAS COME TO THE CONCLUSION THAT THE ASSESSEE IS NOT ENTITLED TO CLAIM EXEMPTION UNDER SECTION 54F OF THE ACT IN RESPECT OF THE TYPE OF EX PENSES CLAIMED BY THE ASSESSEE TO THE TUNE OF RS.5,37,500/-. THE LEARNED CIT(A) HAS ALSO NOTICED THAT THE REGISTRATION EXPENSES OF RS.1,12,5 00/- WAS INCURRED ALONG WITH THE AMOUNT OF INVESTMENT CLAIMED UNDER SECTION 54F IN THE EARLIER YEARS. SINCE THE CAPITAL GAIN AVAILABLE IN THAT YE AR WAS NOT SUFFICIENT TO ABSORB THE ENTIRE INVESTMENT, THE ASSESSEE HAD REST RICTED HIS CLAIM UNDER SECTION 54F TO RS.9.00 LAKHS IN THE ASSESSMENT YEAR 2005-06, THOUGH HE HAD SPENT A SUM OF RS.10,12,500/- IN THAT YEAR. THE ASSESSEE SEEKS TO CLAIM EXEMPTION UNDER SECTION 54F IN RESPECT OF THE BALANCE AMOUNT OF RS.1,12,500/-, ALONG WITH CERTAIN EXPENSES TO THE T UNE OF RS.5,37,500/-, WHICH, FOR THE DETAILED DISCUSSIONS MADE BY LEARNED CIT(A), IS NOT IN ACCORDANCE WITH THE SAID PROVISION. DURING THE COUR SE OF HEARING, THE LEARNED AUTHORISED REPRESENTATIVE RELIED UPON FOLLO WING CASE LAW IN SUPPORT OF HIS CONTENTIONS (A) CIT VS. J.R.SUBRAMANYA BHAT (1987 (64 CTR (KAR) 280) (B) B.B.SARKAR VS. CIT (1982) (26 CTR (CAL) 1 3) ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 7 OF 9 WE HAVE GONE THROUGH THE SAID CASE LAW AND IN OUR V IEW; THEY HAVE BEEN RENDERED IN DIFFERENT CONTEXT AND HENCE THEY ARE NO T APPLICABLE TO THE FACTS OF THE CASE UNDER CONSIDERATION. IN VIEW OF THE FO REGOING DISCUSSIONS, WE FULLY CONCUR WITH THE VIEWS EXPRESSED BY THE LEARNE D CIT(A) AND ACCORDINGLY UPHOLD HIS ORDER ON THIS ISSUE. 5.2 THE NEXT CLAIM MADE BY THE ASSESSEE UNDER S ECTION 54F OF THE ACT RELATES TO THE ADVANCE OF RS.17.00 LAKHS PAID BY TH E PARENTS OF THE ASSESSEE. THE LEARNED CIT(A) REJECTED THE SAID CLA IM ALSO WITH THE FOLLOWING OBSERVATIONS: 4.1 THE APPELLANT HAS ALSO CLAIMED EXEMPTION UNDER SECTION 54F ON ADVANCE OF RS.17 LAKHS GIVEN FOR A SECOND NEW APARTMENT IN THE NAME OF THE APPELLANTS MOTHER. THE ASSESSING OFFICER HAS DISALLOWED THIS C LAIM HOLDING THAT SUCH AN EXEMPTION CANNOT BE GRANTED IN VIEW OF PROVISO (III) TO SECTION 54F OF THE ACT. IN THIS CASE THE APPELLANT ALREADY HAD A RESIDENTIAL PROPER TY ON WHICH EXEMPTION UNDER SECTION 54F HAD BEEN CLAIMED BY HER IN THE ASSESSMENT YEAR 2005-06. PROVISO (III) OF SECTION 54F STATES THAT THE EXEMPT ION UNDER SECTION 54F IS NOT AVAILABLE TO AN ASSESSEE W HO CONSTRUCTS ANY RESIDENTIAL HOUSE, OTHER THAN THE N EW 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 THAN THE ONE RESIDENTI AL HOUSE OWNED ON THE DATE OF TRANSFER OF THE ORIGINAL ASSET IS CHARGEABLE UNDER THE HEAD INCOME FROM HOUS E PROPERTY. THE APPELLANT HAS ARGUED THAT NO RENT IS DERIVED FROM THE FIRST PROPERTY AND THEREFORE, THE CONDITION PRESCRIBED IN CLAUSE (B) NAMELY THAT THE INCOME SHOULD BE CHARGEABLE UNDER THE INCOME FROM HOUSE PROPERTY IS NOT SATISFIED IN THIS CASE. 4.2 THIS ARGUMENT OF THE APPELLANT IS NOT ACCEPTABLE SI NCE THERE IS NO REQUIREMENT THAT ACTUAL INCOME SHOULD H AVE BEEN CHARGED TO TAX UNDER THIS HEAD. WHAT THE SECTI ON IMPLIES IS THAT WHERE THE INCOME THAT WOULD BE DERI VED FROM THIS ASSET IS CHARGEABLE UNDER THE HEAD INCOM E FROM HOUSE PROPERTY, THE CONDITIONS PRESCRIBED IN THE SUB-CLAUSE WOULD COME INTO OPERATION. SINCE IN THIS ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 8 OF 9 CASE, ANY INCOME ARISING OUT OF THIS PROPERTY WOULD BE CHARGEABLE UNDER THE HEAD INCOME FROM HOUSE PROPERTY THE CONDITIONS ARE SATISFIED. 4.3 FURTHER IN THIS CASE, THE APPELLANT HAS CLAIMED EXEMPTION ON ADVANCES GIVEN FOR SECOND NEW APARTMENT FOR AN AMOUNT OF RS.17 LAKHS. IT IS SEEN T HAT THE NEW ASSET IS IN THE NAME OF THE APPELLANTS MOT HER AND NOT IN HER OWN NAME. THE APPELLANTS AR FILED VARIOUS SUBMISSIONS AND OTHER EVIDENCES TO SHOW THA T THE APPELLANT WAS NOT IN A CONDITION TO MAINTAIN TH E PROPERTY ON HER OWN AND THEREFORE, THE PROPERTY WAS ACQUIRED IN THE NAME OF HER MOTHER. HOWEVER, IT IS PERTINENT TO NOTE THAT THE APPELLANT IS NOT THE ONL Y HEIR OF HER PARENTS. THERE ARE SEVERAL CASE LAWS WHICH A RE HELD THAT WHERE THE PROPERTY IN QUESTION IS NOT IN THE NAME OF THE ASSESSEE, THE EXEMPTION UNDER SECTION 54F CANNOT BE GRANTED TO THE ASSESSEE. THE BOMBAY HIGH COURT IN THE CASE OF PRAKASH VS. CIT (312 ITR 40) HELD THAT INVESTMENT OF SALE PROCEEDS IN THE NAME O F THE APPELLANTS ADOPTED SON, WOULD NOT BE ELIGIBLE FOR EXEMPTION UNDER SECTION 54F OF THE ACT. THE BOMBAY HIGH COURT HELD THAT FOR QUALIFYING FOR EXEMPTION, IT WAS NECESSARY TO HAVE THE INVESTMENTS IN THE RESIDENTIAL HOUSE, IN THE NAME OF THE ASSESSEE ONLY . A SIMILAR VIEW WAS TAKEN BY THE NAGPUR BENCH OF THE ITAT IN THE CASE OF ITO VS. PRAKASH TIAJI DHANJODE, WHERE THE TRIBUNAL HELD THAT WHERE THE SALE PROCEED S WERE INVESTED IN A PROPERTY IN THE NAME OF THE ASSESSEES SON, NO EXEMPTION WAS AVAILABLE. 4.4 I, THEREFORE, HOLD THAT THE ASSESSING OFFICER WAS CORRECT IN COMING TO THE CONCLUSION THAT THE APPELL ANT WAS NOT ELIGIBLE TO CLAIM EXEMPTION UNDER SECTION 5 4F OF THE ACT ON THE AMOUNT. DURING THE COURSE OF HEARING, THE LEARNED AUTHORISE D REPRESENTATIVE RELIED UPON THE FOLLOWING CASE LAW IN THIS REGARD. (A) CIT VS. V.NATARAJAN (2006) (203 CTR (MAD) 37) (B) NIPUN MEHROTRA VS. ACIT (2008) (113 TTJ (BANG.) 223 ). IN THE FIRST CASE CITED ABOVE, THE ASSESSEE THEREIN HAD PURCHASED A HOUSE PROPERTY IN THE NAME OF HIS WIFE AND THE SAME WAS A LSO ASSESSED IN HIS HANDS. HENCE THE FACTS OF THAT CASE ARE NOT APPLIC ABLE TO THE ASSESSEE ITA NO438 OF 2010 MUKKAMALA MAYURI NARSARAOPET PAGE 9 OF 9 HEREIN. THE SECOND CASE LAW PERTAINS TO THE TIME L IMIT FOR MAKING INVESTMENT, WHICH IS NOT IN DISPUTE HERE. ACCORDING LY, BOTH THE CASE LAW ARE NOT APPLICABLE FOR THE ISSUE UNDER CONSIDERATION. O N A CAREFUL PERUSAL OF THE ORDER OF LEARNED CIT(A), WE NOTICE THAT THE FIRST A PPELLATE AUTHORITY HAS ANALYSED THE ISSUE IN A PROPER MANNER AND HAS TAKEN A CONSCIOUS DECISION. HENCE WE DO NOT FIND ANY INFIRMITY IN THE SAID DECI SION OF LEARNED CIT(A) AND ACCORDINGLY UPHOLD THE SAME. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON 16 TH JUNE, 2011. SD/- SD/- (SUNIL KUMAR YADAV) (B R BASKARAN) JUDICIAL MEMBER ACCOUNTANT MEMBER PVV/SPS VISAKHAPATNAM, DATE:16-06-2011 COPY TO 1 SMT. MUKKAMALA MAYURI C/O SHRI S. RAMA RAO, ADVOC ATE, FLAT NO.102 SHRIYAS ELEGANCE, DOOR NO.3-6-643 ST.NO.9 HIMAYATN AGAR, HYDERABAD 2 THE ITO WARD-1, NARSARAOPET 3 4. THE CIT GUNTUR THE CIT(A), GUNTUR 5 THE DR, ITAT, VISAKHAPATNAM. 6 GUARD FILE. BY ORDER SENIOR PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM