M/s. Harvinder Singh, Delhi V. ACIT, New Delhi

ITA 728/DEL/2017

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 2113 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 9 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2013-2014
• Appeal Filed On: 08-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S N MEENA
• Keywords: Advance ruling; Capital Gains
• Section: 54F; 54

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI C BEN CH, NEW DELHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND MS. SUCHITRA KAMBLE, JUDICIAL M EMBER ITA NO. 728/DEL/2017 [A.Y 2013-14] SHRI HARVINDER SINGH VS. THE A.C.I.T C/O BHATIA BEHL & ASSOCIATES CIRCLE 28(1) 26/8, BASEMENT OLD RAJINDER NAGAR NEW DELHI DELHI PAN: APOPS 6580 A (APPLICANT) ( RESPONDENT) ASSESSEE BY : SHRI R.S. SIN GHVI, CA DEPARTMENT BY : SHRI S.N. MEENA, SR. DR DATE OF HEARING : 03.12.2019 DATE OF PRONOUNCEMENT : 04.12.2019 ORDER PER N.K. BILLAIYA, ACCOUNTANT MEMBER, THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST TH E ORDER OF THE COMMISSIONER OF INCOME TAX [APPEALS] - 10, NEW DELH I DATED 21.03.2016 PERTAINING TO ASSESSMENT YEAR 2013-14. 2 2. THE SOLITARY OF THE GRIEVANCE OF THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF CLAIM OF EX EMPTION U/S 54/54F OF THE INCOME TAX ACT, 1961 [HEREINAFTER REFERRED T O AS 'THE ACT' FOR SHORT]. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT D URING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER FOUND WORKING OF LONG TERM CAPITAL GAINS AND DEDUCTION U/S 54/54F OF THE ACT AS FOLLOWS: RESIDENTIAL HOUSE NO. G 17, RS. 2.40 CRORE LAJPAT NAGAR III, NEW DELHI 1/3 RD SHARE IN FACTORY BUILDING AT A-72, OKHLA INDUSTRIAL AREA, NEW DELHI RS. 1.28 CRORES 4. THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS PURCHASED A RESIDENTIAL HOUSE IN AUCKLAND, NEW ZEALAND FOR A SU M OF RS. 6.87 CRORES. THE ASSESSING OFFICER WAS OF THE FIRM BELI EF THAT ANY RESIDENTIAL HOUSE PURCHASED OUTSIDE INDIA IS NOT EL IGIBLE FOR DEDUCTION U/S 54 AND 54F OF THE ACT. DRAWING SUPPORT FROM THE PROVISIONS OF SECTION 54 OF THE ACT, THE ASSESSING OFFICER CONCLU DED BY DENYING THE CLAIM OF EXEMPTION. 3 5. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. C IT(A) BUT WITHOUT ANY SUCCESS. 6. WHILE DISMISSING THE CLAIM OF THE ASSESSEE, THE LD. CIT(A) PLACED RELIANCE ON THE DECISION OF THE CO-ORDINATE BENCH I N THE CASE OF LEENA J. SHAH ORDER DATED 10.11.2005 7. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE VEHE MENTLY STATED THAT THE AMENDMENT BROUGHT IN SECTION 54 IS W.E.F 0 1.04.2015 AND SINCE THE A.Y UNDER CONSIDERATION IS A.Y 2013-14, T HE SAID AMENDMENT IS NOT APPLICABLE FOR THE YEAR UNDER CONSIDERATION. THE LD. COUNSEL FOR THE ASSESSEE PLACED RELIANCE ON THE DECISION OF AUT HORITY FOR ADVANCE RULINGS, NEW DELHI IN THE CASE OF MOHAN GHOSH 401 I TR 129 [AAR, NEW DELHI] AND ALSO ON THE DECISION OF THE CO-ORDINATE BENCH IN THE CASE OF ANURAG PANDIT ITA NO. 4159/DEL/2016 ORDER DATED 23. 05.2018. 8. PER CONTRA, THE LD. DR STRONGLY SUPPORTED THE FI NDINGS OF THE LD. CIT(A). IT IS THE SAY OF THE LD. DR THAT THE AMEND MENT IS CLEAR AND UNAMBIGUOUS AND NO DEDUCTION CAN BE ALLOWED TO THE ASSESSEE AS PER THE AMENDMENT PROVISIONS OF SECTION 54F. 4 9. WE HAVE GIVEN THOUGHTFUL CONSIDERATION TO THE OR DERS OF THE AUTHORITIES BELOW. THE UNDISPUTED FACT IS THAT BY SELLING THE PROPERTY SITUATED IN INDIA, THE ASSESSEE HAS PURCHASED A RES IDENTIAL PROPERTY IN AUCKLAND, NEW ZEALAND. IT IS EQUALLY TRUE THAT THE AMENDMENT HAS BEEN BROUGHT IN SECTION 54 VIDE FINANCE ACT, 2014 W .E.F 01.04.2015. WE ARE OF THE CONSIDERED OPINION THAT THE LEGISLATU RE, IN ITS WISDOM, HAS GIVEN EFFECT TO THE AMENDED PROVISION FROM 01.0 4.2015 AND, THEREFORE, THERE IS NO AMBIGUITY AS THE SAID PROVIS IONS ARE EFFECTIVE FROM A.Y 2015-16. 10. SIMILAR VIEW WAS TAKEN BY THE AUTHORITY FOR ADV ANCE RULINGS, NEW DELHI IN THE CASE OF DIPANKAR MOHAN GHOSH [SUPRA]. MOREOVER, WE FIND THAT THE DECISION HEAVILY RELIED UPON BY THE FIRST APPELLATE AUTHORITY HAS BEEN REVERSED BY THE HON'BLE HIGH COURT OF GUJA RAT IN 392 ITR 18. WE FIND THAT THE HON'BLE HIGH COURT HAS HELD WE AR E OF THE OPINION THAT BENEFIT OF SECTION 54F BEFORE ITS AMENDMENT CA N BE EXTENDED TO A RESIDENTIAL HOUSE PURCHASED OUTSIDE INDIA. 11. CONSIDERING THE FACTS OF THE CASE IN TOTALITY, IN LIGHT OF THE JUDICIAL DECISIONS DISCUSSED HEREINABOVE, WE DIRECT THE ASSESSING OFFICER TO ALLOW THE CLAIM OF DEDUCTION. 5 12. IN THE RESULT, THE APPEAL OF THE ASSESSEE IN IT A NO. 728/DEL/2017 IS ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 04.12 .2019. SD/- SD/- [ SUCHITRA KAMBLE ] [N.K. BILLAIYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 04 TH DECEMBER, 2019 VL/ COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR ASST. REGISTRAR, ITAT, NEW DELHI 6 DATE OF DICTATION DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.PS /PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P S/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WE BSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER