ITO, Coimbatore V. D.Rajeswari, Coimbatore

ITA 801/CHNY/2016

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 4904 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-04-2017
• Appeal Filed By: Department
• Bench Allotted: C
• Next Hearing Date: 04-01-2017
• Assessment Year: misc
• Appeal Filed On: 31-03-2016
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH
• Assessee Lawyers: T BANUSEKAR
• Keywords: Capital asset
• Section: 143(3); 54F; 148; 54; 139

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI . , ! . , & ! ' BEFORE SHRI ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI G. PAVAN KUMAR, JUDICIAL MEMBER ./ I.T.A. NO. 801/MDS/2016 / ASSESSMENT YEAR : 2010-11 INCOME TAX OFFICER, NON-CORPORATE WARD- 4(2), 63-A, RACE COURSE ROAD, COIMBATORE. VS. SMT. D. RAJESWARI, NO. 2/53, PILLAYAR KOIL STREET, J. MADAMPATTI, COIMBATORE - 641 010. [PAN: ALPPR 0679A] ( / APPELLANT) ( / RESPONDENT) ) * / APPELLANT BY : SHRI A.V. SREEKANTH, JCIT -.) * / RESPONDENT BY : SHRI T. BANUSEKAR, CA * /DATE OF HEARING : 04.01.2017 * /DATE OF PRONOUNCEMENT : 04.04.2017 /O R D E R PER G. PAVAN KUMAR, JUDICIAL MEMBER: THE REVENUE HAS FILED AN APPEAL AGAINST THE ORDER O F COMMISSIONER OF INCOME TAX (APPEALS)-2, COIMBATORE, IN ITA NO. 298/14-15 DATED 30.12.2015 PASSED U/S. 143 R.W.S. 147 AND 250 OF THE INCOME TA X ACT. :-2-: I.T.A. NO. 801/MDS/2016 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS: 2.1 THE LD. CIT(A) ERRED IN STATING THAT THE AMOUNT PAID AFTER DUE DATE OF FILING RETURN U/S. 139(1) QUALIFIES FOR DEDUCTION U /S. 54F. 2.2 THE LD. CIT(A) ERRED IN STATING THAT INVESTMENT OF CAPITAL GAINS ON PURCHASE OF A RESIDENTIAL PROPERTY WITHIN THE EXTEN DED PERIOD SPECIFIED U/S. 139(4) QUALIFIES FOR DEDUCTION 54F WHEREIN THE SECT ION CLEARLY STATES THAT THE INVESTMENT SHOULD HAVE BEEN MADE BEFORE THE DUE DATE OF FILING RETURN U/S. 139(1). 2.3 THE LD. CIT(A) FAILED TO APPRECIATE THAT AS PER PROVISIONS OF 54F(4) THE PORTION OF CAPITAL GAIN NOT UTILIZED FOR THE PURCHA SE OR CONSTRUCTION OF THE NEW ASSET SHALL BE DEPOSITED BY HIM IN CAPITAL GAIN ACCOUNT BEFORE FURNISHING THE RETURN OF INCOME U/S. 139(1). 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E HAS FILED RETURN OF INCOME FOR THE ASSESSMENT YEAR 2010-11 WITH TOTAL INCOME R S. NIL ON 17.06.2011 AND THE RETURN OF INCOME WAS PROCESSED U/S. 143(1) OF THE A CT. SUBSEQUENTLY, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE ENTERED I NTO AGREEMENT WITH M/S. COVAI PROPERTY CENTRE (INDIA) LTD., COIMBATORE AND THERE WAS A MISTAKE IN CALCULATION OF CAPITAL GAINS AND HAS REASON TO BELI EVE THE ESCAPEMENT OF INCOME AND ISSUED NOTICE U/S. 148 OF THE ACT. SUBSEQUENTLY , LD. AO HAS ISSUED NOTICE U/S. 143(2) OF THE ACT. THE LD. AR OF THE ASSESSEE APPEARED FROM TIME TO TIME AND PRODUCED THE FINANCIAL STATEMENTS, DETAILS OF L AND ADVANCE AMOUNT, AGREEMENT COPIES ENTERED BY THE ASSESSEE ON 21.10.2 009 AND SUBMITTED :-3-: I.T.A. NO. 801/MDS/2016 PURCHASE DOCUMENT OF THE PROPERTY AT 03.09.2010. F URTHER, THE ASSESSEE HAS CLAIMED EXEMPTION U/S. 54EC OF THE ACT ON INVESTMEN T OF LONG TERM CAPITAL GAINS IN RURAL ELECTRIFICATION BONDS ON 29.07.2010. THE ASSESSEE FURTHER PRODUCED BANK ACCOUNT FOR VERIFICATION AND THE LD. AO FOUND AS PER DEVELOPMENT AGREEMENT THE ASSESSEE HAS ENTERED INTO SALE OF 34 SITES/PLOTS ON THE LAND OF 2.60 ACRES AND AFTER MAKING NECESSARY PROVISIONS FO R PARK AND ROAD THE EFFECTIVE AREA WORKED OUT TO 152.56 CENTS, WHICH WERE SOLD IN THREE FINANCIAL YEARS 2009- 10, 2010-11 & 2011-12. THE AREA SOLD IN THE ASSESS MENT YEAR 2009-10 IS 107.42 CENTS FOR A CONSIDERATION OF RS. 140.81 LAKHS. THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE HAS WORKED OUT THE INDEXED COST O N LAND OF RS. 9,06,000/- AND CALCULATED LONG TERM CAPITAL GAINS OF RS, 1,31,75,0 00/- AND FURTHER INVESTED IN REC BONDS ON 29.07.2010 RS. 40,00,000/-. THE ASSES SEE EXPLAINED THE DETAILS OF PURCHASE OF PROPERTY ON 03.09.2010 AND CLAIMED EXEM PTION U/S. 54F OF THE ACT. THE ASSESSING OFFICER IS OF THE OPINION THAT THE AS SESSEE HAD NOT INVESTED THE NET CONSIDERATION IN PURCHASE OF THE RESIDENTIAL PROPER TY NOR INVESTED IN CAPITAL GAIN ACCOUNT SCHEME. WHEREAS, OUT OF PURCHASE VALUE OF PROPERTY RS. 1,05,00,000/-, THE ASSESSEE HAS PAID RS. 15,00,000/- ON 20.07.2010 AND RS. 15,00,000/- ON 28.09.2010 AND THE BALANCE CHEQUE PAYMENT OF RS. 75 ,00,000/- AT THE TIME OF REGISTRATION ON 03.09.2010. THE ASSESSING OFFICER ON PERUSAL OF THE PROVISIONS OF SEC. 54F OF THE ACT IS OF THE OPINION THAT THE ASSE SSEE SHOULD HAVE INVESTED IN CAPITAL GAIN ACCOUNT SCHEME BALANCE AMOUNT OF RS. 7 5,00,000/- BEFORE DUE DATE OF FILING OF RETURN OF INCOME ON 31.07.2010 U/S. 13 9(1) OF THE ACT. THE ASSESSEE FILED THE EXPLANATIONS ON SALE AS IT DOES NOT PERTA INS TO ONE SINGLE TRANSACTION :-4-: I.T.A. NO. 801/MDS/2016 AND THERE WAS SOME DELAY WHICH WAS BEYOND CONTROL O F THE ASSESSEE AND THE REGISTRATION OF SALE DEED WAS DELAYED BY 33 DAYS. WHEREAS, THE ASSESSING OFFICER RELIED ON THE PROVISIONS OF SECTION 54F AND U/S. 139(1) OF THE ACT AND WAS OF THE OPINION THAT THE MAIN OBJECT BEING INVESTMEN T OF BALANCE CONSIDERATION IN THE CAPITAL GAIN ACCOUNT SCHEME AND CONCLUDED THAT THE ASSESEE HAS NOT INVESTED THE SALE PROCEEDS IN THE CAPITAL GAIN ACCOUNT SCHEM E AND ALLOWED EXEMPTION U/S. 54 OF THE ACT TO THE EXTENT OF RS. 30 LAKHS ONLY AN D DEDUCTION U/S. 54EC OF THE ACT RS. 40 LAKHS AND WORKED OUT THE TAXABLE LONG TE RM CAPITAL GAINS OF RS. 61,75,000/- AND PASSED ORDER U/S. 143(3) AND 147 OF THE ACT DATED 07.11.2014. 4. AGGRIEVED BY THE ORDER, ASSESSEE FILED AN APPEAL WITH THE CIT(A). IN THE APPELLATE PROCEEDINGS, THE LD. AR REITERATED THE SU BMISSIONS OF ASSESSMENT PROCEEDINGS AND FILED THE WRITTEN SUBMISSIONS AND F URTHER EXPLAINED THAT THE ASSESSEE HAS COMPLIED THE BASIC CONDITION UNDER THE PROVISIONS OF SECTION 54F OF THE ACT BY INVESTING IN THE PROPERTY WITHIN 6 MONTH S AND SUPPORTED HIS SUBMISSIONS WITH JUDICIAL DECISION AND CO-ORDINATE BENCH DECISION OF R.K.P. ELAYARAJAN V. DCIT [2012] 23 TAXMANN.COM 206, WHERE IT WAS HELD THAT THE APPELLATE HAS SATISFIED THE CONDITION OF PURCHASE O F RESIDENTIAL PROPERTY WITHIN THE PERIOD ALLOWED U/S. 139(4) OF THE ACT AND WELL WITHIN 2 YEARS FROM THE DATE OF TRANSFER OF ORIGINAL ASSET AND IS ELIGIBLE FOR EXEM PTION U/S. 54F OF THE ACT. THE LD. CIT(A) CONSIDERED THE VARIOUS FACTS, PROVISIONS AND APPLICABILITY OF SECTION 54F OF THE ACT AND RELIED ON THE DECISIONS :-5-: I.T.A. NO. 801/MDS/2016 1. CIT V. RAJESH KUMAR JAIN [2006] 286 ITR 274/15 7 TAXMANN 398 (GAU.) 2. FATHIMA BAI V. ITO [IT APPEAL NO. 435 OF 2204, DATED 17.01.2008] (KAR.) 3. CIT V. SMT VRINDAA P. ISSAC [2012] 24 TAXMANN.C OM 131/[2013]2012 TAXMANN 101 (MAG.) 4. NAND LAL SHARMA V. ITO [2015] 61 TAXMANN.COM 271 (1)(C) (JAIPUR) 5. ACIT V. SMT. ASHA ASHOK BOOB [2015] 59 TAXMANN.C OM 173 (PUNE). AND IS OF THE OPINION THAT THE ASSESSEE IS ELIGIBL E FOR DEDUCTION U/S. 54F OF THE ACT IN RESPECT OF PAYMENT OF RS. 75,00,000/- MADE T OWARDS PURCHASE OF PROPERTY AND OBSERVED AT PAGE 5 PARA 4 : I HAVE CONSIDERED THE FACTS AND CIRCUMSTANCES OF T HE CASE, SUBMISSIONS AND ARGUMENTS OF THE AR AND RELEVANT CASE LAWS ON T HE ISSUE IN DISPUTE. IT IS TRUE THAT THE AO HAD ONLY DISPUTED WITH PART PAYMEN T OF RS. 75,00,000/- MADE AFTER 31.07.2010 TOWARDS PURCHASE OF NEW PROPERTY A ND HELD THAT THE SAME CANNOT BE CONSIDERED FOR ALLOWING THE DEDUCTION U/S . 54F. THE AO HELD THAT DEDUCTION U/S. 54F CAN BE ALLOWED ONLY IF THE ENTIR E SALE PROCEEDS COULD BE UTILIZED OR REINVESTED IN BUYING ANOTHER NEW PROPER TY WITHIN 6 MONTHS FROM THE DATE OF SALE OR BEFORE THE DUE DATE FOR FILING THE RETURN OF INCOME FOR THE SAID ASSESSMENT YEAR IN WHICH THE SALE TRANSACTION TOOK PLACE OR OTHERWISE THE AMOUNT SHOULD BE DEPOSITED IN A CAPITAL GAIN ACCOUN T IN A RECOGNIZED BANK. THE AO IS, HOWEVER, INCORRECT IN STATING THAT REINVESTM ENT IN NEW PROPERTY SHOULD BE MADE WITHIN SIX MONTHS FROM THE DATE OF SALE OF ORI GINAL ASSET AS NO SUCH CONDITION IS SPECIFIED IN SECTION 54F. THE CONDITIO N MENTIONED IN THE SECTION IS THAT THE AMOUNT UNUTILIZED BEFORE THE DATE OF FURNI SHING OF RETURN OF INCOME U/S. 139 SHALL BE DEPOSITED IN CAPITAL GAINS SCHEME. WIT H REGARD TO THE DATE OF FURNISHING OF RETURN U/S. 139, VARIOUS COURTS AND T RIBUNALS HAVE HELD THAT IT :-6-: I.T.A. NO. 801/MDS/2016 INCLUDES THE DATE SPECIFIED U/S. 139(4) AND THAT IF INVESTMENT IS MADE ON PURCHASE OF RESIDENTIAL PROPERTY WITHIN THE PERIOD ALLOWED U/S. 139(4), IT IS SUFFICIENT FOR ALLOWING THE DEDUCTION U/S. 54F. THI S IS WHAT HAS BEEN HELD BY THE HIGH COURT OF PUNJAB AND HARYANA IN THE JUDGEMENT C ITED BY THE AR. THE JURISDICTIONAL CHENNAI TRIBUNAL ALSO, IN THE CASE O F R.K.P. ELAYARAJAN, HELD THE ISSUE IN THE SAME MANNER AS BELOW. 'THE ISSUE BEFORE US IS WHETHER THE AMOUNT WHICH WA S UTILIZED BY THE ASSESSEE FOR MAKING INVESTMENT IN PURCHASE OF NEW R ESIDENTIAL HOUSE BEFORE THE DATE OF FILING OF RETURN U/S. 139(4) QUA LIFIES FOR DEDUCTION U/S. 54F (1) OR ONLY THE AMOUNT WHICH WAS UTILIZED FOR I NVESTMENT IN PURCHASE OF NEW RESIDENTIAL HOUSE BEFORE THE DUE DATE OF FIL ING OF RETURN U/S. 139(1) ALONE QUALITIES FOR DEDUCTION U/S. 54F(1) OF THE AC T. WE FIND THAT ON THE ABOVE ISSUE VIEW TAKEN BY US ABOVE IN THIS ORDER IS FULLY SUPPORTED BY THE DECISION OF THE HON'BLE P&H HIGH COURT IN THE CASE OF MS. JAGRITI AGGARWAL (SUPRA) WHEREIN IT WAS HELD THAT SECTION 139 INCLUD ES SECTION 139(4) ALSO. THEREFORE, THE APPEAL OF THE ASSESSEE IS ALLOWED IN THE MANNER INDICATED ABOVE.' CONSIDERING THE FACTUAL ASPECTS AND JUDICIAL DECISI ONS, THE LD. CIT(A) HAS DIRECTED THE ASSESSING OFFICER TO ALLOW DEDUCTION OF RS. 75, 00,000/- AND ALLOWED THE APPEAL. 5. AGGRIEVED BY THE CIT(A) ORDER, REVENUE HAS FILED AN APPEAL BEFORE THE TRIBUNAL. THE LD. DR SUBMITTED THAT THE LD. CIT(A) ERRED IN DIRECTING THE ASSESSING OFFICER FOR ALLOWING DEDUCTION U/S. 54F O F THE ACT IRRESPECTIVE OF THE FACT THAT THE ASSESSEE HAS NOT DEPOSITED THE SALE C ONSIDERATION BEFORE THE DUE :-7-: I.T.A. NO. 801/MDS/2016 DATE OF RETURN OF INCOME IN CAPITAL GAINS ACCOUNT S CHEME FOR CONSTRUCTION OF THE PROPERTY. FURTHER, LD. CIT(A) ERRED THAT THE INVES TMENT COMPLY THE CONDITION OF THE SECTION 54F OF THE ACT AND PRAYED FOR SETTING A SIDE THE ORDER OF CIT(A). CONTRA, THE LD. AR RELIED ON THE ORDER OF CIT(A) AN D PRAYED FOR THE DISMISSAL OF THE REVENUE APPEAL 6. WE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATE RIAL ON RECORD AND JUDICIAL DECISIONS. THE SOLE CRUX OF THE ISSUE PER TAINING TO THE PURCHASE OF RESIDENTIAL PROPERTY BY THE ASSESSEE AND THE ASSESS EE HAS NOT COMPLIED THE CONDITIONS ENVISAGED IN INVESTMENT OF NET CONSIDERA TION BEFORE THE DUE DATE U/S. 139(1) OF THE ACT. WE CONSIDERED THE FACTS AND DET AILS OF PURCHASE OF PROPERTY OF THE ASSESSEE 1. PURCHASE OF THE PROPERTY : 03.09.2010 2. PAYMENT MADE FOR PURCHASE BEFORE 31.03.2012 : 1,05,00,000/- 3. NET CONSIDERATION TO BE DEPOSITED IN THE CAPITAL GAIN ACCOUNT SCHEME WITH DUE DATE U/S. 139(1) OF THE ACT : 31.07.2010 4. DATE OF FILING BELATED RETURN OF INCOME U/S. 139(4) OF THE ACT : 31.03.2012 THE ASSESSEE HAS INVESTED ENTIRE CONSIDERATION IN R ESIDENTIAL PROPERTY BEFORE DUE DATE U/S. 139(4) OF THE ACT RS. 1,05,00,000/- AND C OMPLIED THE MAIN CONDITIONS OF SECTION 54F OF THE ACT. WE HAVE PERUSED THE PRO VISIONS OF SECTION 54F OF THE :-8-: I.T.A. NO. 801/MDS/2016 ACT AND FIND SIMILAR ISSUE WAS DEALT BY THE CO-ORDI NATE BENCH OF THE TRIBUNAL IN THE CASE OF A.C. SHYAM SUNDAR VS JCIT IN ITA NO. 22 79/MDS/2015, WHERE HELD AT PARA 7 WHICH READ AS UNDER: 7. WE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MAT ERIAL ON RECORD AND JUDICIAL DECISIONS CITED. THE LD. AUTHORISED REPRES ENTATIVE CONTENTION THAT THE ASSESSEE IS AN EMPLOYEE AND DUE DATE OF FILING OF R ETURN APPLICABLE FOR THE ASSESSMENT YEAR 2011-12 IS 31.07.2011. THE ASSESSEE HAS SOLD THE PROPERTY AND INVESTED IN PURCHASE OF RESIDENTIAL FLAT AS PER BUILDER AGREEMENT ENTERED ON 03.02.2011. THE ASSESSEE HAS PAID RS. 30,00,000/ - BEFORE 31.07.2011 AS PER THE EVIDENCE PRODUCED BY BUILDER IN LETTER DATE D 18.02.2014 AND REMAINING AMOUNT PAID IN THREE INSTALMENTS BEFORE 3 1.03.2012 WHICH IS NOT DISPUTED BY THE ASSESSING AUTHORITY. THE CRUX OF TH E DISPUTED ISSUE ARISE BEFORE ASSESSING OFFICER THAT THE ASSESSEE SHOULD H AVE DEPOSITED THE AMOUNT IN THE CAPITAL GAIN ACCOUNTS SCHEME BEFORE 139(1) O F THE ACT, THEREFORE THE LD. ASSESSING OFFICER HAS RESTRICTED EXEMPTION U/SEC. 5 4F AND DENIED THE BALANCE. ONPERUSAL OF THE SEC. 54F(1) OF THE ACT THE EXEMPTI ON IS ALLOWED TO THE ASSESSEE AS UNDER:- 54F. (1) [SUBJECT TO THE PROVISIONS OF SUB-SECTION (4), WHERE, IN THE CASE OF AN ASSESSEE BEING AN INDIVIDUAL OR A HINDU UNDIVIDED FAMILY], THE CAPITAL GAIN ARISES FROM THE TRANSFER OF ANY LONG-TERM CAPITAL ASSET, NOT BEING A RESIDENTIAL HOUSE (HEREA FTER IN THIS SECTION REFERRED TO AS THE ORIGINAL ASSET), AND THE ASSESSE E HAS, WITHIN A PERIOD OF ONE YEAR BEFORE OR [TWO YEARS] AFTER THE DATE ON WHICH THE TRANSFER TOOK PLACE PURCHASED, OR HAS WITHIN A PERIOD OF THREE YEARS AFTER THAT DATE [ CONSTRUCTED, A RESIDENTIAL HOUSE ] (HEREAFTER IN THIS SECTION REFERRED TO AS THE NEW A SSET), THE CAPITAL GAIN SHALL BE DEALT WITH IN ACCORDANCE WITH THE FOLLOWIN G PROVISIONS OF THIS SECTION, THAT IS TO SAY, (A) IF THE COST OF THE NEW ASSET IS NOT LESS THAN T HE NET CONSIDERATION IN RESPECT OF THE ORIGINAL ASSET, THE WHOLE OF SUCH CAPITAL GAIN SHALL NOT BE CHARGED UNDER SECTION 45 ; (B) IF THE COST OF THE NEW ASSET IS LESS THAN THE N ET CONSIDERATION IN RESPECT OF THE ORIGINAL ASSET, SO MUCH OF THE CA PITAL GAIN AS BEARS TO THE WHOLE OF THE CAPITAL GAIN THE SAME PRO PORTION AS THE COST OF THE NEW ASSET BEARS TO THE NET CONSIDER ATION, SHALL NOT BE CHARGED UNDER SECTION 45: [ PROVIDED THAT NOTHING CONTAINED IN THIS SUB-SECTION SHALL AP PLY WHERE (A) THE ASSESSEE, (I) OWNS MORE THAN ONE RESIDENTIAL HOUSE, OTHER THA N THE NEW ASSET, ON THE DATE OF TRANSFER OF THE ORIGINAL ASSE T; OR :-9-: I.T.A. NO. 801/MDS/2016 (II) PURCHASES ANY RESIDENTIAL HOUSE, OTHER THAN TH E NEW ASSET, WITHIN A PERIOD OF ONE YEAR AFTER THE DATE OF TRANS FER OF THE ORIGINAL ASSET; OR (III) CONSTRUCTS ANY RESIDENTIAL HOUSE, OTHER THAN THE NEW ASSET, WITHIN A PERIOD OF THREE YEARS AFTER THE DATE OF TR ANSFER OF THE ORIGINAL ASSET; AND (B) THE INCOME FROM SUCH RESIDENTIAL HOUSE, OTHER T HAN THE ONE RESIDENTIAL HOUSE OWNED ON THE DATE OF TRANSFER OF THE ORIGINAL ASSET, IS CHARGEABLE UNDER THE HEAD INCOME FROM HOUSE PROPER TY.] CONSIDERING THE DATE OF INVESTMENTS AND PROVISIONS OF LAWS AS UNDER:- (I) DATE OF TRANSFER OF VACANT LAND : 02.10.2010. (II) THE DATE OF FILING OF RETURN BY ASSESSEE : 03. 11.2011. (III) DUE DATE OF FILING RETURN FOR THE ASSESSMENT YEAR 2011-12 : 31.07.2011. (IV) DATE OF BUILDER AGREEMENT FOR CONSTRUCTION OF HOUSE PROPERTY : 03.02.2011. (V) DUE DATE OF FILING OF BELATED RETURN U/SEC. 139 (4) OF THE ACT : 31.03.2013. CONSIDERING THE ABOVE FACTS AND PROVISIONS OF LAW, THE ASSESSEE HAS INVESTED TOTAL CONSIDERATION OF <66,64,457/- BEFORE DUE DATE U/SEC. 139(4) OF THE ACT BEING 31.03.2013. THE INVESTMENT IN RESIDENTIAL PRO PERTY HAS TO BE WITHIN THREE YEARS FROM THE DATE OF TRANSFER OF VACANT LAN D ON 02.10.2010. THE ASSESSEE HAS NOT DEPOSITED IN CAPITAL GAIN ACCOUNTS SCHEME <36,00,000/- BEFORE 139(1) OF THE ACT BUT COMPLIED WITH THE COND ITIONS U/S.54F(1) OF THE ACT ON PURCHASING AND CONSTRUCTION OF RESIDENTIAL F LAT WITHIN THREE YEARS FROM THE TRANSFER OF ORIGINAL ASSET WHICH IS NOT DISPUTE D BY THE REVENUE. THE PROVISIONS OF SEC. 54F OF THE ACT ARE BENEFICIAL AN D ARE TO BE CONSIDERED LIBERALLY FOR REASONABLE BONAFIDE CAUSE BUT INVESTM ENT IN RESIDENTIAL PROPERTY IS MANDATORY WHICH THE ASSESSEE HAS PROVED WITH SUB STANTIAL EVIDENCE BEFORE THE LOWER AUTHORITIES. PRIME FACIE THE CONSTRUCTION OF THE PROPERTY HAS BEEN COMPLIED THOUGH INVESTMENT WAS MADE SUBSEQUENTLY BU T BEFORE EXTENDED DUE DATE U/S.139(4) OF THE ACT. THE ASSESSEE HAS DI RECT INVESTMENT IN HOUSE PROPERTY AND THEREFORE NOT OPTED CAPITAL GAIN ACCOU NT SCHEME. THE LD. AUTHORISED REPRESENTATIVE FURTHER SUBSTANTIATED ARG UMENTS 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 CIRCUMST ANCES, THE ASSESSEE ENTERED INTO AGREEMENT WITH BUILDER FOR UNDIVIDED S HARE OF LAND AND CONSTRUCTION AGREEMENT ON 03.02.2011 WHICH IS VERY MUCH BEFORE PROVISIONS OF SEC. 139(4) OF THE ACT. IN THE CASE OF JAGTAR SI NGH CHAWLA OF PUNJAB AND HARYANA HIGH COURT IN ITA NO.71 OF 2012, DATED 20.0 3.2013 THE ASSESSEE HAS PAID SUBSTANTIAL AMOUNT FOR PURCHASE OF RESIDENTIAL PROPERTY BEFORE THE EXTENDED DUE DATE OF FILING OF RETURN AND THE ASSES SEE WAS ELIGIBLE FOR EXEMPTION AND NOT LIABLE TO PAY ANY CAPITAL GAIN TA X. CONSIDERING THE FACTUAL ASPECTS, GENUINESS OF TRANSACTIONS AND BENEFICIAL A ND LIBERAL ASPECTS OF THE PROVISIONS AND THE JUDICIAL DECISIONS RELIED BY THE ASSESSEE. WE ARE OF THE OPINION THAT ASSESSEE COMPLIED THE CONDITIONS AND I S ELIGIBLE FOR EXEMPTION :-10-: I.T.A. NO. 801/MDS/2016 U/S.54F OF THE ACT. WE SET ASIDE THE ORDER OF COMMI SSIONER OF INCOME TAX (APPEALS) AND DIRECT THE ASSESSING OFFICER TO GRANT EXEMPTION U/S.54F OF THE ACT ON THE REMAINING CONSTRUCTION COST WHICH WAS IN VESTED IN THE RESIDENTIAL PROPERTY BEFORE DUE DATE U/S.139(4) OF THE ACT AND ALLOW THE GROUNDS OF THE ASSESSEE.' ON APPLYING THE PROVISIONS AND RATIO TO THE PRESENT CASE, THE ASSESSEE HAS INVESTED NET CONSIDERATION IN PURCHASE OF THE RESID ENTIAL PROPERTY AND COMPLIED THE CONDITION U/S. 54F OF THE ACT. THEREFORE, CONSI DERING THE APPARENT FACTS MATERIAL ON RECORD AND JUDICIAL DECISIONS AND CO-OR DINATE BENCH DECISION, WE ARE OF THE OPINION THAT THE ASSESSEE IS ELIGIBLE FOR DE DUCTION U/S. 54F OF THE ACT IN RESPECT OF PAYMENTS MADE BEFORE DUE OF FILING THE B ELATED RETURN OF INCOME ON 31.03.2012. ACCORDINGLY, WE ARE NOT INCLINED TO IN TERFERE WITH THE ORDER OF THE CIT(A) WHO HAS DEALT EXHAUSTIVELY ON PROVISIONS AND JUDICIAL DECISIONS AND ALLOWED THE APPEAL AND WE UPHOLD THE SAME AND DISMI SS THE REVENUE APPEAL. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED ON TUESDAY, THE 4TH DAY OF APRIL, 2017 AT CHENNAI. SD/- ( . ) ( ABRAHAM P. GEORGE ) / ACCOUNTANT MEMBER SD/ - ( . ) (G. PAVAN KUMAR) & /JUDICIAL MEMBER /CHENNAI, 5 /DATED: 04TH APRIL, 2017. JPV * -&78 98 /COPY TO: 1. )/ APPELLANT 2. -.) /RESPONDENT 3. : ( )/CIT(A) 4. : /CIT 5. 8 -&& /DR 6. /GF