Late Shri. Hardas Dingomal Mirchandani, Pune V. Income tax Officer, Pune

ITA 524/PUN/2017

• Counselvise Citation: [2017] 126 COUNSELVISE.COM (IT) 6987 (ITAT-PUNE)
• Duration Of Justice: 9 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2017
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 18-09-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 03-03-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: RAJIV THAKKAR S HRI AJAY MODI
• Keywords: Capital asset; Cost of acquisition; Fair market value
• Section: 143(3); 54F; 54

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO. 524 /P U N/20 1 7 / ASSESSMENT YEAR : 20 11 - 12 LATE SHRI HARDAS DINGOMAL MIRCHANDANI, REPRESENTED BY SHEILA MIRCHANDANI, SHAH KHANDELWAL JAIN AND ASSOCIATES CHARTERED ACCOUNTANT LEVEL 3, BUSINESS BAY, PLOT NO.84, WELLESLEY ROAD, NEAR RTO, PUNE 411001 . / APPELLANT PAN:AJZPM2545C VS. THE INCOME TAX OFFICER, WARD 6(4), PUNE . / RESPONDENT / APPELLANT BY : SHRI RAJIV THAKKAR / RESPONDENT BY : S HRI AJAY MODI / DATE OF HEARING : 18 . 09 .2017 / DATE OF PRONOUNCEMENT: 11 . 1 2 .2017 / ORDER PER SUSHMA CHOWLA, JM: THE APPEAL FILED BY THE ASSESSEE IS AGAINST THE ORDER OF CIT(A) , PUNE - 10, DATED 13.01.2017 RELATING TO ASSESSMENT YEAR 20 11 - 12 AGAINST ORDER PASSED UNDER SECTION 143(3) OF THE INCOME TAX ACT 1961 (IN SHORT THE ACT). 2 . THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS OF APPEAL: - 2 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI 1. ON FACTS AND CIRCUMSTANCES PREVAILING IN THE CASE AND AS PER PROVISIONS & SCHEME OF THE ACT THE HONBLE CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF DEDUCTION AMOUNTING TO RS.68,35,750/ - U/S 54 OF THE INCOME - TAX ACT, 1961. JUST AND PROPER RELIEF BE GRANTED TO THE APPELLANT IN THIS RESPECT. 2. THE APPELLANT BE GRANTED CONSEQUENTIAL RELIEF IF ANY AS DEEMED TO BE FIT. 3. THE ISSUE RAISED IN THE PRESENT APPEAL IS AGAINST CLAIM OF DEDUCTION UNDER SECTION 54 OF THE ACT. 4. BRIEFLY, IN THE FACTS OF THE CASE, THE ASSESSEE HAD FURNISHED THE RETURN OF INCOME DECLARING TOTAL INCOME OF RS.1,47,44,376/ - . DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD SOLD PROPERTY FOR RS.9.29 CRORES, AGAINST WHICH IT HAD PAID BROKERAGE OF R S.9,29,000/ - . THE ASSESSEE WAS ASKED TO FURNISH THE DETAILS IN THIS REGARD, WHICH WERE FOUND TO BE SATISFACTORY BY THE ASSESSING OFFICER. AFTER CONSIDERING INDEXATION OF COST OF ACQUISITION, THE LONG TERM CAPITAL GAINS WORKED OUT TO RS.8,79,63,807/ - , THE ASSESSEE IN TURN, HAD PURCHASED ONE RESIDENTIAL LEASEHOLD FLAT FOR RS.5,77,86,965/ - (INCLUDING STAMP DUTY) AND INVESTED RS.1 CRORE IN NHAI BONDS. THE ASSESSEE SUBSEQUENTLY PURCHASED ANOTHER FLAT IN MARVEL, HADAPSAR FOR RS.68,35,750/ - AND CLAIMED SECOND D EDUCTION UNDER SECTION 54 OF THE ACT. THE CLAIM OF ASSESSEE OF DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF SECOND PROPERTY WAS DENIED AND AMOUNT WAS ADDED IN THE HANDS OF ASSESSEE. 5. THE CIT(A) AFTER CONSIDERING VARIOUS CASE LAWS RELIED UPON BY THE ASSESSEE FOR THE PROPOSITION THAT EXPRESSION OF A RESIDENTIAL HOUSE DOES NOT MEAN ONE RESIDENTIAL HOUSE OBSERVED THAT IN THE CASE OF ASSESSEE TWO FLATS WERE PURCHASED IN TWO DIFFERENT YEARS. THE ASSESSEES LEGAL HEIR WAS WIDOW AND WAS STAYING ALONE IN HER HOUSE IN PADMA VILAS BUILDING AND THE OTHER FLAT WAS IN 3 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI HADAPSAR AND IT WAS NOT EVEN KNOWN THAT THE SAME HAS BEEN USED BY THE ASSESSEE FOR HER RESIDENTIAL PURPOSE OR IS LET OUT ON RENT. THE BENEFIT OF LIBERAL INTERPRETATION OF THE WORD A RESIDENTI AL HOUSE COULD NOT BE EXTENDED TO THE ASSESSEE AND ACCORDINGLY, THE CLAIM OF ASSESSEE WAS REJECTED BY THE CIT(A). FURTHER, REFERENCE WAS MADE TO THE AMENDMENT MADE TO SECTION 54(1) OF THE ACT BY THE FINANCE ACT, 2014 W.E.F. 01.04.2015, WHEREIN A RESIDEN TIAL HOUSE HAS BEEN REPLACED BY ONE RESIDENTIAL HOUSE IN INDIA. THE CIT(A) OBSERVED THAT THE INTENTION OF AMENDMENT WAS TO OVERRULE THE FINDINGS OF CERTAIN COURTS WHO HAD INTERPRETED DEDUCTION UNDER SECTION 54 OF THE ACT BEING AVAILABLE WHERE INVESTMEN T MADE IN MORE THAN ONE RESIDENTIAL HOUSE. 6. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A). 7. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE ISSUE IS SQUARELY COVERED BY SERIES OF DECISIONS WITH SPECIAL REFERENCE TO THE RATIO LAID DOWN BY THE HONBLE HIGH COURT OF KARNATAKA IN CIT VS. SMT. K.G. RUKMINIAMMA (2011) 196 TA XMAN 87 (KAR) AND IN CIT VS. KHOOBCHAND M. MAKHIJA (2014) 43 TAXMANN.COM 143 (KAR). HE FURTHER REFERRED TO THE DECISION OF THE HONBLE HIGH COURT OF DELHI IN CIT VS. GITA DUGGAL (2013) 30 TAXMANN.COM 230 (DEL) AND ALSO THE MUMBAI BENCH OF TRIBUNAL IN DCIT VS. JAI TRIKANAND RAO (2014) 41 TAXMANN.COM 453 (MUMBAI - TRIB) . THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FURTHER POINTED OUT THAT AMENDMENT IN 2014 WAS PROSPECTIVE IN NATURE AND IT CLEARLY ESTABLISHED THAT THE TERM A RESIDENTIAL HOUSE IS TO BE INTERPRETED TO MEAN MORE THAN ONE RESIDENTIAL HOUSE. 4 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI 8. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE ON THE OTHER HAND, POINTED OUT THAT IN THE FACTS OF THE CASE BEFORE THE HONBLE HIGH COURT OF KARNATAKA, FLATS WERE PURCHASED AT THE SAME LOCATION VIDE SAME AGREEMENT. HE FURTHER RELIED ON THE FOLLOWING DECISIONS TO POINT OUT THAT WHERE THE FLATS ARE SITUATED AT TWO DIFFERENT LOCATIONS, THEN THE ASSESSEE IS NOT ENTITLED TO CLAIM DEDUCTION UNDER SECTION 54F OF THE ACT : - I) ITO VS. MS. SUSH ILA M. JHAVERI (2007) 107 ITD 327 (MUM)(SB) II) NEVILLE J. PEREIRA VS. ITO (2010) 8 TAXMANN.COM 68 (MUM) III) DCIT VS. RANJIT VITHALDAS LOKUPAVAN (2008) 25 SOT 420 (MUM) IV) ITO VS. SMT. ROHINI REDDY (2010) 122 ITD 1 (HYDERABAD) 9. HE FURTHER POINT ED OUT THAT THE HONBLE PUNJAB & HARYANA HIGH COURT IN PAWAN ARYA VS. CIT (2011) 11 TAXMANN.COM 312 (P&H) HAS REFERRED TO THE RATIO LAID DOWN BY THE HONBLE HIGH COURT OF KARNATAKA D. ANAND A BASAPPA VS. ITO (2009) 309 ITR 329 (KAR) AND POINTED OUT THAT DEDUCTION AGAINST PURCHASE OF TWO FLATS WAS ALLOWED SINCE BOTH THE FLATS WERE COMBINED TO MAKE ONE RESIDENTIAL UNIT. HOWEVER, THE CLAIM OF DEDUCTION UNDER SECTION 54F OF THE ACT IN RESPECT OF ACQUISITION OF TWO HOUSES WAS DENIED BY THE HONBLE HIGH COURT OF PUNJAB & HARYANA. IN RESPECT OF RELIANCE PLACED ON THE RATIO LAID DOWN BY THE HONBLE HIGH COURT OF KARNATAKA IN CIT VS. KHOOBCHAND M. MAKHIJA (SUPRA), IT WAS POINTED OUT THAT THE SAME WAS DECIDED ON ITS PECULIAR FACTS AND THE SAID RATIO CANNOT BE APPL IED TO DECIDE THE PRESENT ISSUE. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE LIMITED ISSUE WHICH ARISES IN THE PRESENT APPEAL IS INTERPRETATION OF PROVISIONS OF SECTION 54 OF THE ACT. THE ASSESSEE DURING THE YEAR UNDER CONSIDERAT ION HAD SOLD HER RESIDENTIAL BUNGALOW 243 IN SINDH CO - OP. HOUSING SOCIETY, PUNE FOR TOTAL 5 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI CONSIDERATION OF RS.9.29 CRORES. THE SAID PROPERTY WAS PURCHASED PRIOR TO 01.04.1981 AND THE FAIR MARKET VALUE AS ON 01.04.1981 WAS VALUED AT RS.4,25,000/ - . THE IN DEXED COST OF ACQUISITION WORKED OUT TO RS.30,21,750/ - . THE ASSESSEE HAD HELD THE SAID ASSET FOR MORE THAN THREE YEARS, SO PROFIT WAS DECLARED AS LONG TERM CAPITAL GAINS AND THE SAME WAS WORKED OUT AT RS.8,79,63,807/ - . THE ASSESSEE THEREAFTER, PURCHA SED ONE FLAT AT PADMA VILAS BUILDING, PUNE FOR RS.5,77,86,965/ - AND CLAIMED THE DEDUCTION UNDER SECTION 54 OF THE ACT. THE ASSESSEE ALSO INVESTED SUM OF RS. 1 CRORE IN NHAI BONDS, AGAINST WHICH IT ALSO CLAIMED DEDUCTION UNDER SECTION 54EC OF THE ACT. ANOT HER INVESTMENT WHICH WAS MADE BY THE ASSESSEE WAS IN FLAT AT HADAPSAR, PUNE FOR SUM OF RS.68,35,750/ - AND THE SAID INVESTMENT WAS ALSO CLAIMED AS DEDUCTION UNDER SECTION 54 OF THE ACT. THE FIRST FLAT WHICH WAS PURCHASED BY THE ASSESSEE WAS IN PADMA VILAS BUILDING, PUNE FOR RS.5.77 CRORES AND DEDUCTION UNDER SECTION 54 OF THE ACT WAS ALLOWED IN RESPECT THEREOF. THERE IS NO DISPUTE VIS - - VIS SAID INVESTMENT MADE BY THE ASSESSEE. HOWEVER, THE SECOND INVESTMENT WHICH WAS MADE BY THE ASSESSEE WAS IN FLAT WHICH WAS FAR AWAY FROM HIS EARLIER INVESTMENT AND W AS AN INDEPENDENT FLAT THOUGH RESIDENTIAL BUT IT WAS NOT CLEAR WHETHER THE SAME WAS BEING USED BY THE ASSESSEE FOR HER RESIDENTIAL PURPOSE OR WAS LET OUT. THE ASSESSING OFFICER AND THE CIT(A) HAVE DENIED DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF INVESTMENT MADE IN SECOND FLAT AS BEING NOT ELIGIBLE UNDER SECTION 54 OF THE ACT. THE ISSUE WHICH IS RAISED BEFORE US IS THE SAID DEDUCTION CLAIMED UNDER SECTION 54 OF THE ACT. 11. COMING TO THE PROVISIONS OF SECTION 54 OF THE ACT, WHEREIN IT IS CLEARLY PROVIDED THAT IN THE CASE OF ASSESSEE, WHETHER AN INDIVIDUAL OR HUF, WHERE CAPITAL GAINS ARISES FROM TRANSFER OF LONG TERM CAPITAL ASSET, BEING BUILDING OR LAND 6 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI APPURTENANT THERETO, BEING A RESIDENTIAL HOUSE, INCOME FROM WHICH IS CHARGEABLE TO TAX UNDER T HE HEAD INCOME FROM HOUSE PROPERTY AND IF THE ASSESSEE, WITHIN PERIOD OF ONE YEAR BEFORE, OR TWO YEARS AFTER THE DATE ON WHICH TRANSFER TOOK PLACE, PURCHASES OR HAS WITHIN PERIOD OF THREE YEARS AFTER THAT DATE, CONSTRUCTED A RESIDENTIAL HOUSE, THEN CAPIT AL GAINS WILL NOT BE CHARGED TO TAX. THE FIRST CONDITION IS THAT IT SHOULD BE A TRANSFER OF LONG TERM CAPITAL ASSET BEING BUILDING OR LAND APPURTENANT THERETO, WHICH WAS BEING USED AS RESIDENTIAL HOUSE . T HE ASSESSEE HAS FULFILLED THESE CONDITIONS AND THE RE IS NO DISPUTE ABOUT THE SAME. THE SECOND ASPECT OF PROVISIONS IS THE INVESTMENT WITHIN STIPULATED PERIOD IN A RESIDENTIAL HOUSE, ON WHICH INVESTMENTS CAPITAL GAINS WOULD NOT BE CHARGED TO TAX. THE FIRST INVESTMENT WHICH HAS BEEN MADE BY THE ASSESSEE IS IN THE FLAT IN PADMA VILAS BUILDING, PUNE FOR RS.5.77 CRORES WHICH HAS BEEN FOUND TO BE WITHIN THE SCOPE OF SAID SECTION AND THE DEDUCTION ON THIS COUNT HAS BEEN ALLOWED IN THE HANDS OF ASSESSEE. THE QUESTION WHICH ARISES FOR ADJUDICATION IS WHETHER F OR CLAIMING DEDUCTION UNDER SECTION 54 OF THE ACT CAN THE ASSESSEE CLAIM THE SAME IN RESPECT OF SECOND PROPERTY WHICH HAS BEEN PURCHASED INDEPENDENT OF FIRST PROPERTY. THE ASSESSEE IN THIS REGARD HAS RELIED ON SERIES OF DECISIONS INCLUDING THE DECISION OF THE HONBLE HIGH COURT OF KARNATAKA (SUPRA) AND THE HONBLE HIGH COURT OF DELHI (SUPRA). 12. THE FIRST DECISION ON THE ISSUE IS BY THE HONBLE HIGH COURT OF KARNATAKA IN D. ANANDA BASAPPA VS. ITO (2009) 180 TAXMAN 4 (KAR) AND THEREAFTER IN CIT VS. SMT. K.G. RUKMINIAMMA (SUPRA), WHEREIN IT WAS HELD AS UNDER: - THE CONTEXT IN WHICH THE EXPRESSION A RESIDENTIAL HOUSE IS USED IN SECTION 54 MAKES IT CLEAR THAT, IT WAS NOT THE INTENTION OF THE LEGISLATION TO CONVEY THE MEANING THAT: IT REFERS TO A SINGLE RE SIDENTIAL HOUSE, IF, THAT WAS THE INTENTION, THEY WOULD HAVE USED THE WORD ONE. AS IN THE EARLIER PART, THE WORDS USED ARE BUILDINGS OR LANDS WHICH ARE PLURAL IN NUMBER AND THAT: IS REFERRED TO AS A RESIDENTIAL HOUSE, THE ORIGINAL ASSET. AN ASSET NEW LY ACQUIRED AFTER THE SALE OF 7 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI THE ORIGINAL ASSET ALSO CAN BE BUILDINGS OR LANDS APPURTENANT THERETO, WHICH ALSO SHOULD BE A RESIDENTIAL HOUSE. THEREFORE THE LETTER A IN THE CONTEXT IT IS USED SHOULD NOT BE CONSTRUED AS MEANING SINGULAR. BUT, BEING AN INDEFINITE ARTICLE, THE SAID EXPRESSION SHOULD BE READ IN CONSONANCE WITH THE OTHER WORDS BUILDINGS AND LANDS AND, THEREFORE, THE SINGULAR A RESIDENTIAL HOUSE ALSO PERMITS USE OF PLURAL BY VIRTUE OF SECTION 13(2) OF THE GENERAL CLAUSES ACT. CIT V . D. ANANDA BASAPPA [2009] 223 (KAR) 186 : [2009] 2 - DTR (KAR) 266 FOLLOWED. 1 3 . IN THE FACTS OF THE CASE IN CIT VS. D. ANANDA BASAPPA (SUPRA), ASSESSEE HUF HAD SOLD ONE RESIDENTIAL HOUSE AND PURCHASED APARTMENTS SIDE BY SIDE WHICH WERE JOINED BY THE BUI LDER BY MAKING THEM AS ONE UNIT BY OPENING THE DOOR IN BETWEEN TWO APARTMENTS. ALSO, IN THE FACTS OF CIT VS. SMT. K.G. RUKMINIAMMA (SUPRA), THE ASSESSEE ENTERED INTO JOINT DEVELOPMENT AGREEMENT FOR PUTTING UP FLATS AND UNDER THE AGREEMENT, EIGHT RESIDENTI AL FLATS WERE PUT UP ON THAT PROPERTY, OUT OF WHICH FOUR FLATS REPRESENTING 48% WAS THE SHARE OF ASSESSEE AND REMAINING 52% WAS THE SHARE OF BUILDER. IN SUCH CIRCUMSTANCES, FOUR RESIDENTIAL FLATS ACQUIRED BY THE ASSESSEE WERE HELD NOT TO CONSTRUE FOUR RES IDENTIAL HOUSES BUT ONLY A RESIDENTIAL HOUSE. 14. IN A LATER DECISION, THE HONBLE HIGH COURT OF KARNATAKA IN CIT VS. KHOOBCHAND M. MAKHIJA (SUPRA) HAD APPLIED THE SAID PROPOSITION AS LAID DOWN IN CIT VS. SMT. K.G. RUKMINIAMMA (SUPRA) AND HELD THAT WHERE THE ASSESSEE HAD SOLD ONE RESIDENTIAL HOUSE AND INSTEAD OF PURCHASING ANOTHER BIG HOUSE, HE PURCHASED TWO SMALL RESIDENTIAL HOUSES TO ACCOMMODATE BOTH OF HIS SONS, THE HONBLE HIGH COURT VIDE PARA 17 HELD IT IS CLEAR THAT THE A SSESSEE HAD NOT ATTEMPTED TO EVADE TAX. FURTHER, VIDE PARA 18 HOLDING THE ASSESSEE TO BE ENTITLED TO THE BENEFIT CONFERRED UNDER SECTION 54(1) OF THE ACT, WHERE THE ASSESSEE HAD ACQUIRED TWO RESIDENTIAL HOUSES, THE HONBLE HIGH COURT HELD THAT THE SAME FA LLS WITHIN THE PHRASE A RESIDENTIAL HOUSE. IT WAS FURTHER HELD BY THE HONBLE HIGH COURT THAT HOWEVER , WE MAKE IT CLEAR THAT WHILE INTERPRETING THIS WORD, THE COURT 8 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI OR THE TRIBUNAL OR THE AUTHORITIES HAVE TO KEEP IN MIND THE FACTS OF THE PARTICULAR CASE . WHEN WE HAVE HELD A CANNOT BE READ AS SINGULAR, IT ALSO CANNOT BE READ AS MULTIPLES AND SO AS TO AVOID PAYING TAX UNDER SECTION 45 OF THE ACT. 15. IN THE FACTS OF THE CASE BEFORE THE HONBLE HIGH COURT OF DELHI IN CIT VS. GITA DUGGAL (SUPRA) ALSO, THE ASSESSEE HAD MADE INVESTMENT IN ANOTHER RESIDENTIAL HOUSE WITH FLATS ON DIFFERENT FLOORS AND THE HONBLE HIGH COURT HELD THE SAME TO BE ELIGIBLE FOR DEDUCTION UNDER SECTION 54 OF THE ACT. 16. IN THE FACTS OF THE CASE BEFORE THE HONBLE HIGH COURT OF ANDHRA PRADESH IN CIT VS. SYED ALI ADIL (2013) 33 TAXMANN.COM 212 (AP) ALSO, INVESTMENT WAS MADE IN TWO RESIDENTIAL UNITS, WHICH THOUGH WERE PURCHASED FROM TWO VENDORS BUT HAD ADJACENT KITCHENS AND TOILETS AND HAD COMMON MEETING POINT AND HENCE, DEDUCTION WAS HELD TO BE ALLOWABLE TO THE ASSESSEE. 17. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE HAS STRONGLY RELIED ON THE RATIO LAID DOWN BY THE HONBLE HIGH COURT OF PUNJAB AND HARYANA IN PAWAN ARYA VS. CIT (SUPRA) , WHICH IN A LATER DECISION HA S DISTINGUISHED THE RATIO LAID DOWN BY THE HONBLE HIGH COURT OF KARNATAKA IN D. ANANDA BASAPPA VS. ITO (SUPRA) AND HAS HELD THAT IN THE IMPUGNED ORDER, DEDUCTION WAS ALLOWED AGAINST PURCHASE OF TWO FLATS HAVING REGARD TO THE FINDING THAT BOTH COULD BE TRE ATED AS ONE HOUSE AS BOTH HAD BEEN COMBINED TO MAKE ONE RESIDENTIAL UNIT. HOWEVER, THE SAID JUDGMENT PROCEEDED ON DIFFERENT FACTS AND SITUATIONS. IN THE FACTS BEFORE THE HONBLE HIGH COURT OF PUNJAB & HARYANA IN PAWAN ARYA VS. CIT (SUPRA), THE ASSESSEE H AD SET UP THE LONG TERM CAPITAL GAINS AGAINST ACQUISITION OF TWO INDEPENDENT HOUSES, WHICH WAS DENIED TO THE ASSESSEE. 9 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI 18. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE HAS RELIED ON DECISIONS OF DIFFERENT BENCHES OF TRIBUNAL AND ALSO THE SPECI AL BENCH OF TRIBUNAL, WHEREIN THE WORD A RESIDENTIAL HOUSE HAS BEEN DEFINED TO MEAN ONLY ONE RESIDENTIAL HOUSE. 19. HOWEVER, IN ORDER TO ADJUDICATE THE ISSUE, WE REFER TO THE PROPOSITION LAID DOWN BY THE HONBLE HIGH COURT OF KARNATAKA IN VARIOUS DECISIONS AND THE HONBLE HIGH COURT OF DELHI WHEREIN THE FACTS WERE AT VARIANCE TO THE FACTS BEFORE US. THE ASSESSEE IN THE PRESENT CASE BEFORE US HAS PURCHASED ONE FLAT IN PADMA VILAS BUILDING AND ANOTHER AT HADAPSAR, PUNE WHICH ARE AT TWO DIFFERENT PLA CES AND ARE NOT COMMONLY PLACED. SECONDLY, THERE IS FINDING OF FACT THAT WIDOW OF ASSESSEE IS STAYING ALONE IN THE HOUSE AT PADMA VILAS BUILDING AND IT IS NOT CLEAR WHETHER THE OTHER HOUSE IS OCCUPIED BY HER OR ON RENT. UNDER THE PROVISIONS OF THE ACT, I T IS NOT THE REQUIREMENT TO OCCUPY THE PREMISES FOR ITSELF . HOWEVER, WE HAVE TO KEEP IN MIND THE OBSERVATIONS OF THE HONBLE HIGH COURT OF KARNATAKA IN CIT VS. KHOOBCHAND M. MAKHIJA (SUPRA), WHEREIN AFTER ALLOWING THE CLAIM OF DEDUCTION UNDER SECTION 54 O F THE ACT IN RESPECT OF SECOND CONSECUTIVE FLAT, THE HONBLE HIGH COURT HELD THAT WHILE INTERPRETING THE WORD A RESIDENTIAL HOUSE, THE COURT OR THE TRIBUNAL OR THE AUTHORITIES HAVE TO KEEP IN MIND THE FACTS OF PARTICULAR CASE. THE HONBLE HIGH COURT HAS CLEARLY HELD THAT A CANNOT BE READ AS SINGULAR, IT ALSO CANNOT BE READ AS MULTIPLES AND SO AS TO AVOID PAYING TAX UNDER SECTION 45 OF THE ACT. APPLYING THE SAID PRINCIPLE TO THE FACTS OF THE PRESENT CASE, WE HOLD THAT THE ASSESSEE IS ENTITLED TO CLAIM THE DEDUCTION UNDER SECTION 54 OF THE ACT ONLY IN RESPECT OF FLAT IN PADMA VILAS BUILDING. WE UPHOLD THE ORDER OF CIT(A) IN DENYING THE DEDUCTION UNDER SECTION 54 OF THE ACT IN RESPECT OF FLAT AT HADAPSAR. THE AMENDMENT TO SECTION 54(1) OF THE ACT VIDE 10 ITA NO. 524 /PUN/20 17 LATE SHRI HARDAS D MIRCHANDANI F INANCE ACT, 2014 ALSO EXPLAINS THE SITUATION OF ONE RESIDENTIAL HOUSE IN INDIA. ACCORDINGLY, WE DISMISS THE GROUNDS OF APPEAL RAISED BY THE ASSESSEE. 20 . IN THE RESULT, APPEAL OF ASSESSEE IS DISMISSED. ORDER PRONOUNCED ON THIS 11 TH DAY OF DECEM BER , 201 7 . SD/ - SD/ - (ANIL CHATURVEDI) (SUSHMA CHOWLA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 11 TH DECEM BER , 201 7 . G G C C V V S S R R / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) , PUNE - 10 ; 4. THE P C IT - 2 , PUNE ; 5. , , / DR B , ITAT, PUNE; 6. / GUARD FILE. / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE