ACIT-16(1), MUMBAI V. MEENA ANAND BHATT, MUMBAI

ITA 6546/MUM/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 88667 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 07-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AKHILENDRA YADAV
• Keywords: Capital asset

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, MUMBAI , , BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 6546/MUM/2013 ( / ASSESSMENT YEAR : 2009 - 10 THE ACIT - 16(1), MATRU MANDIR, TARDEO ROAD, MUMBAI - 400 007 / VS. SMT. MEENA ANAND BHATT, 4 - A, M.L. DAHANUKAR MARG, CARMICHAEL ROAD, MUMBAI ./ ./ PAN/GIR NO. : AKSPB 1812H ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI AKHILENDRA YADAV / RESPONDENT BY : SHRI DEEPAK SHAH / DATE OF HEARING 31 : . 0 3 .2015 / DATE OF PRONOUNCEMENT : 31 .03 .2015 / O R D E R PER N.K. BILLAIYA, AM: WITH THIS APPEAL THE REVENUE HAS CHALLENGED THE CORRECTNESS OF THE ORDER OF THE LD. CIT(A) - 27, MUMBAI DT. 22.8.2013 PERTAINING TO ASSESSMENT YEAR 2009 - 10. 2. THE SOLE GRIEVANCE OF THE REVENUE IS THAT THE LD. CIT(A) ERRED IN DELETING THE EXCESS EXEMPTION CLAIMED BY THE ASSESSEE U/S. 50EC OF THE ACT. ITA. NO. 6546/MUM/2013 2 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT DURING THE COURSE OF THE ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS CLAIMED EXEMPTION OF RS. 60 LAKHS U/S. 54EC OF THE ACT. THE AO WAS OF THE FIRM BELIEF THAT AFTER THE 1 ST DAY OF APRIL, 2007 , INVESTMENT IN LONG TERM SPE CIFIED ASSET CANNOT EXCEED RS. 50 LAKHS AND AS THE ASSESSEE HAS INVESTED 60 LAKHS, SHE IS NOT ELIGIBLE FOR EXEMPTION IN RESPECT OF EXCESS CLAIM OF RS. 10 LAKHS. THE ASSESSEE WAS SHOW CAUSED TO EXPLAIN HER CLAIM. THE ASSESSEE EXPLAINED THAT INVESTMENT HAS BEEN MADE IN TWO PARTS I.E. RS. 50 LAKS IN FINANCIAL YEAR 2008 - 09 AND RS. 10 LAKHS IN FINANCIAL YEAR 2009 - 10. IT WAS FURTHER EXPLAINED THAT BOTH THE INVESTMENTS HAVE BEEN MADE WITHIN THE PERIOD OF 6 MONTHS FROM THE DATE OF TRANSFER AND THE CAP OF RS. 50 LAKHS AS PER FINANCIAL YEAR, THEREFORE, THE ASSESSEE IS ELIGIBLE FOR THE CLAIM OF EXEMPTION. THE EXPLANATION OF THE ASSESSEE DID NOT FIND ANY FAVOUR WITH THE AO. THE AO PROCEEDED BY DENYING THE CLAIM OF EXEMPTION IN RESPECT OF THE EXCESS INVESTMENT OF RS . 10 LAKHS. 4. AGGRIEVED BY THIS, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) AND REITERATED HER CLAIM. AFTER CONSIDERING THE FACTS AND THE SUBMISSIONS AND DRAWING SUPPORT FROM THE DECISION OF THE TRIBUNAL CHENNAI BENCH IN ITA NO. 1950/MDS/201 2 AND ALSO FROM THE DECISION OF THE TRIBUNAL AHMEDABAD BENCH IN ITA NOS. 3226 & 3227/AHD/2011, THE LD. CIT(A) HELD THAT THE ASSESSEE IS ELIGIBLE FOR CLAIMING DEDUCTION OF RS. 60 LAKHS SPREAD OVER TWO YEARS. 5. THE REVENUE IS BEFORE US AGAINST THIS FINDI NG OF THE LD. CIT(A). 6. THE LD. DEPARTMENTAL REPRESENTATIVE STRONGLY SUPPORTED THE ASSESSMENT ORDER. ITA. NO. 6546/MUM/2013 3 7. THE LD. COUNSEL FOR THE ASSESSEE REITERATED WHAT HAS BEEN SUBMITTED BEFORE THE LOWER AUTHORITIES. THE LD. COUNSEL FURTHER RELIED UPON THE DECISION OF THE HONBLE MADRAS HIGH COURT IN THE CASE OF CIT VS C. JAICHANDER 53 TAXMANN.COM 466. THE LD. COUNSEL ALSO RELIED UPON THE DECISION OF THE TRIBUNAL MUMBAI BENCH IN THE CASE OF MRS. LILAVATI M. SAYANI VS ITO 49 TAXMANN.COM 579. 8. WE HAVE CAREFULLY PERUSED THE ORDERS OF THE AUTHORITIES BELOW AND THE RELEVANT DECISIONS RELIED UPON BY THE ASSESSEE. THE SHORT ISSUE TO BE DECIDED IS, WHETHER THE CAP OF RS. 50 LAKHS PROVIDED U/S. 54EC OF THE ACT IS PER FINANCIAL YEAR OR PER TRANSACTION. THE UNDISPUTED FACT IS THAT THE ASSESSEE HAS INVESTED RS. 50 LAKHS AND 10 LAKHS IN TWO DIFFERENT FINANCIAL YEARS BUT WITHIN A PERIOD OF 6 MONTHS FROM THE DATE OF TRANSFER OF CAPITAL ASSET. MEANING THEREBY THAT THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S. 54EC OF THE ACT. THIS ISSUE IS NO MORE RES - INTEGRA AND IS WELL SETTLED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE BY THE DECISION OF THE HONBLE MADRAS HIGH COURT (SUPRA) AND FOLLOWED BY THE TRIBUNAL MUMBAI BENCH IN THE CASE OF MRS. LILAVATI M. SAYANI (SUPRA). ON IDENTICAL SET OF FACTS, THE HONBLE MADRAS HIGH COURT HAS HELD AS UNDER: THE LEGISLATURE HAS CHOSEN TO REMOVE THE AMBIGUITY IN THE PROVISO TO SEC. 54EC (1) OF THE ACT BY INSERTING A SECOND PROVISO WITH EFFECT FROM 1.4.2015. THE MEMORANDUM EXPLAINING THE PROVISIONS IN THE FINANCE (NO.2) BILL, 2014 ALSO STATES THAT THE SAME WILL BE APPLICABLE FROM 1.4.2015 IN RELATION TO ASSESSMENT YEAR 2015 - 16 AND THE SUB SEQUENT YEARS. THE INTENTION OF THE LEGISLATURE PROBABLY APPEARS TO BE THAT THIS AMENDMENT SHOULD BE FOR THE ASSESSMENT YEAR 2015 - 2016 TO AVOID UNWANTED LITIGATIONS OF THE PREVIOUS YEARS. EVEN OTHERWISE, WE DO NOT WISH TO READ ANYTHING MORE INTO THE FIRS T PROVISO TO SEC. 54EC(1) OF THE ACT. AS IT STOOD IN RELATION TO THE ASSESSES. IN ANY EVENT, FROM A READING OF SECTION 54EC(1) AND THE FIRST PROVISO, IT IS CLEAR THAT THE TIME LIMIT FOR INVESTMENT IS SIX MONTHS FROM THE DATE OF TRANSFER AND EVEN IF SUCH INVESTMENT FALLS UNDER ITA. NO. 6546/MUM/2013 4 TWO FINANCIAL YEARS, THE BENEFIT CLAIMED BY THE ASSESSEE CANNOT BE DENIED. IT WOULD HAV MADE A DIFFERENCE, IF THE RESTRICTION ON THE INVESTMENT IN BONDS TO RS. 50,00,00/ - IS INCORPORATED IN SEC. 54EC(1) OF THE ACT ITSELF. HOWEVER, THE AMBIGUITY HAS BEEN REMOVED BY THE LEGISLATURE WITH EFFECT FROM 1.4.2015 IN RELATION TO THE ASSESSMENT YEAR 2015 - 16 AND THE SUBSEQUENT YEARS. FOR THE FOREGOING REASONS, WE FIND NO INFIRMITY IN THE ORDERS PASSED BY THE TRIBUNAL WARRANTING INTERFERENCE BY THIS COURT. THE SUBSTANTIAL QUESTIONS OF LAW ARE ANSWERED AGAINST THE REVEN UE AND THESE APPEALS ARE DISMISSED. NO COSTS. RESPECTFULLY FOLLOWING THE DECISION OF THE HONBLE MADRAS HIGH COURT, WE DECLINE TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). 9. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. OR DER PRONOUNCED IN THE OPEN COURT ON 31 ST MARCH, 2015 SD/ - SD/ - ( JOGINDER SINGH ) (N.K. BILLAIYA) / JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 31 ST MARCH, 2015 . . ./ RJ , SR. PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI