Dhriti Grover, CHENNAI V. ITO, CHENNAI

ITA 529/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4521 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 2 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-05-2017
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 07-03-2016
• Court: TRIBUNAL
• Department Lawyers: SHIVA SRINIVAS
• Assessee Lawyers: T BANUSEKAR
• Keywords: Revised return
• Section: 54F; 54; 139

Judgement Text

, , IN THE INCOME - TAX APPELLATE TRIBUNAL A BENCH, CHENNAI , . , BEFORE SHRI CHANDRA POOJARI , ACCOUNTANT MEMBER & SHRI DUVVURU RL REDDY , J UDICIAL MEMBER ./ I.T.A.NO. 529 /MDS/2016 / ASSESSMENT YEAR :20 1 2 - 1 3 SMT. DHRITI GROVER, NO. 81 & 83, LAURELS APARTMENT, C.P. RAMASAMY ROAD, ABHIRAMAPURAM, CHENNAI 600 0 18 . [PAN: A FYPG3832P ] VS. THE INCOME TAX OFFICER , NON CORPOR ATE WARD 3( 2 ) , CHENNAI 600 034 . ( / APPELLANT ) ( / RESPONDENT ) / APPELLANT BY : SHRI T. BANUSEKAR, C.A. / RESPONDENT BY : SHRI S HIVA SRINIVAS , J CIT / DATE OF HEARING : 0 1 . 0 3 .201 7 / DATE OF P RONOUNCEMENT : 26 . 0 5 .201 7 / O R D E R PER DUVVURU RL REDDY , JUDICIAL MEMBER : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) 4 , CHENNAI DA TED 31 . 12 .201 5 RELEVANT TO THE ASSESSMENT YEAR 20 1 2 - 1 3 , WHEREIN , THE ONLY EFFECTIVE GROUND RAISED IN THE APPEAL OF THE ASSESSEE IS THAT THE LD. CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF EXEMPTION CLAIMED UNDER SECTION 54F OF THE INCOME TAX ACT, 19 61 [ ACT IN SHORT) . I.T.A. NO. 529 /M/16 2 2. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HAS FILED HER RETURN OF INCOME ON 30 .0 9 .20 1 2 ADMITTING INCOME AT NIL . SUBSEQUENTLY, A REVISED RETURN OF INCOME DECLARING NIL INCOME WAS FILED ON 01.04.2013 UNDER SECTION 139(4) OF THE ACT AND THE REVISED RETURN OF INCOME OF THE ASSESSEE WAS SELECTED FOR SCRUTINY TO VERIFY THE EXEMPTION UNDER SECTION 54 OF THE ACT CLAIMED BY THE ASSESSEE. 3. THE ASSESSEE HAS SOLD A RESIDENTIAL PROPERTY SITUATED AT NO. 8, CHANDRIKA APARTMENTS, COLLEGE LANE, CHENNAI - 34, FOR A SALE CONSIDERATION OF .3,30,00,000/ - TO TWO PERSONS THROUGH A SALE AGREEMENT DATED 30 .03. 2 012. T HE SAID PROPERTY WAS IN THE JOINT NAMES OF THE ASSESSEE AND HER SPOUSE SHRI VIVEK GROVER AND EACH OF THEM HAD RECEIVED .1,65,00,000/ - AS SALE CONSIDERATION. THE SAID PROPERTY WAS E ARLIER P URCHASED BY THEM JOINTLY FOR A CONSIDERATION OF .68,32,20 0 / - ON 16 .0 7 . 2001. T HE TOTAL PURCHASE CONSIDERATION INCLUDING REGISTRATION CHARGE S ETC ., WAS .7 7 ,89,320/ - . ON PERUSAL OF THE RECORDS, THE ASSESSING OFFICER HAS NOTICED THAT THE ASSESSEE HAS INVESTED THE SALE PROCEEDS IN THE PURCHASE OF NEW PROPERTY TO CLAIM DEDUCTION U NDER SECTION 54 OF THE ACT. FOR THIS PURPOSE, SHE ALONG WITH HER HUSBAND HAS ENTERED INTO AN AGREEMENT WITH THE BUILDER M/ S. LANDMARK CONSTRUCTIONS ON 28 .0 3 . 2013 FOR CONSTRUCTI ON OF A FLAT. IT WAS NOTICED FROM THE SAID AGREEMENT THAT THE VALUE OF UNDIVIDED SHARE OF THE LAND AT .65,79,000/ - AND AN AMOUNT OF .1,45,21,000/ - WAS TO BE I.T.A. NO. 529 /M/16 3 INVESTED FOR THE CONSTRUCTION OF THE PROPERTY. THE ASSESSEE HAS MADE THE PAYMENT OF .15,00,000 / - ON 30 .0 3 . 2013 AND .1,73,00,000/ - TOWARDS CONSTRUCTION OF THE FLAT ON 0 5 .0 4 . 2013 AND CLAIMED AS EXEMPT UNDER SECTION 54 OF THE ACT BY THE ASSESSEE IN HER REVISED RETURN OF INCOME FILED ON 01 . 04 . 2013. 4. T HE A SSESSING OFFICER HAS OBSERVED THAT THE AMOUNT OF CAPITAL GAIN WAS NEITHER INVESTED IN THE NEW - HOUSE PROPERTY WITHIN THE DUE DATE PRESCRIBED FOR FIL ING THE RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT NOR WAS IT DEPOSITED INTO CAPITAL GAIN ACCOUNT SCHEME WITH ANY OF THE NOTIFIED BANKS WITHIN THE SPECIFIED PERIOD I.E. THE DATE OF FILING OF THE RETURN OF INCOME U NDER SECTION 139(1) OF THE ACT I.E ., 30 . 09 .2012, AS MANDATED BY THE PROVISIONS OF SECTION 54 OF THE ACT. 5. BY RELYING UPON THE JUDGEMENTS OF DIFFERENT COURTS, THE A SSESSING O FFICER HAS HELD THAT THE ASSESSEE HAS NOT FULFILLED THE REQUISITE CONDITIONS FOR CLAIMING EXEMPTION OF SECTION 54 O F THE ACT AND THEREFORE, SHE WAS NOT ELIGIBLE TO CLAIM EXEMPTION OF LONG TERM CAPITAL GAINS OF .89,63,871/ - . 6. THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A). AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND CONSIDERING THE FACTS OF THE CASE, THE LD. CIT(A) HAS CONFIRMED THE ORDER OF THE ASSESSING OFFICER BY OBSERVING AS UN DER: I.T.A. NO. 529 /M/16 4 7. I HAVE GONE THROUGH THE FACTS AND THE CIRCUMSTANCES OF THE CASE, THE FINDINGS GIVEN BY THE AO AND THE SUBMISSIONS MADE BY THE APPELLANT DURING THE ASSESSMENT PROCEEDING AND ALSO DURING THE COURSE OF THE APPELLATE PROCEEDINGS. THE PROVISIONS OF SU B - SECTION (2) OF SECTION 54 READ AS FOLLOWS, 'THE AMOUNT OF THE CAPITAL GAIN WHICH IS NO. APPROPRIATED BY THE ASSESSEE TOWARDS THE PURCHASE OF THE NEW ASSET MADE WITHIN ONE YEAR BEFORE THE DATE ON WHICH THE TRANSFER OF THE ORIGINAL ASSET TO PLACE, OR WHICH IS NO UTILISED BY HIM FOR THE PURCHASE OR CONSTRUCTION OF THE NEW ASSET BEFORE THE DATE OF FURNISHING THE RETURN OF INCOME U/S 139, SHALL BE DEPOSITED BY HIM BEFORE FURNISHING SUCH A RETURN (SUCH A DEPOSIT BEING MADE IN ANY CASE NOT LATER THAN THAT DUE DA TE APPLICABLE IN THE CASE OF THE ASSESSEE FOR FURNISHING THE RETURN OF INCOME UNDER SUB SECTION (1) OF SECTION 139) IN AN ACCOUNT IN ANY SUCH BANK OR INSTITUTION AS MAY BE SPECIFIED IN, AND UTILISED IN ACCORDANCE WITH, ANY SCHEME WHICH THE CENTRAL GOVERNME NT MAY, BY NOTIFICATION IN THE OFFICIAL GAZETTE, FRAMING THIS BEHALF AND SUCH A RETURN SHALL BE ACCOMPANIED BY PROOF OF SUCH A DEPOSIT, AND ARE, FOR THE PURPOSE OF SUBSECTION (1), THE AMOUNT, IF ANY, ALREADY UTILISED BY THE ASSESSEE FOR THE PURCHASE OR CON STRUCTION OF THE NEW ASSET TOGETHER WITH THE AMOUNTS ARE DEPOSITED SHALL BE DEEMED TO BE THE COST OF THE NEW ASSET.' 8. FROM THE PERUSAL OF SECTION 54(2), IT IS EVIDENT THAT THIS SECTION REFERS TO THE WORDS 'BEFORE THE DATE OR 'BEFORE THE DUE DATE' BEF ORE WHICH EITHER THE CAPITAL GAIN HAS TO BE INVESTED IN THE PURCHASE OF NEW PROPERTY OR TO BE DEPOSITED IN THE CAPITAL GAINS SCHEME ACCOUNT. THE WORDS 'BEFORE THE DATE' OR 'BEFORE THE DUE DATE' ARE MENTIONED ONLY IN SECTION 139(1) OF THE ACT AND NOWHERE IN OTHER SUB SECTIONS OF SECTION 139 OF THE ACT. SUB - SECTION 4 OF SECTION 139 (FILING OF BELATED RETURN) STATES 'THAT ANY PERSON WHO HAS NOT FURNISHED A RETURN WITHIN THE TIME ALLOWED TO HIM UNDER SUBSECTION (1) SECTION 139 . MAY FURNISH THE RETURN FOR ANY AT ANY TIME BEFORE THE EXPIRY OF ONE YEAR FROM THE END OF THE RELEVANT ASSESSMENT YEAR OR BEFORE THE COMPLETION OF THE ASSESSMENT, WHICHEVER IS EARLIER.' THERE IS NO MENTION OF THE WORDS LIKE 'BEFORE THE DATE' OR 'BEFORE THE DUE DATE' IN THIS SUB - SECTION. SIMILARLY, SUB - SECTION (5) OF SECTION 139 (FURNISHING OF THE REVISED RETURN) READS AS 'IF ANY PERSON, HAVING FURNISHED A RETURN UNDER SUBSECTION (1), OR IN PURSUANCE OF , DISCOVERS ANY OMISSION OR ANY WRONG STATEMENT THEY ARE, HE MAY FURNISH A REVISED RE TURN AT ANY TIME BEFORE THE EXPIRY OF ONE YEAR FROM THE END OF THE RELEVANT ASSESSMENT YEAR OR BEFORE THE COMPLETION OF THE ASSESSMENT, WHICHEVER IS EARLIER.' HERE ALSO THERE IS NO REFERENCE TO THE WORDS LIKE BEFORE THE DATE' OR 'BEFORE THE DUE DATE' WHIC H ARE AVAILABLE ONLY IN SUB - SECTION (1) OF SECTION 139 OF THE ACT. SECTION 139(1) OF THE ACT TALKS ABOUT THE DATE BY WHICH THE RETURN OF INCOME HAS TO BE FURNISHED IN THE NORMAL COURSE. THE OTHER SUB - SECTIONS (4) & (5) OF SECTION 139 DO NOT SPEAK ABOUT TH E WORD DATE BUT THEY ONLY REFER TO THE WORD YEAR. THE WORD DATE IS VERY SPECIFIC. SUBSECTION (2) OF SECTION 54 ALSO SPECIFICALLY REFERS TO THE WORD DATE. THE SENTENCE ' . WHICH IS NOT UTILISED BY HIM FOR THE PURCHASE OR CONSTRUCTION OF THE NEW ASSET BEFOR E THE DATE OF FURNISHING THE RETURN OF I.T.A. NO. 529 /M/16 5 INCOME U/S 139' ..... INSERTED IN SECTION 54(2), CLEARLY INDICATES TOWARDS THE ASSERTION THAT THE INVESTMENT OR DEPOSIT IN THE CAPITAL GAINS ACCOUNT SCHEME MUST BE MADE BEFORE THE SPECIFIC TIME I.E. THE DUE DATE FOR F ILING OF THE INCOME TAX RETURN. THE SECOND PART OF SECTION 50(2) IS MORE CATEGORICAL WHEN IT SAYS THAT THE AMOUNT OF THE CAPITAL GAIN WHICH IS NOT APPROPRIATED BY THE ASSESSEE TOWARDS THE PURCHASE OF THE NEW ASSET............ SHALL BE DEPOSITED BY HIM BEFO RE FURNISHING SUCH A RETURN (SUCH A DEPOSIT BEING MADE IN ANY CASE NOT LATER THAN THE DUE DATE APPLICABLE IN THE CASE OF THE ASSESSEE FOR FURNISHING THE RETURN OF INCOME UNDER SUBSECTION (1) OF SECTION 139). HENCE THE RELEVANT PROVISIONS OF THE ACT CLEARLY VINDICATE THE STAND TAKEN BY THE AO WHEN HE HELD THAT THE ASSESSEE HAS FAILED TO COMPLY WITH THE PROVISIONS OF SECTION 54 OF THE ACT. 9. THEREFORE, IN VIEW OF THE SPECIFIC PROVISIONS OF 54(2) R.W.S 139(1) OF THE ACT, I AM OF THE OPINION THAT THE INTERP RETATION OF SECTION 54(2) MADE BY THE APPELLANT TO BRING IN TO ITS AMBIT THE PROVISIONS OF SUB - SECTION (5) OF SECTION 139, WAS INCORRECT. HENCE, IN MY CONSIDERED VIEW, THE ASSESSEE WAS REQUIRED TO INVEST THE CAPITAL GAIN IN THE NEW PROPERTY BEFORE THE DUE DATE FOR FILING OF RETURN OF INCOME AS STIPULATED U/S 139(1) OF THE ACT FOR THE RELEVANT YEAR UNDER CONSIDERATION. MOREOVER, IF THE CAPITAL GAIN WAS NOT APPROPRIATED BY THE ASSESSEE TOWARDS THE PURCHASE OF THE NEW ASSET WITHIN THE STIPULATED TIME PERIOD, T HE SAME MUST HAVE BEEN DEPOSITED IN THE CAPITAL GAINS SCHEME ACCOUNT BEFORE THE DUE DATE AS STIPULATED U/S 139(1) FOR THE RELEVANT YEAR UNDER CONSIDERATION. 10. THE AO HAS RIGHTLY PLACED RELIANCE ON THE CASE OF ITO WARD 1 KANPUR VS. SMT ROSAMMAKORAL (20 14) 45 TAXMANN.COM 153 (COCHIN TRIBUNAL), WHEREIN IT HAS BEEN HELD THAT SINCE THE ASSESSEE HAS NOT DEPOSITED THE UN - UTILISED CAPITAL GAIN IN CAPITAL GAIN ACCOUNT SCHEME WITHIN THE DUE DATE PROVIDED U/S139(1), THE ASSESSEE'S CLAIM THAT DUE .DATE U/S 139(4) SHOULD BE CONSIDERED, WAS RIGHTLY REJECTED BY THE TRIBUNAL BASED ON APEX COURT'S DECISION IN PRAKASH NATH KHANNA VS CIT(2004) 260 ITR 1/135 TAXMAN 327. IN THIS CASE, THE HONOURABLE SUPREME COURT HELD AS UNDER: 'ONE OF THE SIGNIFICANT TERMS USED IN SECTIO N 276CC IS 'IN DUE TIME'. THE TIME WITHIN WHICH THE RETURN IS TO BE FURNISHED IS INDICATED ONLY IN SUB - SECTION (1) OF SECTION 139 AND NOT IN SUB - SECTION (4) OF SECTION 139. THAT BEING SO, EVEN IF A RETURN IS FILED IN TERMS OF SUB - SECTION (4) OF SECTION 139 , THAT WOULD NOT DILUTE THE INFRACTION IN NOT FURNISHING THE RETURN IN DUE TIME AS PRESCRIBED UNDER SUB - SECTION (1) OF SECTION 139. OTHERWISE, THE USE OF THE EXPRESSION 'IN DUE TIME' WOULD LOOSE ITS RELEVANCE AND IT CANNOT BE SAID THAT THE SAID EXPRESSION WAS USED WITHOUT ANY PURPOSE. BEFORE SUBSTITUTION OF THE EXPRESSION 'CLAUSE (I) OF SUB - SECTION (1) OF SECTION 142' BY DIRECT TAX LAWS (AMENDMENT) ACT, 1987 WITH EFFECT FROM 1 - 4 - 1989, THE EXPRESSION USED WAS 'SUB - SECTION (2) OF SECTION 139'. AT THE RELEVANT POINT OF TIME, THE ASSESSING I.T.A. NO. 529 /M/16 6 OFFICER WAS EMPOWERED TO ISSUE A NOTICE REQUIRING FURNISHING OF A RETURN WITHIN THE TIME INDICATED THEREIN. THAT MEANS THE INFRACTIONS WHICH ARE COVERED BY SECTION 276CC RELATE TO NON - FURNISHING OF RETURN WITHIN THE TIME IN TE RMS OF SUB - SECTION (1) OR INDICATED IN THE NOTICE GIVEN UNDER SUB - SECTION (2) OF SECTION 139. THERE IS NO CONDONATION OF THE SAID INFRACTION, EVEN IF A RETURN IS FILED IN TERMS OF SUB - SECTION (4). ACCEPTING SUCH A PLEA WOULD MEAN THAT A PERSON WHO HAD NOT FILED A RETURN WITHIN THE DUE TIME AS PRESCRIBED UNDER SUB - SECTION (1) OR (2) OF SECTION 139 WOULD GET BENEFIT BY FILING THE RETURN UNDER SECTION 139(4) MUCH LATER. THIS CANNOT CERTAINLY BE THE LEGISLATIVE INTENT. 11. THEREFORE, KEEPING IN VIEW THE FACT S AND CIRCUMSTANCES OF THE CASE AND ALSO FOLLOWING THE RATIO OF THE ABOVE DISCUSSED JUDGEMENTS, AS THE ASSESSEE HAS FAILED TO INVEST IN THE NEW PROPERTY OR DEPOSIT IN THE CAPITAL GAINS SCHEME ACCOUNT BEFORE THE DUE DATE OF FILING OF THE RETURN OF INCOME ON OR BEFORE I.E. 30109/2012 FOR THE RELEVANT YEAR UNDER CONSIDERATION, SHE IS NOT ENTITLED TO CLAIM ANY DEDUCTION U/S 54 OF THE ACT. THEREFORE, THE ACTION OF THE AO IS CONFIRMED. 7. ON BEING AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. THE LD. COUNSEL FOR THE ASSESSEE HAS SUBMITTED THAT ONCE THE LD. CIT(A) HAS NOT FOUND ANY FAULT WITH THE ASSESSEE SINCE THE ASSESSEE HAS APPROPRIATED THE CAPITAL GAINS INCOME TOWARDS CONSTRUCTION OF NEW RESIDENTIAL FLAT BEFORE THE FILING OF THE RETURN OF INCOM E UNDER SECTION 139(4) OF THE ACT, HE CANNOT SUSTAIN THE DISALLOWANCE MADE BY THE ASSESSING OFFICER AND PRAYED THAT THE DISALLOWANCE SUSTAINED BY THE LD. CIT(A) SHOULD BE DELETED. ON THE OTHER HAND, THE LD. DR STRONGLY SUPPORTED THE ORDERS OF AUTHORITIES BELOW. 8. WE HAVE HEARD BOTH PARTIES, PERUSED THE MATERIALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF AUTHORITIES BELOW. IN THIS CASE, THE ASSESSEE SOLD A RESIDENTIAL PROPERTY FOR A SALE CONSIDERATION OF .3,30,00,000/ - TO TWO PERSONS THROUGH A SALE AGREEMENT DATED 30 .03. 2 012. T HE SAID PROPERTY WAS I.T.A. NO. 529 /M/16 7 IN THE JOINT NAMES OF THE ASSESSEE AND HER SPOUSE SHRI VIVEK GROVER AND EACH OF THEM HAD RECEIVED .1,65,00,000/ - AS SALE CONSIDERATION. THE SAID PROPERTY WAS EARLIER PURCHASED BY THEM JOINTLY FOR A C ONSIDERATION OF .68,32,20 0 / - ON 16 .0 7 . 2001. T HE TOTAL PURCHASE CONSIDERATION INCLUDING REGISTRATION CHARGE S ETC ., WAS .7 7 ,89,320/ - . ON PERUSAL OF THE RECORDS, THE ASSESSING OFFICER HAS NOTICED THAT THE ASSESSEE HAS INVESTED THE SALE PROCEEDS IN THE PURCH ASE OF NEW PROPERTY TO CLAIM DEDUCTION U NDER SECTION 54 OF THE ACT. FOR THIS PURPOSE, SHE ALONG WITH HER HUSBAND HAS ENTERED INTO AN AGREEMENT WITH THE BUILDER M/ S. LANDMARK CONSTRUCTIONS ON 28/3/2013 FOR CONSTRUCTION OF A FLAT. IT WAS NOTICED FROM THE SAI D AGREEMENT THAT THE VALUE OF UNDIVIDED SHARE OF THE LAND AT .65,79,000/ - AND AN AMOUNT OF .1,45,21,000/ - WAS TO BE INVESTED FOR THE CONSTRUCTION OF THE PROPERTY. THE ASSESSEE HAS MADE THE PAYMENT OF .1,73,00,000/ - TOWARDS CONSTRUCTION OF THE FLAT ON 0 5 .0 4 . 2013 AND .15,00,000 / - ON 30 .0 3 . 2013. THIS INVESTMENT HAS BEEN MADE ON 30/3/2013 AND FILED HER REVISED RETURN OF INCOME ON 01 . 04 . 2013 UNDER SECTION 139(4) OF THE ACT BY CLAIM ING DEDUCTION UNDER SECTION 54 OF THE ACT . THE ASSESSING OFFICER REJECTED ASSESSEE S CLAIM OF EXEMPTION UNDER SECTION 54 OF THE ACT, SINCE THE AMOUNT OF CAPITAL GAIN WAS NEITHER INVESTED IN THE NEW - HOUSE PROPERTY WITHIN THE DUE DATE PRESCRIBED FOR FILING THE RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT NOR WAS IT DEPOSITED INTO CAPITAL GAIN ACCOUNT SCHEME WITH ANY OF THE NOTIFIED BANKS WI THIN THE SPECIFIED PERIOD I.E. THE DATE OF FILING OF THE RETURN OF INCOME U NDER I.T.A. NO. 529 /M/16 8 SECTION 139(1) I.E ., 30 . 09 .2012, AS MANDATED BY THE PROVISIONS OF SECTION 54 OF THE ACT AND DISALLOWED THE CLAIM OF THE ASSESSEE. THE LD. CIT(A) CONFIRMED THE DISALLOWANCE MADE ON THIS ACCOUNT. 9. THE ASSESSEE HAS FILED RETURN OF INCOME UNDER SECTION 139(1) OF THE ACT ON 30.09.2012 ADMITTING NIL INCOME AND SUBSEQUENTLY, FILED REVISED RETURN OF INCOME NIL ON 01.04.2013 UNDER SECTION 139(4) OF THE ACT. THE ASSESSING OFFICER SEL ECTED THE REVISED RETURN FILED BY THE ASSESSEE FOR SCRUTINY. THE INVESTMENT IN THE PURCHASE OF NEW PROPERTY OUT OF SALE PROCEEDS IS NOT IN DISPUTE. CONSIDERING THE DATE OF INVESTMENTS AND PROVISIONS OF LAWS , FOLLOWING DETAILS HAVE BEEN NOTED AS UNDER: - (I) DATE OF TRANSFER OF ORIGINAL ASSET : 30.03.2012 (II) ASSESSEE S SHARE : .1,65,00,000/ - (III) AMOUNT TO BE INVESTED FOR CONSTRUCTION OF THE PROPERTY : .1,45,21,000/ - (IV) DUE DATE OF FILING RETURN FOR THE ASSESSMENT YEAR 2012 - 13 : 31.07.2012 (V) DATE OF AGREEMENT FOR CONSTRUCTION : 28.03.2013 (V I ) DATE AND AMOUNT PAID FOR CONSTRUCTION OF THE NEW FLAT : .15,00,000/ - ON 30.03.2013 .1,73,00,000/ - ON 05.04.2013 (VI I ) DUE DATE OF FILING OF BELATED RETURN UNDER SECTION 139(4) OF THE ACT : 31.03.2014 THE PROVISIONS OF SECTION 54 OF THE ACT ARE BENEFICIAL AND ARE TO BE CONSI DERED LIBERALLY FOR REASONABLE BONAFIDE CAUSE BUT INVESTMENT IN RESIDENTIAL PROPERTY IS MANDATORY WHICH THE ASSESSEE HAS PROVED WITH SUBSTANTIAL EVIDENCE BEFORE THE LOWER AUTHORITIES. PRIME FACIE , THE ASSESSEE PAID THE AMOUNT FOR ACQUISITION OF NEW FLAT GO T CONSTRUCTED THROUGH THE BUILDER MUCH BEFORE THE EXTENDED DUE DATE U NDER SECTION 139(4) OF THE ACT. I.T.A. NO. 529 /M/16 9 THE ASSESSEE WAS IDENTIFYING THE NEW PROPERTY; THE INVESTMENT IN THE NEW PROPERTY WAS MADE ONLY ON 28.03.2013. THE ASSESSEE HAS DIRECT INVESTMENT IN HOUSE PROPERTY AND THEREFORE NOT OPTED IN CAPITAL GAIN ACCOUNT SCHEME. THE ASSESSEE HAS NOT INVESTED IN CAPITAL GAIN ACCOUNT SCHEME BEFORE 139(1) OF THE ACT, BUT COMPLIED WITH THE CONDITIONS UNDER SECTION 54F(1) OF THE ACT BY PURCHASING AND CONSTRUCTION OF RESID ENTIAL PROPERTY WITHIN THREE YEARS FROM THE DATE OF TRANSFER OF ORIGINAL ASSET WHICH WAS NOT DISPUTED IN THE ASSESSMENT PROCEEDINGS OR IN APPELLATE PROCEEDINGS. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER SUBSTANTIATED ARGUMENTS WITH JUDICIAL DECISION OF DELHI HIGH COURT IN THE CASE OF CIT VS. R.L. SOOD 245 ITR 727 (DEL) WERE THE DATE OF AGREEMENT TO PURCHASE SHOULD BE TAKEN AS THE DATE OF PURCHASE. ON APPLYING THE RATIO TO CURRENT CIRCUMSTANCES, THE ASSESSEE ENTERED INTO CONSTRUCTION AGREEMENT AND AGREEME NT FOR LAND PURCHASE ON 28.03.2013, WHICH WAS NOT AT ALL DISPUTED BY THE DEPARTMENT, VERY MUCH BEFORE PROVISIONS OF S EC TION 139( 4 ) OF THE ACT. IN THE CASE OF JAGTAR SINGH CHAWLA OF PUNJAB AND HARYANA HIGH COURT IN ITA NO.71 OF 2012, DATED 20.03.2013 THE AS SESSEE HAS PAID SUBSTANTIAL AMOUNT FOR PURCHASE OF RESIDENTIAL PROPERTY BEFORE THE EXTENDED DUE DATE OF FILING OF RETURN AND THE ASSESSEE WAS ELIGIBLE FOR EXEMPTION AND