AFTAB A L FURNITUREWALA, MUMBAI V. ITO-19(3)(1), MUMBAI

ITA 5178/MUM/2016

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6964 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 9 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-05-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: Not Allotted
• Assessment Year: 2011-2012
• Appeal Filed On: 16-08-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: DR K SHIVARAM
• Keywords: Opportunity of being heard; Additional evidence; Cost of acquisition
• Section: 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL 'I' BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER AND SHRIN.K. PRADHAN, ACCOUNTANT MEMBER ITA NO.5178/MUM/2016 (ASSESSMENT YEAR:2011-12) SHRI AFTAB A L FURNITUREWALA 601, CHARISMAN APARTMENTS 48, GURUNANAK ROAD 23RD ROAD, BANDRA (W) MUMBAI 400050 VS. INCOME TAX OFFICER - 19(3)(1) PIRAMAL CHAMBERS LOWER PAREL, MUMBAI PAN AABPF9617P APPELLANT RESPONDENT APPELLANT BY: DR. K. SHIVARAM & SHRI SASHANK DUNDU RESPONDENT BY: SHRI ANOOP HIWASE DATE OF HEARING: 10.05.2018 DATE OF PRONOUNCEMENT: 23.05.2018 O R D E R PER SAKTIJIT DEY, JM THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-32, MUMBAI, DA TED 17.06.2016, FOR ASSESSMENT YEAR 2011-12. 2. THE DISPUTE IN THIS APPEAL IS CONFINED TO PART DISA LLOWANCE OF DEDUCTION CLAIMED UNDER SECTION 54 OF THE INCOME TA X ACT (HEREINAFTER THE ACT). 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE, AN INDIVIDUAL, FILED HIS RETURN OF INCOME FOR THE ASSESSMENT YEAR UNDER DISPUTE ON 04.03.2012 DECLARING TOTAL INCOME OF ` 16,60,958/-. IN THE COURSE ASSESSMENT PROCEEDINGS THE AO, WHILE VERIFYING THE RETURN OF I NCOME AND COMPUTATION OF INCOME FILED BY THE ASSESSEE, FOUND THAT IN THE RELEVANT PREVIOUS YEAR ASSESSEE HAS SOLD A DUPLEX FLAT LOCATED AT CHARISHM A CO-OPERATIVE HOUSING SOCIETY, GURU NANAK ROAD, BANDRA (W) ALONG WITH OPE N CAR PARKING SPACES ITA NO. 5178/MUM/2016 SHRI AFTAB A L FURNITUREWALA 2 ON 29.12.2010 FOR A TOTAL CONSIDERATION OF ` 8.21 CRORES. AFTER REDUCING THE INDEXED COST OF ACQUISITION OF ` 68,78,480/- THE LONG TERM CAPITAL GAIN FROM THE SALE OF FLAT WAS SHOWN AT ` 7,52,21,520/-. HOWEVER, THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 54 OF THE ACT ON TH E TOTAL AMOUNT OF LONG TERM CAPITAL GAIN AMOUNTING TO ` 7,52,21,520/- TOWARDS PURCHASE OF A NEW RESIDENTIAL FLAT AT KHAR. FOR VERIFYING ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 54 OF THE ACT, THE AO CALLED FOR THE NECESS ARY DETAILS AND AFTER PERUSING THE DETAILS FILED BY THE ASSESSEE FOUND TH AT THE ASSESSEE HAS CLAIMED DEDUCTION UNDER SECTION 54 OF THE ACT AMOUN TING TO ` 7,52,21,520/- TOWARDS PURCHASE OF THREE SEPARATE FL ATS AND TWO GARAGES IN A BUILDING SITUATED AT RITWALCO.OP. HOUSING SOCI ETY, KHAR (W), MUMBAI BY ENTERING INTO SEPARATE AGREEMENTS WITH DIFFERENT PARTIES. ON GOING THROUGH THE SALE DEEDS THE AO FOUND THAT THE COST O F INVESTMENT IN PURCHASE OF THREE FLATS AMOUNTED TO ` 5,57,52,000/- AND THE COST INCURRED FOR PURCHASE OF TWO GARAGES AMOUNTED TO ` 1,06,50,000/-, TOTAL AGGREGATING TO ` 6,64,02,000/-. THUS, THERE IS A DIFFERENCE OF ` 88,19,520/- BETWEEN THE LONG TERM CAPITAL GAIN SHOWN BY THE ASSESSEE AND IN VESTMENTS MADE IN PURCHASE OF NEW FLATS. THEREFORE, THE AO CALLED UPO N THE ASSESSEE TO JUSTIFY HIS CLAIM OF DEDUCTION UNDER SECTION 54 OF THE ACT. FURTHER, HE ALSO CALLED UPON THE ASSESSEE TO EXPLAIN AS TO HOW DEDUCTION UN DER SECTION 54 OF THE ACT CAN BE ALLOWED ON PURCHASE OF GARAGES. IN RESPO NSE TO THE QUERY RAISED BY THE AO THE ASSESSEE SUBMITTED THAT THE DIFFERENC E BETWEEN THE INVESTMENT MADE AND THE LONG TERM CAPITAL GAIN SHOW N WAS ON ACCOUNT OF COST INCURRED TOWARDS REPAIR/REMODELLING OF THE NEW RESIDENTIAL FLAT, WHICH SHOULD BE ALLOWED AS DEDUCTION. HE FURTHER SUBMITTE D THAT GARAGES BEING PART OF RESIDENTIAL FLAT, ARE ALSO ELIGIBLE FOR DED UCTION UNDER SECTION 54 OF THE ACT. THE AO, HOWEVER, WAS NOT CONVINCED BY THE EXPLANATION OF THE ASSESSEE. HE HELD THAT THE ASSESSEES CLAIM OF DEDU CTION UNDER SECTION 54 OF THE ACT IN RESPECT OF GARAGES CANNOT BE ALLOWED BECAUSE IT IS A TRANSACTION DISTINGUISH FROM PURCHASE/CONSTRUCTION OF RESIDENTIAL HOUSE. HE ALSO DISALLOWED ASSESSEES CLAIM FOR DEDUCTION O F COST INCURRED TOWARDS REPAIR/REMODELLING OF THE HOUSE. THUS, HE RESTRICTE D THE DEDUCTION UNDER SECTION 54 OF THE ACT TO AN AMOUNT OF ` 5,57,52,000/-. ITA NO. 5178/MUM/2016 SHRI AFTAB A L FURNITUREWALA 3 4. BEING AGGRIEVED BY THE AFORESAID DECISION OF THE AO ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A). IN THE COURSE O F PROCEEDINGS BEFORE HIM THE LEARNED CIT(A), AFTER VERIFYING THE MATERIAL ON RECORD WAS OF THE VIEW THAT AS PER PROVISIONS OF SECTION 54 OF THE ACT ASS ESSEE IS ELIGIBLE TO CLAIM DEDUCTION IN RESPECT OF ONE RESIDENTIAL FLAT. THE C IT(A) OBSERVED THAT THREE FLATS PURCHASED BY THE ASSESSEE, THOUGH ARE IN THE SAME BUILDING, BUT ARE SITUATED IN DIFFERENT FLOORS OF THE BUILDING AND AR E PURCHASED FROM DIFFERENT PERSONS VIDE SEPARATE AGREEMENTS. THUS, HE CALLED U PON THE ASSESSEE TO EXPLAIN AS TO WHY THE DEDUCTION CLAIMED UNDER SECTI ON 54 OF THE ACT SHOULD NOT BE RESTRICTED TO INVESTMENT MADE IN ONE RESIDENTIAL FLAT. IN THIS REGARD THE CIT(A) ALSO ISSUED A NOTICE OF ENHANCEME NT UNDER SECTION 251(2) OF THE ACT. THOUGH, THE ASSESSEE OBJECTED TO THE DISALLOWANCE PROPOSED BY THE CIT(A), HOWEVER, REJECTING THE OBJE CTIONS OF THE ASSESSEE HE RESTRICTED THE DEDUCTION CLAIMED UNDER SECTION 54 O F THE ACT TO THE COST INCURRED BY ASSESSEE TOWARDS PURCHASE OF A SINGLE F LAT. WHILE DOING SO THE LEARNED CIT(A) OBSERVED THAT THE THREE FLATS PURCHA SED BY THE ASSESSEE ARE LOCATED IN DIFFERENT FLOORS OF THE SAME BUILDING AN D HAVE SEPARATE ENTRANCE AND SEPARATE KITCHENS. THEREFORE, THEY CANNOT BE CO NSIDERED AS A SINGLE RESIDENTIAL UNIT. FURTHER, HE OBSERVED THAT THE ASS ESSEE DID NOT FURNISH APPROVED PLAN OF THE MUNICIPAL AUTHORITIES TO DEMON STRATE THAT THE THREE FLATS ARE SINGLE RESIDENTIAL UNIT HAVING COMMON ENT RANCE AND COMMON KITCHEN. IN THIS CONTEXT HE RELIED UPON CERTAIN DEC ISIONS OF THE ITAT. OF COURSE, HE ALSO UPHELD THE VIEW OF THE AO IN DISALL OWING ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF GARAGES AND THE EXPENDITURE INCURRED IN REPAIR AND REMODELLING OF T HE FLATS. 5. DR. K. SHIVARAM, LEARNED SR. COUNSEL FOR THE ASSESS EE SUBMITTED, BEFORE THE AO ASSESSEE HAS FURNISHED A PLAN OF THE ARCHITECT AND OTHER RELEVANT EVIDENCES TO DEMONSTRATE THAT THOUGH THE A SSESSEE HAS PURCHASED THREE FLATS FROM THREE PERSONS, HOWEVER, HE HAS CON VERTED ALL THE THREE FLATS TO A SINGLE RESIDENTIAL UNIT WITH A COMMON ENTRANCE AND COMMON KITCHEN. HE SUBMITTED, TO VERIFY THE CLAIM OF THE ASSESSEE T HE AO MADE A PHYSICAL ENQUIRY THROUGH THE INSPECTOR OF INCOME TAX, WHO HA D SUBMITTED A REPORT ITA NO. 5178/MUM/2016 SHRI AFTAB A L FURNITUREWALA 4 STATING THAT THE THREE FLATS HAVE BEEN CONVERTED TO A SINGLE RESIDENTIAL UNIT HAVING COMMON ENTRANCE AND COMMON KITCHEN AND A COM MON INTERNAL STAIRCASE. HE FURTHER SUBMITTED, ON THE BASIS OF SU CH REPORT OF THE INSPECTOR THE AO ALLOWED DEDUCTION CLAIMED UNDER SE CTION 54 OF THE ACT IN RESPECT OF ALL THE THREE FLATS CONVERTED INTO A SIN GLE RESIDENTIAL UNIT. HE SUBMITTED, LEARNED CIT(A) WITHOUT PROPERLY APPRECIA TING THE EVIDENCES BROUGHT ON RECORD AND BY MISAPPLYING THE PROVISIONS OF LAW AS WELL AS THE RATIO LAID DOWN IN JUDICIAL PRECEDENTS HAS EXERCISE D HIS POWER UNDER SECTION 251(2) OF THE ACT IN ENHANCING THE INCOME, WHICH IS INVALID. HE SUBMITTED THAT THE THREE FLATS HAVE BEEN CONVERTED TO A SINGLE RESIDENTIAL UNIT AND ASSESSEE IS ENTITLED FOR DEDUCTION UNDER S ECTION 54 OF THE ACT. TO DEMONSTRATE THE FACT THAT THE THREE FLATS ARE CONVE RTED INTO A SINGLE RESIDENTIAL UNIT THE LEARNED COUNSEL FOR THE ASSESS EE DREW OUR ATTENTION TO THE FLOOR PLAN OF THE RESIDENTIAL PROPERTY AS PREPA RED BY THE ARCHITECTURE. HE ALSO FILED AN APPLICATION SEEKING TO SUBMIT A LE TTER DATED 29 TH JANUARY, 2018 ISSUED BY RITWAL HOUSING SOCIETY BY WAY OF ADD ITIONAL EVIDENCE, WHEREIN, THE HOUSING SOCIETY HAS STATED THAT IT HAS GRANTED PERMISSION TO THE ASSESSEE TO CONVERT THREE FLATS TO ONE RESIDENT IAL UNIT HAVING A SINGLE KITCHEN AND PRIVATE STAIRCASE. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED, THE EXPRESSION A RESIDENTIAL HOUSE USE D IN SECTION 54 OF THE ACT, AS IT EXISTED DURING THE RELEVANT PERIOD DOES NOT MEAN ONE RESIDENTIAL HOUSE. IN SUPPORT OF SUCH PROPOSITION HE RELIED UPO N THE FOLLOWING DECISIONS: - I) CIT VS. GITA DUGGAL (2013) 357 ITR 153 (DEL.) II) CIT VS. DEVEDASNAIK (2014) 366 ITR 12(BOM.) III) CIT VS. D. ANANDA BASAPPA (2009) 309 ITR 329 (KAR.) IV) CIT VS. K.G. RUKMINIAMMA (2011) 331 ITR 211 (KAR.) AS REGARDS THE ISSUE RELATING TO CLAIM OF DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF GARAGES, THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT AS PER THE CONDITION IMPOSED BY THE HOUSE SOCI ETY THE ASSESSEE COULD HAVE PURCHASED THE RESIDENTIAL FLATS ONLY IF IT HAD PARKING SPACE. THEREFORE, THE ASSESSEE WAS COMPELLED TO PURCHASE THE GARAGES, OTHERWISE, THE ITA NO. 5178/MUM/2016 SHRI AFTAB A L FURNITUREWALA 5 ASSESSEE WOULD NOT HAVE BEEN ALLOWED TO PURCHASE TH E RESIDENTIAL FLATS. HE SUBMITTED, IN THE GIVEN FACTS AND CIRCUMSTANCES THE GARAGES SHOULD BE CONSIDERED AS PART OF THE RESIDENTIAL UNIT, HENCE, ELIGIBLE FOR DEDUCTION UNDER SECTION 54 OF THE ACT. IN SUPPORT OF SUCH CON TENTION LEARNED COUNSEL FOR THE ASSESSEE RELIED UPON THE FOLLOWING DECISION S: - I) M/S. PENELOPE ANN DOS REMEDIOS VS. ITO ITA NO. 7928/MUM/2010 DATED 06.09.2013 II) ACIT VS. SMT. USHA B. MADAN ITA NO. 4258/MUM/2011 D ATED 13.06.2012 FINALLY, LEARNED COUNSEL SUBMITTED, THE ASSESSEE HA VING INCURRED EXPENDITURE OF ` 88,19,520/- IN REMODELLING THE NEW RESIDENTIAL FLAT , IT IS PART OF THE COST INCURRED FOR THE FLAT, HENCE, IS T O BE ALLOWED AS DEDUCTION UNDER SECTION 54 OF THE ACT. 6. THE LEARNED DEPARTMENTAL REPRESENTATIVE STRONGLY RE LYING UPON THE OBSERVATIONS OF THE LEARNED CIT(A) SUBMITTED THAT N EITHER BEFORE THE AO NOR BEFORE THE FIRST APPELLATE AUTHORITY ASSESSEE W AS ABLE TO DEMONSTRATE THAT THE THREE RESIDENTIAL FLATS PURCHASED BY HIM W ERE IN FACT A SINGLE RESIDENTIAL UNIT HAVING COMMON ENTRANCE, COMMON KIT CHEN, ETC. HE SUBMITTED THAT THE LEARNED CIT(A), AFTER VERIFYING THE FACTS AND MATERIAL ON RECORD HAS GIVEN A CATEGORICAL FINDING THAT NOT ONL Y THE FLATS WERE PURCHASED SEPARATELY UNDER THREE DIFFERENT AGREEMEN TS BUT THEY ARE LOCATED IN DIFFERENT FLOORS OF THE SAME BUILDING. H E SUBMITTED, THOUGH THE CIT(A) CALLED FOR FLOOR PLAN TO DEMONSTRATE THAT TH E THREE FLATS ARE SINGLE RESIDENTIAL UNIT, ASSESSEE FAILED TO PROVE THE FACT . THEREFORE, HE SUBMITTED, ASSESSEES CLAIM THAT THE THREE FLATS ARE A SINGLE RESIDENTIAL UNIT CANNOT BE ACCEPTED. HESUBMITTED, GARAGES PURCHASED BY THE ASS ESSEE NOT BEING PART OF THE RESIDENTIAL UNIT, CANNOT BE CONSIDERED FOR T HE PURPOSE OF ALLOWING DEDUCTION UNDER SECTION 54 OF THE ACT. AS REGARDS T HE COST INCURRED FOR REMODELLING, HE SUBMITTED THAT THE ASSESSEE HAS NOT ARGUED THE DISALLOWANCE BEFORE THE CIT(A). THEREFORE, ASSESSEE S CLAIM CANNOT BE ALLOWED AT THIS STAGE. ITA NO. 5178/MUM/2016 SHRI AFTAB A L FURNITUREWALA 6 7. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED TH E MATERIAL ON RECORD. WE HAVE ALSO APPLIED OUR MIND TO THE DECISI ONS RELIED UPON. THE DISPUTE BETWEEN THE ASSESSEE AND THE DEPARTMENT IS RESTRICTED TO THE CLAIM OF DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF INVESTMENT OF CAPITAL GAIN IN A NEW RESIDENTIAL HOUSE. FURTHER, THE DISPU TE BETWEEN THE PARTIES CAN BE NARROWED DOWN TO THREE ISSUES, I.E. (I) WHET HER THE INVESTMENT MADE BY THE ASSESSEE IN THREE RESIDENTIAL FLATS ARE ELIG IBLE FOR DEDUCTION UNDER SECTION 54 OF THE ACT, (II) WHETHER ASSESSEE CAN CL AIM DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF GARAGES, AND (I II) WHETHER THE CLAIM OF EXPENDITURE INCURRED FOR REMODELLING OF THE NEW RES IDENTIAL FLAT CAN BE ALLOWED UNDER SECTION 54 OF THE ACT. 8. AS FAR AS THE FIRST ISSUE, I.E. CLAIM OF DEDUCTION IN RESPECT OF RESIDENTIAL FLAT, AT THE OUTSET WE MUST OBSERVE THA T WE DO NOT FIND ANY MERIT IN THE SUBMISSION OF THE LEARNED COUNSEL FOR THE ASSESSEE WITH REGARD TO THE EXERCISE OF POWERS UNDER SECTION 251(2) OF T HE ACT. ON PERUSAL OF FACTS ON RECORD WE ARE OF THE VIEW THAT THE LEARNED CIT(A) HAS EXERCISED HIS POWERS UNDER SECTION 251(2) OF THE ACT BY FOLLOWING THE STATUTORY MANDATE. THEREFORE, THE GROUND RAISED BY THE ASSESSEE IN THI S REGARD IS DISMISSED. 9. AS REGARDS ASSESSEES CLAIM OF DEDUCTION UNDER SECT ION 54 OF THE ACT IN RESPECT OF THREE FLATS CLAIMED TO HAVE BEEN CONV ERTED INTO A SINGLE RESIDENTIAL UNIT, GOING THROUGH THE FACTS ON RECORD WE FIND THAT THE OBSERVATION OF THE AO AND LEARNED CIT(A) ARE CONTRA DICTORY ON FACTS. WHILE THE AO HAS ACCEPTED ASSESSEES CLAIM THAT THE THREE RESIDENTIAL FLATS ARE A SINGLE RESIDENTIAL UNIT, THE CIT(A) HAS HELD THAT S INCE THE THREE RESIDENTIAL FLATS ARE LOCATED ON DIFFERENT FLOORS OF THE SAME B UILDING AND NOTHING HAS BEEN BROUGHT ON RECORD TO SHOW THAT THEY HAVE BEEN CONVERTED INTO A SINGLE RESIDENTIAL UNIT, ASSESSEES CLAIM OF DEDUCTION UND ER SECTION 54 OF THE ACT IN RESPECT OF ALL THE THREE FLATS CANNOT BE ALLOWED. I N THIS CONTEXT, THOUGH, LEARNED COUNSEL FOR THE ASSESSEE HAS SUBMITTED BEFO RE US THAT DURING ASSESSMENT PROCEEDINGS THE AO HAS CONDUCTED PHYSICA L ENQUIRY THROUGH INSPECTOR AND HAS FOUND THAT THE THREE RESIDENTIAL FLATS HAVE BEEN CONVERTED TO ONE RESIDENTIAL UNIT HAVING COMMON ENTRANCE, COM MON KITCHEN AND ITA NO. 5178/MUM/2016 SHRI AFTAB A L FURNITUREWALA 7 INTERNAL STAIRCASE,HOWEVER, NO SUCH OBSERVATION OF THE AO IS FORTHCOMING IN THE ASSESSMENT ORDER. EVEN, THE ENQUIRY REPORT OF T HE INSPECTOR, IF AT ALL THERE IS ONE, HAS NOT BEEN SUBMITTED BEFORE US. OF COURSE, LEARNED COUNSEL FOR THE ASSESSEE HAS SUBMITTED BEFORE US THE PLAN O F THE ARCHITECT, WHICH WAS CLAIMED TO HAVE BEEN PRODUCED BEFORE THE CIT(A) . BESIDES THAT, A LETTER DATED 29 TH JANUARY, 2018 ISSUED BY THE HOUSING SOCIETY IS SOU GHT TO BE PRODUCED BY WAY OF ADDITIONAL EVIDENCE. IN THE SAID LETTER IT HAS BEEN STATED THAT PERMISSION HAS BEEN GRANTED TO THE ASSESSEE TO CONVERT ALL THE THREE FLATS INTO ONE RESIDENTIAL UNIT HAVING A SINGLE KIT CHEN AND PRIVATE STAIRCASE. IN OUR CONSIDERED OPINION, THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE, SINCE, IS CRUCIAL FOR DECIDING THE ISSUE IN DISPUTE , NEEDS TO BE ADMITTED. HOWEVER, SINCE, THE DEPARTMENTAL AUTHORITIES DID NO T HAVE THE OPPORTUNITY TO EXAMINE THE AFORESAID EVIDENCE, THE SAME REQUIRE S TO BE LOOKED INTO BY THEM. MOREOVER, ASSESSEES CLAIM THAT THE THREE RES IDENTIAL UNITS HAVES BEEN CONVERTED INTO A SINGLE UNIT HAVING COMMON KITCHEN, COMMON ENTRANCE, ETC. NOT ONLY HAS TO BE PROVED THROUGH DOCUMENTARY EVIDE NCE BUT AN ENQUIRY IS ALSO REQUIRED TO BE MADE TO FIND OUT THE VERACITY O F ASSESSEES CLAIM. IN CASE ASSESSEES CLAIM IS FOUND TO BE CORRECT, THEN APPLY ING THE RATIO LAID DOWN IN THE JUDICIAL PRECEDENTS CITED BEFORE US ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF THE THREE FLATS CONVERTED INTO A SINGLE RESIDENTIAL UNIT IS ALLOWABLE. HOWEVER, FOR FACTUAL LY VERIFYING THE CLAIM OF THE ASSESSEE THAT THE THREE FLATS HAVE BEEN CONVERTED I NTO A SINGLE RESIDENTIAL UNIT, WE RESTORE THE ISSUE TO THE FILE OF THE AO FO R DECIDING AFRESH AFTER PROPER ENQUIRY. 10. AS REGARDS THE ISSUE OF CLAIM OF DEDUCTION UNDER SE CTION 54 OF THE ACT IN RESPECT OF GARAGES, IN OUR VIEW THE ISSUE HA S TO BE DECIDED KEEPING IN VIEW THE JUDICIAL PRECEDENTS CITED BEFORE US, WH ICH HAVE NOT BEEN CONSIDERED BY THE DEPARTMENTAL AUTHORITIES. THEREFO RE, THIS ISSUE ALSO REQUIRES TO BE RESTORED TO THE FILE OF THE AO FOR F RESH ADJUDICATION. 11. SIMILARLY, THE ISSUE RELATING TO ASSESSEES CLAIM O F DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF THE COST INCURR ED FOR REMODELLING OF THE NEW RESIDENTIAL HOUSE REQUIRES RE-EXAMINATION. ITA NO. 5178/MUM/2016 SHRI AFTAB A L FURNITUREWALA 8 12. IN VIEW OF THE ABOVE WE RESTORE THE ISSUE RELATING TO ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 54 OF THE ACT TO THE AO FOR DE NOVO ADJUDICATION KEEPING IN VIEW OUR OBSERVATIONS HEREINABOVE AND ON LYAFTER DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. 13. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD MAY, 2018. SD/ - SD/ - (N.K. PRADHAN) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 23 RD MAY, 2018 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) -32, MUMBAI 4. THE PR. CIT- 20, MUMBAI 5. THE DR, I BENCH, ITAT, MUMBAI BY ORDER //TRUE COPY// ASSISTANT REGISTRAR ITAT, MUMBAI BENCHES, MUMBAI N.P.