NOT LIABLE TO PAY ANY CAPITAL GAIN TAX. SIMILAR VIEW WAS ALSO TAKEN BY THE MUMBAI BENCH ES OF THE TRIBUNAL IN THE CASE OF ANIL KUMAR AURORA REPORTED IN [2013] 37 CCH 221 (MUM). FURTHER, IN THE CASE OF RAJESH KUMAR JALAN 286 ITR 274, THE HON BLE GAUHATI HIGH COURT HAS HELD I.T.A. NO. 529 /M/16 10 THAT THE CAPITAL GAINS IS NOT CHARGEABLE WHEN THE ASSESSEE HAS PURCHASE D THE NEW PROPERTY BEFORE THE EXTENDED DUE DATE OF FILING OF RETURN UNDER SECTION 139(4) OF THE ACT FOR THE PURPOSE OF CLAIMING DEDUCTION UNDER SECTION 54 OF THE ACT. MOREOVER, THE COORDINATE BENCHES OF THE TRIBUNAL IN THE CASE OF MADHUVANPRASAD IN I.T.A. NO. 2485/MDS/2004 AND IN THE CASE OF K.S. RAMACHANDRAN IN I.T.A. NO. 941/MDS/2011 HAS HELD THAT UTILIZATION OF THE FUNDS IN CONSTRUCTING THE RESIDENTIAL HOUSE WITHIN THE STIPULATED PERIOD SHOULD BE TREATED AS SUFFICIENT COMPLIANCE OF SECTION 54 OF THE ACT. 10. THE LD. COUNSEL FOR THE ASSESSEE HAS FURTHER RELIED ON THE DECISION OF THE COORDINATE BENCHES OF THE TRIBUNAL IN THE CASE OF SHRI A.C. SHYAM SUNDAR V. JCIT IN I.T.A. NO. 2279/MDS/2015 DATED 06.05.2016, WHEREIN, THE ASSESSEE WAS ALLOWED LTCG UNDER SEC TION 54F OF THE ACT ON SIMILAR FACTS AND CIRCUMSTANCES. CONSIDERING THE FACTUAL ASPECTS, GENUINE NE SS OF TRANSACTIONS AND BENEFICIAL AND LIBERAL ASPECTS OF THE PROVISIONS AND THE JUDICIAL DECISIONS RELIED BY THE ASSESSEE , W E ARE OF THE OPINION THAT ASSESSEE HAS COMPLIED WITH THE CONDITIONS AND IS ELIGIBLE FOR EXEMPTION U NDER SECTION 54 OF THE ACT. 11. ON SIMILAR FACTS AND CIRCUMSTANCES, THE VERY SAME DIVISION BENCH, IN THE CASE OF ACIT V. SMT. UMAYAL ANNAMALAI IN I.T.A. NO. 415/MDS/2015 FOR THE ASSESSMENT YEAR 2005 - 06 DATED 22.04.2015 AS WELL AS IN THE CASE OF SHRI S.R. JEYASHANKAR V. ITO IN I.T.A. NO. 2930/MDS/2013 FOR THE I.T.A. NO. 529 /M/16 11 ASSESSMENT YEAR 2012 - 13 VIDE ORDER DATED 03.04.2017, DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. THUS, W E SET ASIDE THE ORDER OF LD. CIT(A) AND DIRECT THE ASSESSING OFFICER TO GRANT THE FULL LTCG EXEMPTION UNDER SECTION 54 OF THE ACT , WHICH WAS INVESTED IN THE RESIDENTIAL PROPERTY BEFORE DUE DATE U NDER SECTION 139(4) OF THE ACT. THE GROUND RAISED BY THE ASSESSEE IS ALLOWED. 12 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED . ORDER PRONOUNCED ON THE 26 TH MAY , 201 7 AT CHENNAI. SD/ - SD/ - ( CHANDRA POOJARI ) ACCOUNTANT MEMBER ( DUVVURU RL REDDY ) JUDICIAL MEMBER CHENNAI, DATED, THE 26 . 0 5 .201 7 VM/ - / COPY TO: 1. / APPELLANT , 2. / RESPONDENT , 3. ( ) / CIT(A) , 4. / CIT , 5. / DR & 6. / GF.